Debt Collection Laws in Montana - Federal law to deal with debt collectors

Montana primarily relies on federal debt collection regulations and state laws offering broad consumer protection. If debt collectors violate their legal rights, consumers can seek assistance from the Federal Trade Commission, a debt settlement lawyer, or the Montana Attorney General's office.

Montana debt collection laws - What they can't do

In Montana, debt collectors are prohibited from the following while still acting within the statute of limitations:

If you've requested them to stop contacting you in the network facility, they can't call you or contact you in any other manner. They cannot call if instructed not to contact you while you are at work.

The debt collector is not allowed to speak to you, your friends, or your family about your debts in a threatening or vulgar manner.

They cannot pose as law enforcement to force you to settle debts.

Debt collection agencies and creditors can only collect fees and penalties as high as what is owed (i.e., padding their pockets for enhanced profit).

Federal Fair Debt Collection Practices Act (FDCPA) in Montana

The FDCPA tells collection agencies across the US what they can and can't do. They can't tell your employers that you owe money to other people. They also can't try to charge you more in fees than you owe. They can't call you before 8 a.m. or after 9 p.m., either.

You can file a counterclaim if you can show that the debt collection company did any of the above. If you win, the debt collection company might have to pay your legal fees and other costs.

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Tips for dealing with debt collectors in Montana

Ask for debt validation

You can send a "Debt Validation Letter" to the debt collector if they don't write down all the information required by federal law. From this site, you can get a Debt Validation Letter.

Dispute debt

You can send a "Debt Dispute Letter" to a debt collector within 30 days of getting written notice of a debt. You might hear from the debt collector again when they send proof that you owe money. After they send you proof of the debt, the debt collector may try to get you to pay again. From this site, you can get a "Debt Dispute Letter."

Take notes

To protect your rights, it's a good idea to write down all of your phone calls with debt collectors. Download our checklist for when debt collectors call.

Send a cease and desist letter

After getting a "cease and desist" letter, a debt collector can't contact you for any reason other than to say they won't contact you again or will do something else, like go to court. Even if a debt collector gets a letter telling them to stop contacting you, they can still sue you in court and get a money judgment against you. But if you can't be collected, a debt collector might not be able to get the money.

Create a repayment plan

You can talk to debt collectors and try to work something out. If you can't make a plan to pay off your debt, the debt collector may take you to court. The judge may then give court judgment and order you to pay the total amount, plus the costs of the lawsuit and maybe even attorney fees.

If you don't have money to pay off unsecured debt, you can enroll in a Montana debt settlement program to cope up with your delayed payments. The debt settlement companies will help you eliminate the total debts owed without repaying the full amount. They will negotiate with creditors out of court as per Montana law and get a written acknowledgment signed for debt settlement. Once done, you can pay the agreed-upon amount and get out of debt.

Some federal laws say a debt collector can't sue someone to collect on an old debt after a specific time has passed. "Statute of limitations" is the name for these laws. If you make a payment on an old debt, you can start the clock over again. Laws about how long you have to pay a debt are complicated, so you should talk to a lawyer before you pay off an old debt.

Make sure all agreements are written down. When you talk to a debt collector, use your best judgment. Before paying back an old debt, you should speak with a lawyer about the statute of limitations. You can also find out which bills to pay when you can't pay all of them.

Go for credit counseling

The Department of Housing and Urban Development (HUD) trains and certifies housing counselors for non-profit organizations nationwide. Because of this, you can be sure that a housing counselor who HUD has approved knows how to help you understand and weigh your options. Housing counselors approved by HUD can help with credit problems, renting, foreclosures, missed payments, and buying a home. You can find a counselor near you who is certified by HUD.

The debt collector may eventually bring a lawsuit against you if they do so within Montana's statute of limitations. Replying to the debt collection lawsuit is crucial rather than ignoring it. If you choose to ignore it, the debt collector succeeds, and they'll likely start pursuing your earnings and bank accounts.

The good news is that you have options for retaliation. You cannot contact the debt collector in Montana to get information once you have been served with a lawsuit; everything must go through the court. You can take the following actions in your lawsuit response:

Refrain from acknowledging that you owe what they claim you owe. You should demand that the debt collector show evidence that you are responsible. Have them demonstrate your identity as the debtor and your ability to pay the total amount they are claiming you owe.

To ensure that the answer is submitted on time, submit it in person to your local court clerk.

• The court clerk can stamp a copy of your answer in writing.
• Send it to the debtor by mail along with a return receipt.

Questioning their legal authority to pursue and sue you is a different strategy for responding to the lawsuit. You can utilize debt collection techniques against them at this point. You see, many debt collection agencies and firms buy the majority of unpaid accounts that have been outstanding for a long time. They might not have all the supporting documentation required to demonstrate your debt and its full amount.

