Wage garnishment, the most common type of garnishment, is the process of deducting money from an employee’s monetary compensation (including salary), sometimes as a result of a court order. Wage garnishments continue until the entire debt is paid or arrangements are made to pay off the debt.[2] Garnishments can be taken for any type of debt but common examples of debt that result in garnishments include:
▪ child support
▪ defaulted student loans
▪ taxes
▪ unpaid court fines
When served on an employer, garnishments are taken as part of the payroll process. When processing payroll, sometimes there is not enough money in the employee’s net pay to satisfy all of the garnishments. For example, in a case with federal tax, local tax, and credit card garnishments, the first garnishment taken would be the federal tax garnishments, then the local tax garnishments, and finally, garnishments for the credit card. Employers receive a notice telling them to withhold a certain amount of their employee’s wages for payment and cannot refuse to garnish wages. Employers must correctly calculate the amount to withhold, and must make the deductions until the garnishment expires.
Wage garnishment can negatively affect credit, reputation, and the ability to receive a loan or open a bank account.
At present four U.S. states — Pennsylvania, North Carolina, South Carolina and Texas — do not allow wage garnishment at all except for debts related to taxes, child support, federally guaranteed student loans, and court-ordered fines or restitution. The federal garnishment limit (with some exceptions like child support and student loans) on a weekly basis is the lower of (A) 25% of one’s disposable earnings (what’s left after mandatory tax deductions), or (B) the total amount by which one’s weekly wage exceeds 30 times the federal hourly minimum wage. Several other states observe maximum thresholds that are lower than the maximums provided by federal law. States may also prohibit garnishment altogether in certain circumstances. For example, in Florida the wages of a person who provides more than half the support for a child or other dependent are exempt from garnishment altogether (though this is subject to waiver). Loans and negotiations with creditors can also help debtors to avoid wage garnishment.
In Minnesota, there are five limits on wage garnishment. Creditors cannot garnish wages for social security benefits, retirement benefits, welfare payments, workers’ compensation benefits, or income associated with disability or unemployment insurance.
In many states when the person is an employee or appointee of a governmental unit the writ is called a Writ of Sequestration. These are processed by the courts in the same manner as garnishments and are subject to the same wage exemptions.
In the United States, firing an employee to avoid handling a levy may be a criminal offense. Federal law provides for a fine of up to $1,000 and imprisonment for up to one year on an employer who willfully fires an employee in connection with a garnishment of the employee’s earnings.
Accounts Retrievable Systems - Personal Debt Relief
Origins of Personal Debt Relief
Debt relief existed in a number of ancient societies:
▪ Debt forgiveness is mentioned in the Book of Leviticus, in which God councils Moses to forgive debts in certain cases every Jubilee year – at the end of Shmita, the last year of the seven year agricultural cycle or a 49-year cycle, depending on interpretation.
▪ This same theme was found in an ancient bilingual Hittite-Hurrian text entitled “The Song of Debt Release”.
▪ Debt forgiveness was also found in Ancient Athens, where in the 6th century BCE, the lawmaker Solon instituted a set of laws called seisachtheia,and which canceled all debts and retroactively canceled previous debts that had caused slavery and serfdom, freeing debt slaves and debt serfs.
▪ In addition, the Qur’an (the Muslim scripture) supports debt forgiveness unable to pay as an act of charity and remission of sins for the creditor. The injunction is as follows:
If the debtor is in difficulty, grant him time till it is easy for him to repay. But, if ye remit it by way of charity, that is best for you if ye only knew.
—Qur’an 2:280
Contemporary
Personal debt has become an increasingly large problem in many developed countries in recent years, due to credit bubbles. For instance, it is estimated that the average US household has $19,000 in non-mortgage debt. With such large debt loads, many individuals have difficulty making repayments on debts and are in need of help.
There are many companies who offer debt consolidation services. However, such services may not always be in the best interests of the person involved and may involve taking out a loan secured by a person’s home. Marketing materials are designed to persuade customers to take up the company’s offer rather than offering a personal best solution for reducing debt. Where debt has become a problem, it is often best to turn to an independent consumer’s association for advice before calling debt consolidation companies as consumer’s associations often have great experience with such problems and may be able to advise the most effective avenues for debt relief- for the price.
