Debt Collection

It can be challenging to collect a debt, particularly if a debtor is actively avoiding your collection efforts. Debt collectors in Illinois must abide by federal and state laws that protect debtors and restrict what debt collectors can do in trying to collect a debt. A debt collection company that fails to follow debt collection laws can face litigation that results in monetary damages. Lenders, banks, and companies collecting their own debts do not need to follow the same laws as debt collection companies, but it is still wise for them to retain an experienced Cook County debt collection lawyer to collect a debt. Often, it is appropriate to pursue litigation to collect a debt and then follow up with post-judgment enforcement measures. Jutla Legal has over 15 years of experience protecting creditors' rights throughout Cook County, Lake County, DuPage County, Kane County, and McHenry County, including in Arlington Heights, Mt. Prospect, Rolling Meadows, Wheeling, Palatine, Buffalo Grove, Elk Grove Village, Schaumburg, Hoffman Estates, Libertyville, Barrington, Vernon Hills, Waukegan, Gurnee, and Chicago.

It may be possible to work out a voluntary agreement to settle the debt with the debtor. For instance, you may be able to negotiate a written installment payment plan with the debtor that incorporates a clause that provides for a penalty or stipulated judgment. However, if informal negotiation fails, as a creditor in Illinois, you are entitled to file a lawsuit and obtain a judgment against a debtor. Additionally, in some cases, threatening litigation brings to the table a debtor who is unwilling to pay the debt voluntarily.

The benefit of litigation is that there are a number of methods that may be used to enforce a judgment and collect a debt. For example, you may be able to place a lien on the debtor's property or garnish the debtor's wages. You may be able to serve the debtor's bank with a garnishment that requires the bank to withhold double the judgment.

A common post-judgment collection procedure is a citation to discover assets. This is a court document that requires the debtor to come to court to answer questions about their property and income. The citation freezes the debtor's non-exempt assets and allows you to understand the debtor's finances. As an experienced debt collection attorney in Cook County, Raj Jutla can help you move forward with a garnishment proceeding or pursue a charging order against a debtor's distributional interest in an LLC or other company.

Each state has its own statute of limitations on debts. In Illinois, the statute of limitations can run for 5-10 years. The statute of limitations for open accounts, such as credit card debt, is five years. You have five years from the last payment made on an account to collect a debt on an open account. In contrast, written contracts for installment loans and auto loans have a 10-year statute of limitations.

When you collect a debt, you may be restricted in how you collect it, depending on your relationship to the debtor. Debt collection companies must abide by the federal Fair Debt Collection Practices Act, the Illinois Collection Agency Act, and the Illinois Consumer Fraud and Deceptive Practices Act. To learn about how these laws may apply to you, you can consult a Cook County debt collection attorney.

The federal Fair Debt Collection Practices Act (FDCPA) provides a number of protections to debtors. It prohibits harassment and other abusive practices. The FDCPA only covers personal, family, and household debts, rather than business debts. Banks, lenders, real estate professionals, insurers, and lawyers are not covered by this law. The FDCPA also does not apply to original creditors, which are lenders or those to whom debts are initially owed.

Debt collectors — companies in the business of debt collection — must also abide by the Illinois Collection Agency Act. This law requires debt collectors to get a license. Like the FDCPA, it limits how debt collectors get in touch with debtors and restricts the actions that they can take to collect a debt. Certain types of companies and professionals do not need to follow the Illinois Collection Agency Act, including original creditors, billing companies, homeowners' associations, banks, loan companies, real estate brokers, and attorneys.

Under the state law, a debtor can ask a debt collector to validate a debt that is being collected. A debtor has 30 days from notice of the amount of the debt to dispute the debt. A debt collector must verify with the original creditor that the debt is owed, and then provide a written verification to the debtor.

Our creditors' rights and debt collection services extend throughout Cook County, Lake County, DuPage County, Kane County, and McHenry County, Illinois. To schedule a consultation or inquire further about how we may assist you with your debt collection needs in the Chicago Metropolitan area, including Arlington Heights, Illinois, call Jutla Legal, LLC, at 847-305-3034 or contact us online.