In response to the growing outcry against consumer abuse conducted by third party debt collectors, the United States Congress passed the Fair Debt Collection Practices Act (FDCPA) in 1977.
At the time, few states had enacted similar protection for consumers and the states that had passed laws did not go far enough in providing adequate legal protections.
Eventually, states such as Illinois passed consumer protection laws that prevent debt collectors from harassing consumers. The Illinois Fair Debt Collection Practices Act (IFDCPA) specifies how third party debt collectors like Malcolm S. Gerald & Associates can collect outstanding debts.
For example, if your bank sells an outstanding personal loan to Malcom S. Gerald, the debt collection agency must follow Illinois law when it comes to the late payment fees, statute of limitations, and garnishment of consumer wages to pay off delinquent debts.
What is the Statute of Limitations for Debt Collectors in Illinois?
Illinois statute of limitations law defines two types of contracts: oral and written. For debt owed for outstanding credit card balances, an Illinois court ruled credit card debt is an oral contract. The legal argument at the time was the consumer and the credit card company orally agreed to the terms of a debt.
In Illinois, oral contracts produce a statute of limitations spanning five years. For written contracts like personal loans, a third party debt collector has up to 10 years from the date of issuance to collect an outstanding debt.
Illinois Law and Debt Collection Fees
Third part debt collectors are notorious for tacking on debt collection fees, including interest charges for overdue accounts and fees for processing debt collection paperwork. Illinois allows debt collectors to seek the payment of higher fees and interest rates, if a borrower agrees in writing to pay the higher fees and interest.
State law caps the interest paid on a court ordered debt judgment at 9%. Exceptions to the 9% rule include whenever a school district or a government entity owes a debt judgment. Illinois caps public sector debt fees and interest charges at 6%.
How Does Illinois Law Influence Garnishment?
Wage garnishment can not only be a costly legal decision, it can also create tremendous embarrassment for the garnishee at home and at work. Third party debt collectors such as Malcom S. Gerald& Associates have the right to seek wage garnishments by filing a lawsuit in an Illinois court.
If a third party debt collector receives a favorable wage garnishment ruling, the agency or law firm is allowed to garnish only 15% of your disposable income. Your weekly disposable income must be at least the total of the minimum wage times 45.
Why Should I Contact a Consumer Protection Law Attorney?
If you face wage garnishment by a third party debt collector, you need to turn to a licensed Illinois consumer protection law attorney that has litigated IFDCPA cases. Your attorney can guide you through the legal process by explaining the state regulations pertaining to your case.
Hiring an IFDCPA attorney greatly increases your chances of winning a case against Malcom S. Gerald & Associates.
*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 Malcolm S. Gerald & Associates or any other third-party collection agency, you may not be entitled to any compensation.