Written by Canterbury Law Group

The Truth about Holiday Season “Bad Credit” Loans

The holiday season is finally over. Among the flurry of deals and discounts consumers typically get when shopping, there are also seemingly lucrative deals for borrowing money. Most consumers use credit cards or otherwise borrow money to spend during the holidays, hoping to pay it all off next year. Not everyone gets their yearly bonus in advance. Arizonians and Americans, in general, have a very complicated relationship with debt. Consumers can be highly unrestrained when it comes to borrowing money. This is why most people still end up with so-called “bad credit” loans that they can’t pay off. Borrowing money when your credit score is already low can send you spiraling straight into a debt trap. Therefore, when you see advertisements for payday loans or bad credit loans, keep the following information in mind:

“Bad Credit” Loans May Come with Sky High-Interest Rates

These bad credit loans are a form of payday loans. Lenders that offer loans like this target borrowers who are ineligible for conventional loans because of existing debt. If a person’s credit score is low, it indicates prior debt problems, and possibly even personal bankruptcy. Legitimate lenders, like banks, do not typically allow people with bad credit to borrow more. Additionally, people with bad credit may have been maxed out of credit cards. So this group of borrowers is desperate and ripe for exploitation.

Loans for borrowers with bad credit are easy to get, but not so easy to pay off. These loans do not typically require collateral but come associated with sky-high interest rates akin to typical payday loans. Unless you pay off one of these loans right away, you may end up with serious debt next year.

What to Do When You Have Too Much Unsecured Debt

If you are nose-deep in debt because of unsecured loans, there are still positives to look forward to. These loans have no associated collateral, so you don’t have to worry about losing a house or a car. If the debt has piled up high and you can no longer afford to pay it all back, then you can consider filing for bankruptcy. Under Chapter 7 bankruptcy law, unsecured debt, including payday loans, can be discharged. Consult a bankruptcy attorney in Scottsdale to know if you are eligible for a Chapter 7 filing.

Bankruptcy is not the only option to consider. Debtors can negotiate with creditors to bring down the interest rate or pay only a part of the loan. If a creditor is verbally abusive towards you demanding payment, you can file a creditor harassment complaint. There are new protections for consumers against loan sharks who mislead borrowers about financial tools like bad credit or payday loans. In these situations, you can find debt relief with legal assistance.

Avoiding Bad Credit Loans in the New Year

You don’t have to file for bankruptcy or hire a lawyer if you are not in debt. Therefore, the best way to avoid being burdened by personal loans in 2018 is not to borrow them in the first place.

If the debt is an issue, don’t borrow more to finance more shopping or vacations. Save money instead. If you are in dire need of credit, consider obtaining a legitimate loan where the interest rate is not so high.

Written by Canterbury Law Group

How to Protect Yourself against Creditor Harassment in Arizona

If you are far behind on a loan payment, you can expect the collection calls to start. However, if the collection calls are very frequent and disrupt your life, or the calls are threatening in any manner, then it can be considered harassment. Many indebted Arizonians face harassing calls and other harmful collection efforts from creditors. Here are several steps you can take to stop the abuse.

Try to Negotiate with the Creditor

The easiest and cost-free solution you can take is to try to negotiate with the creditor to settle the debt. Instead of not picking up the phone, in which case the creditor will find other ways to reach you, or ignoring calls, talk to the creditor directly. If your finances are too tight to pay back your loans, discuss it with your creditor and you may be able to come to new terms. Depending on your negotiating skills, and the creditor’s willingness, you may be able to get a payment extension, a reduced interest rate or a waiver or both.

If the creditor is particularly abusive, it is probably best not to engage should the behavior gets worse on the part of the creditor.

Call a Lawyer Immediately

It’s highly recommended to call a bankruptcy lawyer in Scottsdale or your local area to put a legal stop to harmful third party collection efforts. There are attorneys who specialize in providing relief to those who suffer from abusive creditors. No matter how much you owe, creditors cannot harass you as a part of their collection efforts. There are both federal and Arizona state laws to protect debtors against harassing creditors.

Protection is granted to consumers under the Fair Debt Collection Practices Act (FDCPA). The law outlines personal rights when it comes to debt collection practices. You can consult with a lawyer to find out whether any of your rights under FDCPA has been violated. The lawyer will be able to tell you if the behavior you have endured from the creditor can be considered a legitimate collection effort and what remedies you may have under the FDCPA.

You Can Sue if You are a Victim of Abusive Practices

If you know that you have been subjected to illegitimate collection efforts or practices that can be considered harassment, you can sue the creditor in question with the help of an attorney. The collection practices in question may be considered a violation of either state or federal law.

Harassment, in general,  that involves constant phone calls, multiple phone calls on the same day, auto dialing calls and calling without leaving messages can be considered unfair practices. If the debtor calls your friends, family, employer or another third party regarding your finances, then it is a violation of the law.  Other common creditor harassment practices include the use of threats, such as a threat to call the police on you, charging even more in addition to the debt such as late fees, not validating the debt or continuing to contact you after you have clearly stated your intent to refute the debt. If you have been subjected to any of these, you can take your case to court.

Additionally, filing for personal bankruptcy can relieve you of harassing debt collection efforts literally overnight.  Speak with a seasoned bankruptcy attorney to evaluate your many options. Call us at 480-240-0040 for more help on these issues.