The debt collection agency has the burden of evidence, not you. It's possible that the creditor won't always be able to provide the documents if you want them to. The judge may decide to have sufficient evidence and dismiss the case if that is the situation.

For instance, if a debt collector in Montana claims that you owe $14,000 on credit card debt, you should ask for documentation proving that you opened the account and that you are responsible for the debt. The documentation must demonstrate that you used the card and that you owe that much money.

When you force a debt collector to present documents they don't have simple access to, some will just give up on you. Making them work hard to sue you is the plan. If they do, they might choose to hunt for simpler prey. Use every legal tool to stop them from spending money to find you!

You should have a clearer sense of what to do next now that you are more informed about Montana's statute of limitations and other facts on debt collection. Remember to respond when a debt collector sues you since you may win the case.

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Montana statute of limitations

If you live in Montana and are being chased by debt collectors, it is important to get a general idea of how the state's law on debt collection works. Why? Because if the debt collector can't take you to court to try to collect on the debt because the statute of limitations has passed, it means that you no longer owe the money.

The statute of limitations will differ depending on the type of debt owed in Montana.

For example, the following debts have different statutes of limitations:

• Written contracts - 8 years
• Oral/verbal contracts - 5 years
• Open accounts - 5 years
• Judgments - 10 years

If a debt collector in Montana does something after the statute of limitations has passed, you can almost always get the lawsuit dropped. Note that the clock on the statute of limitations starts when you last used an account to do something, like buy something or make a payment.

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What else you can't forget about how to deal with debt collectors in Montana

As long as the debt collector is working within Montana's statute of limitations, they may sue you for certain debts in the future. It's important not to ignore the lawsuit but to answer it. If you don't pay, the debt collector wins and will probably go after your wages and bank account.

There are things you can do to fight back, which is good news. Once you have been served with a lawsuit, you can't call the Montana debt collector to talk about it. Everything has to go through the court. Here are some things you can do to answer the lawsuit legally:

Don't say that you owe what they say you owe. Instead, you should make the debt collector show you owe the money. Make them show that you owe the debt and that you owe the exact amount they say you do.

Send the answer to the court clerk, preferably in person, to ensure it arrives on time.

• Get a copy of your answer that the clerk of court has stamped.
• Send it to the person who owes money with a return receipt.

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Can debt collectors or creditors take my home in Montana?

If you owe money on your mortgage to the bank, the bank may be able to take your home through a process called foreclosure. Talk to a lawyer immediately if you are behind on your mortgage payments.

You can keep unsecured creditors from taking up to $364,000 of the equity in your home. After 2022, this amount goes up by 4% every year. Unlike a mortgage, you don't have to put anything you own up as collateral for unsecured debts. Like medical bills or credit card bills. Home equity is the difference between the value of your home and how much you still owe on your mortgage.

Your home is not automatically protected. To protect your home equity up to $364,000, you must file a Homestead Declaration (or more after 2022). To learn more about a Homestead Declaration, click on this link.

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Can debt collectors take my car in Montana?

Remember that the rules are different if you still owe money on your car loan. You can't have more than $4,000 invested in your car to be exempt. "Your interest" means the difference between the sale price of the car and any loans you still owe on it. The sale value is not how much you paid for it but how much you could sell it for now.

Example 1:

You paid $6,000 for a car. You could only get about $5,000 for it right now. You still have $2,000 left to pay on your car loan. Take $5,000 and subtract $2,000 to get $3,000 in interest. Since your interest is less than $4,000, your car is exempt.

Example 2:

You paid $10,000 for a car. You could still get around $8,000 for it. You still have $2,000 left to pay on your car loan. Take $8,000 less $2,000 to get $6,000 in interest. Your car is not exempt in this case because your interest is more than $4,000.

But selling a used car comes with risks and costs. So, if your interest is close to $4,000, a debt collector may decide that taking your car is not worth it. But remember that the debt collector is the one who decides. According to the law, they can. If they take your car, they must pay you $4,000.

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Can debt collectors take my stuff in Montana?

Up to $7,000 worth of your personal property is not taxed. Things like furniture, appliances, jewelry, clothes, books, guns, pets, and musical instruments are all examples of personal property. One item can't be worth more than $1,250 for it to be exempt.

When you sell personal property, there are risks and costs, just like when you buy a car. Also, people often put too much value on their property because they paid for it, and it's near them. When figuring out how much your personal property is worth, consider how much you could get for it at a garage sale or pawn shop.

If your debt is close to $7,000, a debt collector may decide that taking your personal property is not worth it. But remember that the debt collector is the one who decides. According to the law, they can.

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Conclusion

Like many other states in the United States, Montana has laws regulating debt collection practices. These laws are designed to protect consumers from abusive and unfair practices by debt collectors. If a debt collector contacts you and believes your rights are being violated, you must know your rights under the law and take action to protect yourself.

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