When the United States Congress enacted the Fair Debt Collection Practices Act (FDCPA) in 1977, few states had any laws on the books protecting consumers against the aggressive tactics employed by unscrupulous third party debt collectors.
The FDCPA makes it unlawful for debt collectors to abuse and threaten consumers, as well as use deception to trick consumers into paying outstanding debts.
As one of the first states to address consumer law issues, Illinois passed legislation that filled in some of the legal holes left by the FDCPA. If Medical Recovery Specialists has contacted you regarding a delinquent debt, you enjoy several legal protections granted by the Illinois Fair Debt Collection Practices Act (IFDCPA).
A licensed FDCPA attorney can explain how Illinois law defines wage garnishment, debt collection fees, and statute of limitations.
The IFDCPA Sets a Statute of Limitations
Under the IFDCPA, third party debt collectors have a specified amount of time to collect debts defined by oral and written contracts. An Illinois court has ruled credit card debt is covered by an oral contract, which comes with a statute of limitations for collection of five years.
Written contracts in Illinois include personal bank loans. The IFDCPA mandates third party debt collectors have 10 years from the date of signing a binding contract to collect money owed on consumer debt.
Can a Debt Collector Charge Fee and Interest?
Third party debt collectors purchase debts from original creditors for a small percentage of what consumers owe. After taking over the collection of outstanding debts, many third party collectors add charges for processing paperwork.
Illinois consumer protection law permits third party debt collectors to charge fees and interest on delinquent debts, but only if consumers agree to the extra charges in writing.
Debt collectors in Illinois must abide by a 9% maximum interest charge, except in cases involving public sector borrowers such a school district of government agency.
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Wage Garnishment in Illinois
The garnishment of wages can severely impact the capability of consumers to put food on the table and meet monthly housing expenses. However, third party debt collectors like Medical Recovery Specialists can seek court approved judgments that give the legal green right for garnishing consumer wages.
Illinois uses a formula that is 15% of a consumer’s disposable income or the total of the minimum wage times 45, whichever is the lower amount. If the federal minimum wage is $9 and a consumer earns $1,000 per week in disposable income, a debt collector can garnish the lower amount of $150.
Work with a FDCPA Attorney to Protect Your Rights
Between the FDCPA and IFDCPA, consumers enjoy several legal protections against the unethical actions of third party debt collectors. The legal protections mean nothing until you seek the counsel of an experienced consumer protection law attorney that has litigated numerous debt collection cases.
Hiring a FDCPA attorney increases the legal odds in your favor when it comes time to file a claim in court against Medical Recovery Specialists.
Additional Resources
*Disclaimer: The content of this article serves only to provide information and should not be constructed as legal advice. If you file a claim against Medical Recovery Specialists or any other third-party collection agency, you may not be entitled to any compensation.