Affordable Legal Services for Christmas

Gift Certificates for Legal Services?

This may sound like a crazy idea at Christmas but we all know people (all year long) that could use a half hour with an attorney to gain peace of mind and a path forward in their lives. This may be a compassionate gift for someone in need and could at least start the process without a heavy handed “intervention.”

It has been documented, and we see this in practice, that people wait until after the holidays to make big personal decisions like bankruptcy, separation and divorce as well as whether or not to sue over a business deal.  It is also true that when the Christmas bills come in January, the financial situation of a family becomes apparent.

Legal Services as a Christmas Gift

Legal Services in an Hour or Less Can Provide a Lot of Information

Typical uses for such pre-paid services are bankruptcy, collection defense, foreclosure defense, garnishments, family law matters including anti-harassment orders and changes in child custody and support and even small business matters like lease defaults, creditor liens and contract disputes. A short visit with an experienced attorney on any of these issues will cost between $125.00 and $250.00 and provide a lot of information that will help the client understand their current problem and make a plan to resolve matters.

Prepaid Legal Services for Christmas, What You Need to Know

There are some issues for attorneys in providing such “prepaid legal services” but these are not unusual.  Whenever someone other than the client  pays for legal services the confidential attorney-client relationship is created with the client, not the person who pays.  This means that the person who pays for the services may not be able to monitor how the services are used directly. A person receiving such a gift however, may be more likely to use it if it is confidential.

While prepaid legal services may not be a suitable gift to find under the tree, it may be a welcome and compassionate alternative.

Contact Steven Schneider at: (509) 838-4458 to discuss the particular legal situation of the person you have in mind to receive such a gift.  He can give you an overview of solutions and costs that can help with your loved one’s legal problem.

 

Bankruptcy – Can I keep My Personal Property?

can I keep my personal property during bankruptcy

Keeping Personal Property When Filing Bankruptcy

You might have seen the classic Steve Martin movie The Jerk. Martin’s  character and his girlfriend have become incredibly rich but are about to lose everything. Martin says “We might lose all our stuff but we’ll still have each other. “  She says “But I want the stuff!”

Fortunately, state and federal law allow debtors to keep significant personal property (a lot of stuff) when a Chapter 7 bankruptcy is filed. After a home, the biggest purchases for most people are their motor vehicles.  Most people buy vehicles with loans and vehicles depreciate significantly as soon as they are driven off the lot. This means there is usually very little equity in a vehicle because the bank has a lien for the money owed.  Federal exemptions currently allow a debtor to keep up to $3,670.00 in equity in one vehicle.

Personal Property You Can Keep

Similarly, Federal exemptions allow debtors to keep the following:

  • $12,250.00 in household furnishings, household goods, wearing apparel, appliances, books, animals, crops, or musical instruments
  • $1,550.00 in jewelry, any other property valued up to $1,225.00
  • $11,500.00 of any unused homestead exemptions
  • $2,300.00 in value in any implements, professional books, or tools, of the trade.

Note that the value of all such items is liquidation, depreciated, yard sale value.  In other words, no matter how much you value that classic Chevy you always wanted to restore but never did, it’s just junk to the Trustee.  That’s good for you in bankruptcy.

The same is true with your priceless Hot Wheels, Star Wars, and Cabbage Patch Kids collections.  The value is only what you can dump it for today, not what you paid for it or would like to sell it for.  Your granddad’s civil war rifle however, may be worth much more than you realize.

Social security benefits, IRA’s, 401k’s and pension benefits are also exempt. 

Dogs are considered property in the State of Washington, while cats are not.  Cats must have lobbied for that rule.  In any case, your highly trained hunting dog, or your prize winning show cat or stud horse may very well be valuable non-exempt property

Household goods are specifically itemized in the Bankruptcy Code to include:

“clothing, furniture, appliances, 1 radio, 1 television, 1 VCR, linens, china, crockery, kitchenware, educational materials and educational equipment primarily for the use of minor dependent children of the debtor, medical equipment and supplies, furniture exclusively for the use of minor children, or elderly or disabled dependents of the debtor,  personal effects (including the toys and hobby equipment of minor dependent children and wedding rings) of the debtor and the dependents of the debtor and 1 personal computer and related equipment. “

Some of the terms are outdated, such as the VCR, but you get the idea.  Congress decided that these items were part of the minimal American Dream; wedding rings, toys and furniture for children and television.  Anything beyond these items would have to fall under another exemption.

