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Debt Collection Matters in Massachusetts: Understanding the Laws
Your debtors will not always honor their financial commitments. This can push your business to the wire. You can decide enough is enough and seize their property, but your business needs these customers as much as it requires the debts they owe you. You also have to ensure that every action in the debt recovery process is within the applicable laws. That is what makes debt collection a sensitive process.
Massachusetts has debt collection laws. Some of these laws are significantly different from those of other states. When recovering a debt in Massachusetts, it is essential to ensure that all your actions are within these laws. It might be easier to hurriedly auction the debtor’s property and recover your debt in record time. However, it might cost you more than the debt you are recovering if the debtor initiates legal action against you. This article will discuss some of the critical laws you need to keep in mind when recovering your debts.
Massachusetts Fair Debt Collection Policies
Besides the federal Fair Debt Collection Policies, Massachusetts has its rules that limit the actions of both creditors and debt collection agencies. Compared to the federal policies, the Massachusetts version gives borrowers and debtors more rights. It is also more specific. The prohibited debt collection practices are discussed later in this article.
Statue of limitations
In Massachusetts, the statue of limitation for civil debts is six years. This means that the creditor can only initiate the debt collection process within six years of the last payment date or the due date of the loan. This law applies to both oral and written contracts.
Creditors and debt collection agencies should know that not all property can be sold to recover a debt. The federal law prohibits the seizure of items such as furniture, clothing, and domestic appliances up to a specific value. On top of that, Massachusetts law adds other items such as cemetery plots. It also places a cap on the value of things such as books and livestock that can be sold to recover a debt.
Unfair Trade Practices
Massachusetts Unfair Trade Practices law complements the federal law that governs business transactions. These laws are put in place to minimize unfairness and deception in business deals. To be on the safe side, you have to ensure the process of debt collection does not violate the unfair trade practices law. Some of the prohibited actions are
- Unfair and inaccurate credit reporting
- False claims and representations
- Selling goods on credit or giving out loans without adequate disclosure of the terms and conditions
Locating debtors in Massachusetts
As a creditor, you are expected to maintain the current contacts and addresses of your debtors. Nevertheless, if the details you have are misleading or inadequate to locate the debtor, Massachusetts law allows you to contact other parties other than the debtor and their families. You should only exchange information that will help you find the debtor with the other parties. For example, don’t tell them you are looking for the debtor because they have failed to pay their debts.
Fair debt collection policies in Massachusetts
As earlier stated, the Massachusetts Fair Debt Collection Policy is an extension of the federal consumer protection laws. It outlines the actions that are prohibited for creditors and debt collectors while collecting debts. The major and commonly abused sections of the Massachusetts Fair Debt Collection Policy are discussed below.
Contacting the debtors
- Whenever you call the debtor, you should adequately identify yourself.
- If a lawyer represents the debtor, you should not contact the debtor directly.
- You should not call the debtor outside the regular waking hours. The regular waking hours are between 8.00 a.m and 9.00 p.m. The debtor should inform you if their waking hours are different.
- You should not call the debtor more than twice within seven days for each debt.
- If the debtor has requested, don’t call them while at work. Written requests are valid until the debtor cancels them while oral requests are valid for 10 days.
- You should not visit the debtor’s home outside the regular waking hours. Furthermore, unless permitted by the debtor, you should not visit their home more than once within 30 days.
- Avoid using abusive language.
Collecting the debt
- You should not make false or misleading statements.
- You should not attempt to recover more than what you are owed. Furthermore, Massachusetts law imposes caps on the seizure of assets such as livestock. Make sure you are within limits.
- Never threaten the debtor with actions that are not legally enforceable or moves you don’t intend to take. For example, don’t tell the debtor you will auction their property if such a move is not legally enforceable.
- You should not cause unnecessary expenses to the debtor. Such expenses include wire charges, long distance calls, and express mail charges.
Massachusetts Debt Collection Attorneys
Why your choice of debt collector matters.
Collecting debts by yourself might be overwhelming. Even when you are doing it by yourself, you need to consult a Massachusetts debt collection attorney for legal advice. Remember if the debt collection is not done per the law, you might be forced to compensate the debtor. You need to select a debt collection attorney who will recover your debt without giving your business a bad reputation.
About Massachusetts Commercial Debt Collection Attorneys
We are a team of debt collection attorneys with a combined experience of more than 50 years. Our energetic attorneys have recovered hundreds of debts for different types of clients. Some of the qualities that set us apart from our competition are
- We give regular updates to our clients. Furthermore, we give our clients the freedom to accept or reject the debtor’s offers.
- We don’t accept all cases brought before us. We thoroughly evaluate the circumstances surrounding each case before accepting to handle it. We don’t give our clients false hope.
- We make professional contact with the debtor to demand payment. We value your relationship with your clients.
- Our pricing is straightforward; there are no hidden charges. We give all our clients a written fee agreement.
- Aggression. The goal of our attorneys is to bring your money back to your pockets. They rarely rest until they deliver.
At Massachusetts Commercial Debt Collection Attorneys, we offer a free consultation. If you need a quick and professional recovery of your debts, contact us today.