There are laws in place in the state of Florida that dictate when collectors can try to get payments on unpaid debts. The laws not only lay out when money can be collected, but also state when court action can be started on old debts. Federal law dictates that lawsuits must be filed in the debtor’s home state, or where the debt was incurred. This means that it is up to the creditor to travel to where debt was incurred.
Consumers have the right to try and work with their creditors to work out payment schedules or amounts that are less than what was originally owed. This is called debt settlement. There are laws in place to protect personal loans and credit cards.
Florida offers debt settlement as an option for people struggling to keep up with payments. In order to save money people who owe money will often take settlement regardless of the adverse effects. Some of the negatives associated with settlement include are the damage to credit score, and there is a fear of the creditors launching a lawsuit in order to claim the full amount of what is owed. Every state has federal laws that protect debtors from harassment, and Florida has gone a step farther to make those limitations to include the original creditors which provides added protection to debtors.
Statute of Limitations
As with other states Florida has governing laws on time limits for collecting debt. These governing laws are known as statutes of limitations. The Florida credit card debt laws statute of limitations on debt collection is five years. After the five year period the Florida credit card debt laws state that collectors may not instigate legal action against debtors for payments. These debts that have passed the five year mark are called time-barred debts. If a debtor is taken to court on a time-barred debt, the judge could toss the case out if the defendant informs the presiding judge that the debt is time-barred.
According to the Florida Credit Card Debt laws, collectors are not allowed threaten debtors. It is important to know that these laws do not protect from the re-aging of debts. Re-aging of debts refers to collectors starting the statute of limitations from the beginning because a debtor attempted to pay or acknowledged their debt. This practice is allowed under the Florida credit card debt laws and debtors need to be aware of the possibility of restarting the clock.
Even though there are credit card debt laws, there are instances where court rulings have taken precedence over statute of limitation laws. In some of these cases that means the time line on debts has either been placed at earlier than or later than that laid out by the Florida credit card debt laws. If this happens it is very possible and should be expected that the statute laws will be overridden and the ruling of the court will stand.
Garnishment and Homestead Laws
The Florida credit card debt laws give a safeguard for the debtors’ home and income. This allows Florida residents to have more negotiation options when dealing with creditors. Without protection debtors may end up having to make arrangements to pay back their debt, including having their employers taking wages from their paychecks and setting them aside for creditors. Other steps could include the seizure of personal accounts. The Florida credit card debt laws provide protection from the main income earner in the home providing that the individual has applied for the exemption, or unless the garnishment of wages has been authorized. In the same token homeowners are protected under the Florida credit card debt laws. Debtors must file a homestead exemption to protect seizure or forced sale of assets. This offers protection from court enforced refinancing or selling property with a loan against it. To be sure that they qualify for exemptions debtors would be well served to consult legal advice.
Florida Law Bans Surcharges
One particular protection the Florida credit card debt laws offer is banning creditors from charging debtors surcharges.
The credit cards that the Florida laws of credit card debt cover are any cards that hold a balance that is due on demand from the creditor. Debit cards and prepaid cards are not included under the law.
Exceptions for Student Tuition Fees
The one exception to the banning of surcharges is convenience fees that some colleges institute with tuition, student fees and other charges. However this fee cannot be more than the charge that the credit card company sends the college.
Discounts for Cash Payments Allowed
There is allowance under Florida Law for sellers and lessors to give discounts in the form of cash, check or other ways, if that offer will encourage consumers to pay using something other than credit cards. This offer must be open to everyone or it is not legal.