Debt Collection and Settlement

In recent years, the debt collection industry has exploded, mainly targeting low-income people, elderly individuals and persons with disabilities who do not have the resources to effectively defend themselves. Debt buyers purchase defaulted debt, including credit card debt and loans, for a tiny fraction of the amount of debt owed but do not have enough information to confirm that they are collecting the correct amount of debt from the correct person. As a result, debt buyers file millions of frivolous lawsuits against individuals, often without notifying the individual and without having proof of the claims. Because low-income individuals do not have the resources to defend themselves in court, debt buyers win more than 90% of these lawsuits. States can enact legislation that prohibits debt buyers from filing lawsuits without sufficient evidence. Requiring evidence about the alleged debts would significantly cut down on the number of meritless lawsuits filed by debt buyers.



News Feed

Copyright © 2016 CFED — Corporation for Enterprise Development 1200 G Street, NW Suite 400 Washington, DC 20005 202.408.9788