Finding yourself unable to pay bills on time can have a devastating effects both personally and financially. Once some debt goes unpaid and moves into collections, other debt tends to head in that same direction. This seems especially true when a consumer is unable to pay due to personal life events such as, loss of a job or a death in the family.
What can be even more stressful in experiencing financial hardship, is being approached by debt collectors employing every strategy they can, in an effort to collect outstanding debt from the consumer. The best tool a consumer can have to work through the circumstances of being placed in collections and contacted by collectors is knowledge – knowledge of their rights under the law, and knowledge of strategies they can use when dealing with debt collectors.
Get to Know Midland Credit Management
One such collector, Midland Credit Management, a collection agency owned by publicly traded Encore Capital Credit Group, will employ a variety of tactics to secure payment for outstanding debt. Understanding who Midland Funding LLC is and what their reputation consists of will help consumers who are forced to deal with them communicate in a way that best protects themselves.
Midland Credit Management, aka Midland Funding, has been in business since 1953, and has been on file with the Better Business Bureau (BBB) since 1992. It is based in San Diego, but like all other debt collectors, purchases debt accounts from a variety of lenders everywhere and then pursues consumers for collection of those accounts.
Midland has an A+ rating with the BBB, and has been given 3.7 out of 5 stars for its business practices. Despite that, 67 negative reviews of Midland Credit Management reside on the BBB website alone. That’s not taking into consideration the numerous complaints about the company on other consumer advocate websites.
The number one complaint against Midland is that it breaks promises made, or acts on debt that is full of error or completely false. According to the BBB, in 2015, a court case was settled between the Consumer Financial Protection Bureau and Encore Capital Group (Midland’s parent company) over the allegations that “the business bought debts that were inaccurate, lacked documentation,and unenforceable and collected payments from consumers using false statements and false court documents. Under terms of the Assurance, the business agreed to refund consumers $42 million, pay a $10 million penalty,and stop collecting over $125 million worth of debts.”
Although settlement of the dispute does not admit guilt, this case — combined with the wealth of consumer complaints made in the last decade provides a clear indication that Midland may be engaging in practices that violate consumer rights under the FDCPA (Fair Debt Collection Practices Act).
The FDCPA is a federal law passed in September 1977 to help protect consumers from a high prevalence of predatory debt collection practices that were often abusive in nature. The Act set out specific requirements that clearly defines the types of practices lenders and debt collectors can and cannot employ in attempts to collect a debt. Violation of any of these requirements is prosecutable under the law.
Know Your Rights
According to the Fair Trade Commission (FTC), the FDCPA restricts lenders and debt collectors from engaging in the following practices:
“Debt collectors may not harass, oppress, or abuse you or any third parties they contact.”
- Threaten violence or harm
- Make public names of those consumers who refuse to pay (exception: giving the information to the credit reporting companies)
- Use inappropriate/obscene language
- Repeatedly use the phone to annoy or harass
“Debt collectors may not lie when they are trying to collect a debt.”
- Say they are attorneys or government representatives when they are not
- Tell the consumer he/she has committed a crime
- Lie by saying they operate or work for a credit reporting company
- Misrepresent the amount of debt owed
- Say letters or paperwork they have sent are legal papers
- Say papers they’ve sent aren’t legal forms when they are.
- Tell a consumer they will be arrested if they don’t pay
- Say they will seize, garnish, attach, or sell a consumer’s property or wages unless they are permitted by law to take the action and intend to do so
- Say they will take legal action against a consumer, if doing so would be illegal or if they don’t intend to take the action.
“Debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt.”
- Give false credit information about a consumer to anyone, including a credit reporting company;
- Send a consumer anything that looks like an official document from a court or government agency if it isn’t
- Use a false company name.
“Debt collectors may not engage in unfair practices when they try to collect a debt.”
- Try to collect any interest, fee, or other charge over the amount owed unless the contract that created the debt, or state law, allows the charge;
- Deposit a post-dated check early
- Take or threaten to take property unless it can be done legally
- Contact a consumer by postcard.
If you find yourself in the position of having to deal with Midland Funding or any other debt collector, there are specific steps you can take to protect yourself while communicating with them. First, let them know you will only be corresponding with them in writing, and that they are not allowed to call you anymore.
Lastly, if you settle for removal (paying an amount less than the total owed in exchange for your record being removed from Midland’s report to the credit bureaus), make sure it is in writing. One of the many complaints against Midland is that they promise to settle for removal, and then do not. If you don’t have it in writing, it is essentially their word against your own.
Dealing with debt collectors can add to the immense amount of stress already felt from falling behind on debt repayment. Knowing your rights and the specific measures you can take when dealing with debt collectors, will help give you some breathing room when you can start the process of recovering from bad debt.