A Few Good Reasons To Sue Your Creditor

A Few Good Reasons To Sue Your Creditor

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You have legal rights than protect you from creditors. Some of these legal rights are explained under the Fair Credit Reporting Act and the Fair Debt Collection Practices Act. There are a few questions that should be answered in regards to claims you can have against your creditors. The first question that comes to me often is the one of "What can you sue a creditor for and when can you sue them?" To answer the question there are many different things you can sue a creditor over. One is suing them because of reporting false or inaccurate history to your credit. This claim is one of defamation or financial injury. The Ninth Circuit US Court of Appeals addressed this issue in Nelson v. Chase Manhattan in Case No. 00-15946. The court claimed that chase was responsible for damages for wrongs that took place.

Another thought that people have is suing the creditor for falsely reporting a disputed account to the credit bureaus. The answer again is yes. Yes you can sue the creditor if you have disputed a debt, and they have failed to report it as disputed account to the credit bureaus. Section 623 of the Fair Credit Reporting Act gives you specific reasons to sue a creditor. The fine for this erroneous credit reporting to your creditor is $1000.

Unlawful impermissible pulling of ones credit file is Another reason to sue a creditor. This one typically occurs with collection agencies. When collecting on a debt, Collection agencies routinely pull credit for accounts that are in default. This can happen once the creditor has allocated the account to a third party debt collector. Once the account has been allocated to a third party collector who is not the original creditor the creditor has given up their right to collect on the debt. Therefore if the collection company who you have never heard of before attempts to collect on that debt they had better validate that you owe them money or it would follow that they have no right to do a credit inquire on your credit history.

A valid contract must be showed which proves the assignment of the account to the collector was authentic or you will have a tough time knowing with a surety that the third party debt collector is the real holder in due course (the only person with rights to collect). (Collection agencies are not in the business of lending money and frequently more than one company at a time tries to collect on debts) The law states in the Fair Credit Reporting Act under Section 604 injury to your credit report and credit score is a $1000 fine. I don't know about you but if credit is pulled without permission and the creditor cannot verify that you gave them permissible purpose then I would consider a claim against them. The citing case law is Cushman, v. Trans Union Corporation v. US Court of Appeals in the Third District Court 115F.3d220, June 9, 1997, Filed (D.C No. 95-cv-1743)

In summary there are many reasons why someone could sue their creditors. Next time you are dealing with a collection agencies be sure to think twice about your defenses and course of actions.

About the Author:
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