As long as some form of Chapter 7 bankruptcy debt relief exists within American law, the credit card companies must pay attention, and do as much as they can to help their clients repay debts through relatively traditional means (depending upon the service those clients have entered). Even leaving bankruptcy aside, it is in the best interest of credit card companies that their debtors at least feel some motivation to continue repaying their accounts and not simply disappear or view those ever growing balances as untouchable.
Accounts Retrievable Systems - Collection of Debts
If your collection agency doesn’t collect anything am I still charged a fee?
No collection, No Fee!
Are you bonded?
Yes, we hold a Surety Bond.
Do you report to the credit report agencies like Experian and Trans Union, and if yes, is there a fee?
Yes, we do report to credit bureaus for our large volume clients, and it is a free service.
What do I do if the debtor calls our office?
The debtor must be directed back to our office to resolve this matter. In many cases, the debtor has made a promise to pay an amount either in full or by means of a “part payment.” The call to you amounts to a plea for “leniency.” The debtor may also tell you a different story than he told our attorney because the attorney has, in all likelihood, obtained information beyond what the debtor claims as the reason for nonpayment. We always strive for the fastest possible recovery of your money and the fastest recovery will always be a result of a unified stance between our company and you.
What do I do if I receive a payment from the debtor?
Contact our office immediately and make us aware of the payment and if possible fax a copy of the check to us.
What happens if my product is returned to me due to your collection efforts?
Your debt collection expense will only be 50% of the preferred rate against the present value of the returned product.
We have some delinquent accounts that promise to pay us soon, but never follow through. When should I send these accounts to collection?
Ideally, any accounts that reach and surpass the 90 day point of delinquency, are good candidates for placement with our office. Customers at this point have had ample time to pay their account, address any dispute, and contact you with any questions.
What type of documentation do I need to forward to you to start the collection process?
Send us our completed placement form along with a comprehensive statement of account, and if available; invoice copies, are usually sufficient to start the process. If you have the customer’s credit application handy, this is very helpful as well. Of course, any “bad“ checks that are part of the debt are required as well.
Accounts Retrievable Systems - Our Collection Agency
Since 1986, ARS has delivered professional, highly effective results for clients on a worldwide basis. ARS is recognized as a leader in Judgment Collections, Commercial Collections, Consumer Recovery, and is a specialist in collection of Child Support and Spousal Maintenance. Our partnership approach, rapid collection and ability to preserve relationships form the cornerstone of our commitment to excellence.
With three decades of experience both domestically and internationally, ARS serves a broad spectrum of industries.
Accounts Retrievable Collection Agency clients benefit from an array of collection solutions designed to increase cash flow, reduce expenses, improve operational efficiency and maintain positive customer relations. We are proud of our ability to deliver professional, effective and timely results worldwide.
ARS strives to remain a leader in the industry. Accounts Retrievable Collection Agency is comprised of a strong, cohesive and committed team. Our consistent track record for successful outcomes stems from a forward-thinking corporate mix where personal and professional aspirations thrive and progressive ideas flourish. Our team is kept current on all laws and statutes, FDCPA and FCRA compliance through ongoing education, and by attending seminars and meetings throughout our affiliations with the Commercial Law League of America (CLLA), the American Collectors Association (ACA), and DBA International (DBA).
Our company’s commitment is to constantly reinvest in our employees, new technology, recovery resources, professional staff, legal solutions, and innovative systems and procedures.
Accounts Retrievable Collection Agency’s legal solution is centered around our network of experienced collection attorneys. Our Forwarding Department coordinates litigation services for all 50 states and beyond. By having successfully litigated tens of thousands of cases for creditors, our legal network has the litigation experience to help our clients achieve maximum results and minimize any potential exposures.
Accounts Retrievable Collection Agency utilizes a wide range of technological tools and resources to help each client achieve the best possible results. Our staff has access to the latest software programs with enhanced security and a state-of-the-art secured network with a full disaster recovery program.
