Debt collection laws Nebraska: Consumer rights and how to seek legal remedies

Generally, both nationally and in Nebraska, the FDCPA governs the lawful methods that debt collectors may use to try to collect debts. The FDCPA is applicable to anybody or any organization that frequently collects debts, including firms that purchase debts and attempt to collect them.

What is FDCPA?

FDCPA stands for Fair Debt Collection Practices act; it is a federal law that offers you protection against harmful practices frequently used by debt collectors. This law seeks to establish in plain terms what a collector can and cannot do. However, remember that the FDCPA does not apply to debts incurred during the course of a business's operation. This is a crucial distinction to make.

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Your rights as a consumer, according to FDCPA

1. A debt collector is allowed by law to contact you at any time of day and in a variety of ways. If a debt collector follows the regulations and lets you know that they are doing so, they are permitted to get in touch with you via phone, letter, email, or text message to try to collect a debt.
2. Unless you consent to get contacted during certain hours, a debt collector may not contact you during unfavorable times or locations, such as before 8 a.m. or after 9 p.m. If debt collectors are informed—verbally or in writing—that you do not wish to be called at work, they are not permitted to contact you there.
3. A debt collector must also give you a validation notice in writing within five days of getting in touch with you for the first time. The validation notification must include information about the debt's amount, the creditor to whom it is owed, and your options if you disagree with the debt's validity.
4. Keeping a record of every conversation you have with a debt collector is always a brilliant idea. Keep copies of any correspondence or papers you submit to or receive from debt collectors. Keep a written record of the dates, times, and subjects of every discussion you have with the debt collector.
5. Tell the debt collector in writing to stop contacting you if you decide you do not want them to contact you again. The best course of action is to draft a letter to the collector, make a copy for your records, and mail the letter certified mail with a return receipt request.

The only occasions a debt collector may contact you after receiving your "no contact" letter is to let you know that there will be no more contact or to inform you that the collector or creditor intends to pursue a specific action, such as filing a lawsuit.

While sending a "no contact" letter to a debt collector won't eliminate the debt, it will stop the unwelcome contact. Remember that the debt collector may still file a lawsuit to recoup the debt.

You should submit a letter disputing the debt or demanding verification of the bill if you think a debt collector is attempting to demand money on a debt that you do not believe you owe. After receiving the validation notification from the debt collector, you have 30 days to send the letter.

After receiving the letter, the debt collector is required to stop contacting you but may do so again if they produce formal proof of the debt. A copy of your bill showing the amount you owe could be included as written confirmation of the obligation.

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Violation of FDCPA

1. Debt collectors are prohibited from using violent threats, using profane language, publishing a list of debtors (although they are permitted to report to credit bureaus), or calling someone frequently just to annoy them.
2. Debt collectors are not permitted to tell lies while attempting to collect a debt. Be aware of debt collectors who make false claims that they are government officials or attorneys, who assert that you have committed a crime, or who inflate the size of your obligation. Debt collectors aren't allowed to contact you without first identifying themselves.
3. Debt collectors aren't allowed to tell you they're going to sue you if they don't plan to. Additionally, debt collectors are prohibited from threatening to take your money or property unless they have the necessary legal standing to do so.
4. Debt collectors are prohibited from using a fictitious corporate name, sending you documents that appear to be from a court or government agency, or providing anyone with fraudulent credit information or any other account history pertaining to you.
5. Debt collectors are prohibited from attempting to collect additional amounts from you, such as interest or fees unless the state law or the agreement that caused the debt expressly permits it. Furthermore, they are not permitted to call you by postcard or deposit a postdated cheque early.

It's crucial to keep in mind that you have the right to receive calls from debt collectors that are truthful, respectful, and fair in all of their interactions with you. You are liable for statutory damages of up to $1,000 and actual damages if it can be established that the collector breached the FDCPA and you did not.

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When debts get too old to collect: Statute of limitations

There are several affirmative defenses you can consider if you are being prosecuted for money owed. The statute of limitations can be invoked as one of these defenses. The statute of limitations is a deadline after which you can no longer be sued for consumer debt.

The statute of limitations can be used by consumers who are being sued to prevent further litigation during a debt collection effort. The statute of limitations has a different time limit in every jurisdiction, but it normally lasts between four and six years. The statute of limitations on debt prohibits collectors from collecting money for a debt that has expired.

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Nebraska statute of limitations on debt collection

The Nebraska statute of limitations for consumer debts is five years following the final payment. This means that when five years have elapsed, a creditor or debt collector cannot file a lawsuit against you for that lapsed debt.

In Nebraska, this period is shortened to four years if the agreement is verbal. In Nebraska, the statute of limitations for mortgage debt resulting from foreclosure is up to ten years. Contract or promise, express or inferred, in writing, is five years for foreign judgments. The statute of limitations for express or implied unwritten contracts is four years.

Re-aging debt even after it has crossed the statute of limitations.

A voluntary payment on a past-due obligation restarts the Nebraska statute of limitations after it has been made. This means that if you make a voluntary payment on a debt, even while the statute of limitations has not yet run out, the clock will start ticking anew. The five-year statute of limitations will then begin again. This enables the debt collector to file a lawsuit against you and take you to court.

Debt scavengers are debt collectors who look specifically through old debts to collect on them, and this includes medical bills. This is why it's critical to be aware of the obligations you owe, when you last paid them, and any potential repercussions of either paying or not making payments for a loan.