Household Goods You Can’t Keep During Bankruptcy

Back to Congress.  The Bankruptcy Code does not consider the following as Household Goods:

“works of art (unless by or of the debtor, or any relative of the debtor), electronic entertainment equipment with a fair market value of more than $650 in the aggregate (except 1 television, 1 radio, and 1 VCR),  items acquired as antiques with a fair market value of more than $650 in the aggregate,  jewelry with a fair market value of more than $650 in the aggregate (except wedding rings); and a computer (except as otherwise provided for in this section), motor vehicle (including a tractor or lawn tractor), boat, or a motorized recreational device, conveyance, vehicle, watercraft, or aircraft.”

In some situations, a debtor can convert non-exempt property to exempt property before filing bankruptcy.  For example, non-exempt cash can be used to purchase exempt household goods.  There are many more specific exemptions and the debtor may also be required to use state exemptions instead of federal or choose between state and federal. Some of the exemptions are doubled for a married couple, others are not.

Don’t Try To Answer These Bankruptcy Questions Alone

A debtor needs an experienced bankruptcy attorney to help sort through these rules and preserve as much property as possible under the circumstances.

A half an hour free consultation with an attorney who specializes in bankruptcy will give you a much better idea of how much stuff you can keep and how to move forward with your life after bankruptcy relief.

 

 

Can I Keep My House in Bankruptcy?

If I File For Bankruptcy, Can I Keep My House

Many people have one major asset and concern on their mind if they are considering filing a bankruptcy case” Will I be able to keep my house?  While there are a lot of variables in how this question is answered, generally, if you are not behind on your house payments and can keep making the payments during and after bankruptcy you can keep your house in a Chapter 7 or Chapter 13 bankruptcy case. Chapter 7 is commonly called a liquidation case and Chapter 13 involves a payment plan.

Washington State Homestead Exemption

In either type of case, you are entitled to certain exemptions, meaning property that cannot be taken from you.  In Washington you can exempt up to $125,000 worth of equity in your home.  This is your Homestead Exemption.  Equity is the difference between what you owe on your home and what it is worth. Many homeowners have very little equity because of financing 100% of the purchase price or having taken out a home equity line of credit.  Before the recession that occurred in 2008 it was possible to borrow up to the full value of a home.  Since 2008, property values dropped and have now started to rise.  For many however, their home loan leaves no room for non-exempt equity.

You Can Still Keep Your Home In A Chapter 13

If you are behind in your payments, you can still keep your home in a Chapter 13 if you can make the monthly payment and pay off the past due payments over 36 to 60 months.  Both the current and past due payments are paid to the Chapter 13 Trustee monthly along with any additional amounts dedicated to the Plan. For example, if your monthly payment is $1,000.00 and you missed six payments (total $6,000.00) then you would have to be able to pay $1,000.00 plus $166.67 ($6,000.00 divided by 36) per month.

What You Should Think About When It Comes To Filing Bankruptcy

Also because of the recession, many homeowners have fallen so far behind that they cannot handle these payments.  If that is the case, they will need to consider giving up their house.  If there is no equity in the house this decision may make practical sense because the payments are not building value in the house.  There are of course, also many practical and emotional reasons that make can make this decision difficult. Life plans, the well-being of children, disruption in quality of life are all affected when a family faces the loss of their home. The situation can however, be made more predictable if all possibilities are considered.  Instead of making a heroic effort to save a house that the family can no longer afford, it may be less disruptive to plan a move in a less hurried manner as part of a bankruptcy.