Our focus is on the specific needs of each client’s portfolio, whether it is for one claim or for thousands and is built on systems and personnel already developed, tested, and proven on a day to day basis. ARS will never close an account until every collection option has been exhausted.
Our services are based on a contingency fee arrangement; therefore if our attempts to collect are not successful, you will not be charged!
Accounts Retrievable Systems - Enforcement Of Judgments
CCP Section 695.010(a) provides that all property owned by the debtor, subject to certain exceptions, is subject to enforcement of a judgment. Community property owned by a debtor’s spouse is included within the “all property owned by the debtor.”
Additional costs and interest may be added to the judgment. As money comes in from the debtor to the creditor, it is first applied to satisfy any additional costs and interest, and only then, the principal balance of the judgment. Interest accrues only on the original amount of the judgment unless judgments are periodically re-recorded, in which case interest compounds. Judgments continue to exist for 10 years from the date of the entry of the judgment. Judgments may be renewed for additional terms of 10 years.
Judgments are usually collected through the lien mechanism. The creditor will place a lien on the debtor’s real and personal property (by recording the judgment with the county recorder’s office or entering it with the Secretary of State), and the lien will be satisfied when the property is sold by the debtor or foreclosed upon by the creditor. Once the underlying judgment is satisfied, the lien must be released.
Accounts Retrievable Systems - Definition Of A Judgment
A judgment, in a legal context, is synonymous with the formal decision made by a court following a lawsuit. It is also known as a decree or order. When a judgment is won, the court may also make a range of court orders. This can include imposing a sentence upon a guilty defendant in a criminal matter or providing a remedy for the plaintiff in a civil matter.
In the United States, under the rules of civil procedure governing practice in federal courts and most state courts, the entry of judgment is the final order entered by the court in the case, leaving no further action to be taken by the court with respect to the issues contested by the parties to the lawsuit. With certain exceptions, only a final judgment is subject to appeal.
In some legal systems (particularly civil law jurisdictions), a judgment is not considered final until after appeals have been exhausted or waived.
Winning a judgment is only the start of the collections process. It is highly likely that a creditor will have to continue with legal proceedings after they have won the law suit. This is because debtors rarely will cut a check at the first court hearing. While this may seem like a complicated process, it is the best way to ensure that your debt is being repaid.
When You Can Obtain a Judgment:
When an individual does not respond to a complaint
An individual does not comply with a judge’s order
Accounts Retrievable Systems - Collection Practices
Debt collectors who work on commission may be highly motivated to convince debtors to pay the debt; These practices are highly regulated by The Fair Debt Collection Practices act, State laws to protect consumers, and the Consumer Financial Protection Bureau (CFPB), the Federal Trade Commission,and State regulatory agencies. Several Federal and State higher courts decisions have outlined several bad practices; Heintz vs. Jenkins,In re: Vinhee, Mcollough vs. Johnson, Rodenburg, Lauinger, Komarova v. Nation Credit Acceptance Inc.
In the US, the FDCPA prohibits calls to the debtor if the call will cost the debtor toll charges (in most other countries recipients of telephone calls are not charged, so this issue does not arise). The FDCPA also establishes what time of day calls can be made at, to whom and where. If a person answers, the call center may track statistics (e.g., the times and days when someone answers) in order to place calls at times when the debtor is more likely to be home; typically this is done by an automated dialing system between the times of 8am and 9pm local standard time. The collector may not use illegal and deceptive practices (for example, threatening the debtor with arrest or impersonating law enforcement). The collector cannot use obscene language and must inform the debtor of the nature of the call (collecting a debt) and their name and the name of the collection company when requested.
International debt collection is a less common and specialised field. Not many companies specialize in this sort of collection as there may be a need to speak different languages and have a knowledge of the different legal systems and laws. International collection calls are often made in a different language than used in the collecting company.