Can a debt collector sue you for a past-due debt?

Although a creditor or debt collector cannot sue you for a debt, they are still able to collect on it, thanks to Nebraska's statute of limitations on debt. This implies that even if you aren't taken to court, they might still get in touch with you. In the debt-collecting business, it's normal practice to purchase debt that has passed its statute of limitations.

Debt collectors and past-due debt

Usually, debt collectors buy expired debts at a steep discount. After that, these debt collectors make an effort to intimidate or manipulate customers into paying off these debts. Most consumers are unaware of the legal ramifications of the issue, even though you cannot be taken to court for the debt.

The fundamental paperwork needed to establish you are responsible for the debt is never provided by creditors that buy these kinds of loans. They cannot sue you for your debt for this reason, but they may still go after you to collect it.

Common debt collection tactics for expired debts

Debt collectors employ a variety of strategies to persuade debtors to make payments on an expired debt. The same methods are employed to collect debts that are not yours or that have already been forgiven in bankruptcy. The goal of all of these strategies is to extend the statute of limitations and resuscitate the debt.

The tactics they commonly employ are as follows.

• They insist you settle the expired debt for a small sum in exchange for them "leaving you alone."
• In exchange for a nominal payment, they guarantee not to include the debt in your credit report.
• They make threats to sue you or deliver a lawsuit to you. The statute of limitations on debt prohibits creditors from taking such actions.
• They make threats to re-age an expired debt on your credit report.
• They might abuse you verbally or continue to harass you by calling repeatedly or by any other method.
• They may falsely identify as a "litigation" firm.

How debt collectors can report a debt to the credit bureaus

Before a debt collector can contact a credit reporting agency to include the debt in your credit report, the debt collector must first talk with you in person or over the phone. They can either mail you a letter about the debt and wait a certain amount of time which is typically 14 days, after which they can send a notice that the letter wasn't delivered.

Alternatively, they can send you an electronic communication regarding the debt and wait a reasonable amount of time (typically 14 days) to be able to send a notice that the message wasn't delivered. If a debt collection agency delivers you a validation notice regarding a debt, it signifies they have met their obligation to get in touch with you and can, in general, report the debt to credit reporting agencies. Only after this can a debt be included in your credit report.

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Don't let debt collectors push you around.

Your best option if you're dealing with debt collectors who employ the aforementioned strategies would be to ignore them. If the debt has been listed on your credit report, you can verify your credit report, but if they continue to pursue you, you may be able to sue them under the FDCPA. Don’t let yourself be manipulated by debt collectors or collection agencies.

What to do when faced with a lawsuit for a time-barred debt

After five years, Nebraska's debt statute of limitations prevents creditors and debt collectors from suing you. In spite of this, debt collectors might still try to sue you. This is done in the hopes that being sued will make you pay off your debt. The fact that you can combat this is advantageous for you.

How should you respond to a summons for debt collection in Nebraska?

Your first instinct might be to ignore a summons when you first receive one in the mail. This is a wrong move. When being sued for an expired debt, it is crucial to submit a written answer. This written response explaining that the debt the creditor is attempting to collect is an expired debt should be submitted to the Nebraska court clerk. Simply state that you are using this as a defense against the lawsuit and that the debt has exceeded the Nebraska statute of limitations.

• Ask for documented proof.

  Your next move is to request an account history regarding the debt after submitting an official Answer. The law requires any creditor or debt collector to present proof of your debt before proceeding. The creditor agreement must be original. They must also provide evidence that you made payments on the obligation during the previous five years if the debt is older than that.

  The supporting documentation must include the date on which the payment was made, the amount paid, and the mode of payment, such as cash, check, or bank transfer. Any judge should dismiss the claim if this evidence cannot be presented.

• File a counter lawsuit

  The Fair Debt Collection Practices Act forbids creditors from taking any legal action against you after the debt's statute of limitations has expired. A debt collector breaks the law when they sue you for an old debt, and this enables you to file a counterclaim for legal fees and punitive damages of up to $1,000.

  Being harassed by a debt collector can be stressful. Consumers are protected from harassment and other abusive tactics by the Fair Debt Collection Practices Act. To safeguard consumers from unfair collection tactics, some states have passed their own legislation. There are some state legislations that debt collectors must abide by in Nebraska.

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Nebraska statutes related to debt collection

The Nebraska debt collection statute applies to collection companies; however, it does not apply to attorneys who handle claims on their behalf or who do not run a collection firm with its management made up of lay persons. It follows that a lawyer will not fall under the purview of this statute if they actually use the legal system to recover debts.

However, Nebraska law will have jurisdiction over the attorney if all they are doing is renting out their name to a collection agency. The law is a licensing law and calls for the collector to hold a license in order to collect in this state. Private remedies, however, are not mentioned.

Another piece of Nebraska legislation focuses especially on licensees of installment loans. This regulation restricts how a lender can communicate with customers and other parties, forbids specific abusive and harassing behaviors, and loosely follows the FDCPA. Actual losses and liquidated damages of $500 to $1000, in addition to attorney's fees and costs, are covered under private remedies.

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Closing thoughts

You do not have to put up with mistreatment from a debt collector who has engaged in harassing, abusive, or unethical activity. Speak to a lawyer right away.

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Disclaimer: This article is for informational purposes only and does not constitute legal advice. Please consult a qualified attorney for advice on your specific situation.