Protect Yourself & Your Home When Filing For Bankruptcy

An experienced bankruptcy attorney can evaluate your financial situation and all the factors that affect this decision. Protect Your property, paycheck & peace of mind. Call us today so you can sleep easy tonight. 509-822-5898.

can i keep my house if i file for bankruptcy

File For Bankruptcy In Spokane

Filing For Bankruptcy In Spokane

Filing for Bankruptcy in Spokane, Riverfront Park Spokane

When the Bankruptcy Code was changed in 2006 many people believed it became more difficult to file for bankruptcy or that they would have to pay all their debts in full.  I still hear these reasons when people tell me how long they have suffered with crushing debt. The 2006 amendments did not make it more difficult to file for bankruptcy in Spokane or anywhere in Washington state for that matter.

Post 2006 Bankruptcy

After the changes in 2006, your income is compared to a state wide average, a process known as Means Testing.  If your income is below the state wide average you are generally still eligible to file for Chapter 7 which cancels most unsecured debts. 

State wide averaging includes the Seattle side of the state where incomes are higher. Most families in Spokane fall well below that state wide average. Today, the state wide average for a family of four in Washington is $84,786.00 per year.  If you make less than that amount, and your legitimate expenses exceed your income every month, you can still file for Chapter 7 bankruptcy and have most of your debts canceled.

What To Do

Protect yourself, your property and your paycheck and have some peace of mind. If you are in Spokane or close to Spokane, contact our office at 509.838.4458 or fill out our bankruptcy intake form on our website for a quick evaluation of your situation and let’s see if filing for bankruptcy is right for you or if there are other alternatives.

Don’t Get Bit By Flipper Flipping Houses

Flipping Houses

Picture of a dolphin for a blog on flipping houses

It seems like every bad idea gets discovered by a new generation of hucksters and marks. Wherever there is a buyer’s market in real estate flipping houses becomes popular and very well may work for the flipper in some cases. 

There is usually a distressed property that is on the verge of foreclosure or has some defects that prevent sale at full market price.  The flipper buys the house for a discount and then puts the minimum of superficial work into it required to sell at a profit. If the market is hit just right the profit may be substantial.

Flipping the Property Condition Disclosure Checklist

This may however, turn into a nightmare for the buyer as well as the flipper. The State of Washington requires a seller to complete a Property Condition Disclosure checklist and provide it to the buyer before the sale is completed. Any defects or hazardous conditions known to the seller must be disclosed.

Further, even knowledge of a small defect, such as a spongy floor, will make that seller liable for anything investigation of that defect would reveal, such as extensive dry rot or mold.  The flipper may become liable for any undisclosed defects at the cost required to return the property to the value at which it was purchased.

How Do You Know If You’re Dealing With a Flipper?

An obvious tip off is length of ownership. This information can be obtained from the county assessor’s or auditor’s office.  If the house has only been owned for a short time, pay extra attention to its condition.

A buyer should also have a house inspected by a professional home inspector before buying.  Any extensive new sufaces such as paint, wall paper, drywall or flooring, may be hiding a deeper defect.  Be sure to test all fixtures, appliances, plumbing, heating and electricity before buying.  In older  homes it is especially important to know whether knob and tube elecrical wiring, lead pipe or asbestos will make it difficult to insure or require additional work to sell with FHA or VA financing.

The lack of a real estate agent and a closing agent and seller financing on a real estate contract may also be worrisome, especially if a large down payment is required.  Lack of a title insurance policy is a red flag that should never be acceptable in a legitimate transaction.

Even work done without a permit may be a clue.  You can check the permit file at the City or County office of building and planning. Unpermitted work may also result in an inability to qualify for FHA or VA financing.

If The Deal Is Too Good, It’s Too Good

Remember that a too good to be true deal probably is, especially in a changing market.  Take your time and do your homework, including hiring a professional inspector.  Don’t get in a hurry or you might get bit by that smiling flipper.  An attorney can help you sort through these issues including research into title records, assessor’s and building permit records, as well as monitoring the sale to be sure the proper documentation is used and all transaction taxes and real property taxes are paid paid in closing.

