Bankruptcy attorneys have long known of the disgraceful collection tactics of debt collectors and subprime lenders. Fortunately, federal and state laws protect consumers from many nasty collection practices, such as telephone harassment in the middle of the night.
Recently, the Los Angeles Times reviewed Capital One’s new credit card contract. You know, that document that comes with your credit card printed in 8 point type that no one reads? The Times discovered that Capital One is claiming to have many collection rights under this contract with the card holder, such as the right to contact customers “in any manner we choose.” That includes calls, emails, texts, faxes or a “personal visit,” reports the Los Angeles Times. Capital One also claims the right to suppress its caller ID and identify itself however it wants, a tactic known as spoof calling.
Representative from Capital One attempted some damage control and told the Times that, despite the legal language, it doesn’t typically pay home visits to its customers. “Capital One does not visit our cardholders, nor do we send debt collectors to their homes or work,” the company spokeswoman said. However, in the next breath Capital One stated that it may visit a customer’s home to repossess costly goods purchased on credit – but only as a “last resort.”
Is a creditor entitled to come to your home to collect on a debt? Yes, at least until you have some legal protection. Once you retain an attorney to represent you on the debt, a third party debt collector cannot contact you directly in any way, including mail, phone, or in person. Once you file for bankruptcy relief, creditors cannot directly contact you or take legal action without permission from the bankruptcy court.
Many creditors and third party collectors engage in harassment and other collection practices to squeeze out more money from consumers. In 2012, Capital One was fined $210 million for deceptive practices including fudging details or outright lying to customers to get them to sign up for expensive, low-value products like payment protection insurance and credit monitoring.
If you are being hounded by creditors or collection agencies, speak with an experienced bankruptcy attorney to discuss your options. In many cases, bankruptcy can discharge your debts and end collection harassment for good.