Adverse Possession – Get Off My Lawn Part 2

In Where Get Off My Lawn Becomes Get Off My Dock – More On Adverse Possession

Adverse possession know your rights

Image courtesy of Photokanok / FreeDigitalPhotos.net

When your neighbor at the lake puts his dock in your square foot of second class shore land the gauntlet is seriously thrown down. Then he’ll build an addition to block your view, shine his porch light in your bedroom window, and fill your locks with glue.  This was the case with Green v. Hooper, where the case was further complicated by conflicting surveys.  There are two accepted methods of extending boundary lines into shore land.  One simply extends the line on the same bearing over the shoreline.  Another method is however, used to account for curving shorelines.  In that method, the lines are drawn to the center of an arc created by the natural curve.  When and how these methods are used may represent a difference of opinion between surveyors and experts at trial.  In the case of Green v. Hooper, the alleged encroachment was minimal, but the case cost hundreds of thousands of dollars to resolve.

The appeal court decided that the trial judge did not have sufficient evidence that a border made of railroad ties was intended to mark the true boundary.

 Take A Survey To Find Out Where Your Lawn Really Ends

In any case, however the first step is to order a survey.  Preferably, the survey will show the disputed line(s) and the location of structures, fences, docks, relative to the line(s). This costs money and might actually prove you wrong.  However, a Seller is required to disclose a dispute or discrepancy in the Seller’s Real Property Disclosures, Chapter 64.06 RCW, now applicable to commercial property and unimproved property as well as residential property.  And your title policy won’t cover a boundary discrepancy without a survey and will not cover something not in the record.

But the Seller must resolve the matter in order to sell the property, or even pass it down to the kids, without the dispute.  If the neighbors are reasonable, you may not need an attorney.  A survey is however, always advised even if to describe an agreed boundary line and record.

Bringing Out The Worst In People

But the situation brings out the worst in people because a man’s home is his castle from the depths to the heavens. When you order the survey, your neighbor might pull up stakes and scare the surveyor off.  You are getting ready to pour concrete on a 100 foot retaining wall and he gets a TRO as the cement trucks pull up.  He finds an old survey or gets a new one that contradicts yours, claims he’s been mowing that spot and planting posies for years, his grandpa had a pig sty right there and all the old timers remember that hog that won the blue ribbon.  And by the way, the original patent described one corner as at the big tree or on a rock with a chiseled cross.

One of the best stories in Washington comes out of the Entiat River, Thomas v. Bremer, Cascade v. Bremer, United States v, Bremer where federal judge Alan McDonald explains in an unpublished opinion the “whiskey survey.” In the 1880’s certain government surveyors, not so brave as our modern types, were afraid to get out the boat because of wild animals and native Americans, so they marked only the corners at the river, filling in the rest at the bar in the evening.  This meant that original patents described parcels that varied widely from proper surveys.  Settlers came in and staked out their land which differed from that actually described.  The gov’t conducted a resurvey of the land as it was staked by the settlers.  This survey was not however recorded.  Subsequent owners then could rely on the original survey to claim property outside of the boundaries of the resurvey.  In the case with Thomas, which we handled, the theory of adverse possession was dismissed because Bremer had actively disputed Thomas’s claim with lawsuits and tearing down fences from the beginning.  The claim was therefore, not “continuous.”

 Because the Thomases’ property tax receipts cover property in sections 15 and 23, whereas the Bremers’ receipts cover the SW ¼ of the SW ¼ of section 14, the Thomases cannot establish an adverse possession claim under the seven-year rule of RCW 7.28.070. They also cannot establish exclusive and uninterrupted possession of the nine acres given the multiple criminal and civil trespass complaints brought by the Bremers against them, the destruction of every fence they put up and the Bremers’ assertion of their ownership rights in the property for more than 20 years. Thomas v. Bremer, 88 Wn. App. 728 (1997)

 

Adverse Possession: Open and Notorious

This brings us to the factual elements that a claim of adverse possession must satisfy. The claim and use must be open, notorious, hostile, and continuous, under a claim of right, for the statutory period.  In other words, continuous until the statute of limitations of ejectment/quiet title has expired, 10 years in Washington, 20 in Idaho.  The use must be such as an owner would make of it for the whole time.  Leaving a field fallow, or unused under an open space or timber designation would still be continuous if that’s how an owner would use it.  Periods of unbroken adverse use by subsequent owners can be tacked together to equal the statutory period.

The factors of open and notorious use simply mean that the use is such that the possessor is not trying to hide it and that the use is known in the community.  An owner is assumed to have actual or constructive knowledge of such use.  Hostile does not mean animosity, but such use that would not be allowed by an owner without permission.

A permissive use cannot ripen into adverse possession unless the permission is expressly withdrawn and the use continues for the statutory period.  Likewise, an adverse use that is abandoned for the statutory period may be extinguished.

As this court stated in Miller, the adverse possession doctrine arose in order to assure the maximum utilization of the land, encourage the rejection of stale claims, and quiet titles.[11] But courts will not permit the ” theft” of property by adverse possession unless the owner had notice and an opportunity to assert his or her right. Therefore, there is no presumption in favor of the adverse holder because possession is presumed to be subordinate to the true owner’s title.[13]

Adverse possession requires 10 years of possession that is (1) exclusive, (2) actual and uninterrupted, (3) open and notorious, and (4) hostile. ” The ‘ hostility/claimofright’ element of adverse possession requires only that the claimant treat the land as his own as against the world throughout the statutory period.”Hostility is not personal animosity or adversarial intent, but instead connotes that the claimant’s use has been hostile to the title owner’s, in that the claimant’s use has been akin to that of an owner.

Permission to occupy the land, as given by the true title owner to the claimant, will negate the hostility element. This means that use of the land with the true title owner’s permission cannot be hostile. Therefore, ” ‘ a different set of rules applies when the initial use is permissive.’ ” The party claiming adverse possession bears the burden of proving that permission terminated. ” Because permission is personal to the grantor and cannot extend beyond that person’s ownership, the relevant viewpoint for determining when permissive use terminates is that of the party granting the permission.” (internal citations omitted) Herrin v. O’Hern, 168 Wn.App. 305 (Wash.App. Div. 1 2012)

Adverse Possession – Get Off My Lawn!

What is Adverse Possession?

Disputes over boundary lines that are longstanding may result in a change in ownership, therefore, a change in the boundary line, regardless of the results of a survey.  The common offensive or defensive theory to get around the legal description and survey is adverse possession. Adverse possession is legal conclusion based on facts. Specifically, facts that show the adverse possessor has been treating the property as an owner would for the period of the statute of limitations for a quiet title or ejectment action.

So the court is asked to quiet title to the property in the name of the adverse possessor or the record title holder depending upon the facts proven. The legal conclusion confirms the ownership of real property arising from certain facts which are not of record. It is not the result of a judicial decision. Rather, the court confirms that sufficient facts have already created a superior interest in real property.

Technically then, the action is one for quiet title or ejectment under Chapter 7.28 RCW.  The record owner may attempt to eject the adverse possessor using the statutory cause of action, the response to which would be a counterclaim for quiet title based on adverse possession. Or, the adverse possessor may file an action to quiet title as against the record owner and the record owner defends by disputing the facts establishing possession, and counters with ejectment.

7.28.010. Who may maintain actions – Service on nonresident defendant

Any person having a valid subsisting interest in real property, and a right to the possession thereof, may recover the same by action in the superior court of the proper county, to be brought against the tenant in possession; if there is no such tenant, then against the person claiming the title or some interest therein, and may have judgment in such action quieting or removing a cloud from plaintiff’s title; . . .

The ten-year rule is the general statute of limitations for recovery of real property.  Facts amounting to adverse possession, with nothing more, must exist for ten years for superior title to arise in the claimant.

§ 4.16.020. Actions to be commenced within ten years – Exception

The period prescribed for the commencement of actions shall be as follows:

Within ten years:

(1) For actions for the recovery of real property, or for the recovery of the possession thereof; and no action shall be maintained for such recovery unless it appears that the plaintiff, his or her ancestor, predecessor or grantor was seized or possessed of the premises in question within ten years before the commencement of the action.

Adverse possession plus color of title or payment of taxes shortens the limitations period to seven years:

7.28.050. Limitation of actions for recovery of real property – Adverse possession under title deducible of record

That all actions brought for the recovery of any lands, tenements or hereditaments of which any person may be possessed by actual, open and notorious possession for seven successive years, having a connected title in law or equity deducible of record from this state or the United States, or from any public officer, or other person authorized by the laws of this state to sell such land for the nonpayment of taxes, or from any sheriff, marshal or other person authorized to sell such land on execution or under any order, judgment or decree of any court of record, shall be brought within seven years next after possession being taken as aforesaid, but when the possessor shall acquire title after taking such possession, the limitation shall begin to run from the time of acquiring title.

The record owner who does not actively seek

§ 7.28.070. Adverse possession under claim and color of title – Payment of taxes

Every person in actual, open and notorious possession of lands or tenements under claim and color of title, made in good faith, and who shall for seven successive years continue in possession, and shall also during said time pay all taxes legally assessed on such lands or tenements, shall be held and adjudged to be the legal owner of said lands or tenements, to the extent and according to the purport of his or her paper title.

The attorney will see these facts come up in the context of a boundary dispute involving anywhere from a few square feet to tracts of acreage.  One party may have been using the property of another  for many years without knowledge and then a new owner comes in that asserts ownership.  A surveying mistake or a difference of opinion or method in resolving surveying issues may result in conflicting surveys.

In any case, traditional attitudes toward private ownership of real property, from the depths to the heavens, as a sovereign, in effect create the “Get off my lawn.” Mentality and confrontation.

Part Two Coming Up Next Week

Get of my lawn about adverse possession

Image courtesy of Sattva / FreeDigitalPhotos.net

Beware Of Equity Skimming

Equity Skimming is Creative Financing

Property owners, whether they are landlords or occupy their own home, need to be aware of “creative financing” that may be against the law and also financially risky.  In the current recession, some may not be aware of the dangers in seller financing of sales of distressed properties in a falling or recovering market.

A common illegal practice called “equity skimming” works generally like this:

A purchaser asks a seller to take a second mortgage for most of the purchase price and places a senior lien on the property in order to borrow the equity in cash.  Usually there is a promise to use the cash to take care of deferred maintenance and add value to the property.  Instead, the skimmer pockets the cash and lets the senior lienholder foreclose.  The seller’s junior lien is foreclosed and the senior lender takes the property, while the skimmer gets away with the cash. Sellers and lenders may be victims in this scam but the lender may also be accused of the crime.

What You Need To Know

A law was passed that makes this practice a felony and a violation of the Consumer Protection Act.  Courts have also held that a pattern of such practices violates laws against Racketeering, i.e. such practices are held to be organized crime.

The specific prohibitions in Chapter 61.34 RCW are  as follows:

The person purchases a dwelling in a transaction in which all or part of the purchase price is financed by the seller and is

(A) secured by a lien which is inferior in priority or subordinated to a lien placed on the dwelling by the purchaser, or

(B) secured by a lien on other real or personal property, or

(C) without any security; and

(ii)   The person obtains a superior priority loan which either

(A) is secured by a lien on the dwelling which is superior in priority to the lien of the seller, but not including a bona fide assumption by the purchaser of a loan existing prior to the time of purchase, or

(B) creating any lien or encumbrance on the dwelling when the seller does not hold a lien on the dwelling; and

(iii)   The person fails to make payments or defaults on the superior priority loan within two years subsequent to the purchase; and

(iv)   The person diverts value from the dwelling by applying or authorizing any part of the proceeds from such superior priority loan for the person’s own benefit or use.

Criminal Penalties From Equity Skimming

image of a law book and gavel

Courtesy of nirots at Free Digital Photos.net

Any person who willfully engages in a pattern of equity skimming is guilty of a class B felony under RCW 9A.20.021 . Equity skimming shall be classified as a level II offense under chapter 9.94A RCW.

 Civil Actions From Equity Skimming

There are also actions brought by the Attorney General’s office and individual civil actions and penalties under the Consumer Protection Act including damages, increased damages, attorney fees and costs. This is a fraud that is not cured by “as is” or “buyer beware” language or any consent or waiver by the seller. Any kind of creative financing that puts the seller in a junior position also requires transparent disclosures by closing agents and sellers are advised to consult their independent attorney for legal advice.

 

Spokane Junk Debt Collectors

Spokane Debtors and Cach, LLC

(Cach, LLC and other Spokane Junk Debt Collectors are serving Spokane debtors with unfiled lawsuits, many of which cannot be collected in court unless you ignore the lawsuit.)

In the past two months Cach, LLC has filed a total of 22 collection lawsuits in Spokane County Superior Court. That is just the tip of the iceberg. As you will learn below, Junk Debt Collectors make their money on unfiled lawsuits.

Spokane Junk Debt Collectors

Cach, LLC is one of many Junk Debt Collectors that take assignments of debt in bulk paying pennies on the dollar for the chance of collecting less than the full amount of the debt.  There are hundreds of lawsuits filed in Spokane County alone that are the work of Junk Debt Collectors.

How Junk Debt Collectors Work

Typically, Junk Debt Collectors will serve the Summons and Complaint but not file the paperwork in court. This saves them the $240.00 filing fee and attorney time, so you can see that their profit margin is low to begin with.  Junk debts are likely to be handled by law firms outside of Spokane County, and often in other states.  Again, you can see that this factor means they are highly motivated to settle without actually going to court. Many junk debts also lack sufficient documentation or are beyond the statute of limitations.  This  means that although the debts could not be collected in court, the collectors are counting on you voluntarily paying to get them off your back.  If you make even one payment on an uncollectible debt, the statute of limitations starts running all over again from the date of that payment.

Ignoring The Summons and Complaint

If you ignore the Summons and Complaint, then the collector will obtain a judgment against you by default.  That judgment will be in the full amount of the original debt; jackpot for the collector! All of a sudden you have an enforceable judgment against you that is good for at least 10 years of garnishments and property seizures. Your negotiating leverage has disappeared.

 Help for those in Spokane Junk Debt CollectorsWhat You Should Do You Are Served

If you are served with a collection Summons and Complaint, filed or unfiled, call an attorney who can efficiently deal with the problem. Don’t wait, in as little as twenty days you could be a judgment debtor.  Steven Schneider, Attorney at Law, P.S.

Junk Debt Collectors

A couple of years ago in the midst of the “Great Recession” we started to hear complaints about “Junk Debt Collectors.” Because of the failure of financial institutions such as Countrywide and others, many past due debts, even home loans, were not the subject of collection efforts for years.

The collection value of such old debt is minimal and some has even gone past the statute of limitations, 6 years on a written account contract in Washington.

final notice for debt collection or unpaid bill

A number of things will tip you off that the contacts you are receiving are from Junk Debt Collector:

  1. The debt is more than 5 years old.
  2. The attorney is not located in Spokane, but Portland, Seattle, Denver or elsewhere.
  3. Midland Funding, Portfolio Recovery Associates and LVNV are very active junk debt collectors in this area and nationally.
  4. Early efforts are made to compromise the claim for a smaller amount.

Volume Discount Collectors

Keep in mind these are volume discount collectors. They did not pay face value for the assigned debts, bought in bulk for cents on the dollar, and any recovery is a win for them. They may not be able to prove the original debt because of lack of documentation and may be unable to collect in court because of the statute of limitations.  It is also a violation of the Fair Debt Collection Practices Act to try to collect such an unenforceable debt. Collectors risk punitive fines and attorney fee awards for such violations.

 Forcing the Cessation of Junk Debt Collection

We examine each case for these legal issues before approaching with settlement offers. We have successfully forced cessation of collection efforts in some cases, and deep discounts in others.  An attorney can evaluate your individual case efficiently if you are the target of a Junk Debt Collector and determine the best way to protect your rights and assets.