Collection agencies are sometimes allowed to contact individuals other than the debtor, usually in an attempt to locate the debtor but without mentioning the debt. In the US under the FDCPA a collector is permitted to call a neighbor or relative for help in locating the person who owes a debt. Collectors may only ask for “address, home phone number, and place of work.” Collectors are “not permitted to discuss [the] debt with anyone other than [the debtor], [their] spouse, or [their] attorney.” The debtor can give permission to the collection agency to speak to somebody else besides the above mentioned. Collectors must state their name and must give the name of their employer if the person specifically asks. They may only contact each person once, unless it is believed that the person gave the collector incorrect or incomplete information at the time, but now has complete or updated information. Collectors may contact a debtor at the workplace unless the collector has been informed the employer prohibits such calls, in which case the collector must cease all calls to the debtor’s workplace immediately.
At times a person with no connection to the debt or the debtor may be contacted by a collector by error. Examples include victims of identity theft and people erroneously targeted due to a similar name. Alternatively, the alleged debtor may dispute that the debt is payable. In such cases the alleged debtor can require that the collector or creditor prove that the debt is payable—in no jurisdiction does a debt exist merely because a collector says so. In the United States under the FDCPA, anyone has the right for any reason to request written validation of the debt or to demand the collector cease communication.
Relatives of deceased people do not necessarily themselves have to pay the debts of the deceased, but debts must be paid by the deceased person’s estate.
Accounts Retrievable Systems – Why Hire a Collection Agency?
The rate at which people are accumulating debt and the states of the economy at the moment is quite sad. Many people are under a mountain of debt that they cannot pay back. However, there is a problem when you are one of the companies to which debt is owed. As a result of this, some companies resort to hiring a debt collection agency to recover the debt that would like resolved. The rest of this article will deal with some tips on how to hire a debt collection agency.
A debt collection agency is used by businesses or individuals to regain any money borrowed pulse the interest owed. The debt collection agency can be a third party debt collector if the original company has sold the debt to them. In another circumstance, the debt collection agency can only be contracted to act on behalf of the company the debt is owed to. When looking for a debt collection agency, you will need to check a company this is professional, effective, and trustworthy. This company will be acting on your behalf and it is important that they can effectively represent you.
First, when looking on how to choose a debt collection agency, choose an agency that is professional. As stated, they will be speaking to a customer or a client that owes you money. If the agency is not professional, this can hurt your company and your company’s name. Some debt collection agencies had been known to be one step away from threatening people to receive the money owed. This is quite unprofessional behavior and this is not an agency your company would like to be associated with. So before hiring any agency, research the reputation that they have.
Look for the following signs that indicate that you may need to work with a collection agency:
A new customer does not respond to the first letter. For some unknown reason, the consumer will not or cannot pay. Potential losses could be kept to a minimum by prompt referral to a collection agency.
Payment terms fail. In some cases irresponsible consumers pay when and if they want to. This group is responsible for 25 to 50 percent of the cost of collections. Cost and potential losses are reduced by quick action.
The consumer makes repetitious, unfounded complaints. Such consumers are often better handled by a collection agency. You have to decide if this is worth your time or would you rather pay an agency a small percentage for that time and still get paid.
The consumer totally denies responsibility. Without professional help, these accounts are usually written off as total losses. This is when it is good to have a signed credit application or contract and also, if possible, proof of the order and who placed it.
Delinquency coexists with serious marital difficulties. These also require professional collection help, with the added urgency of obtaining payments before the disappearance of one or both of the responsible parties. If divorced people say the other is responsible, get a copy of the divorce decree, which will state who is responsible.
Repeated delinquencies occur along with frequent changes of address or jobs. This group is responsible for 90 percent of all “skips.” A skip is a consumer who has moved without informing creditors or leaving a forwarding address. The chance of finding a consumer and collecting a debt will decrease over time, so quick action is important. Most agencies provide a skip-tracing service.
Obvious financial irresponsibility is apparent. In such cases, little hope exists for voluntary payments and a quick settlement.
There is an unauthorized transfer or disposal of goods delivered in a conditional sales contract.
Working With a Collection Agency
Once you decide on a collection agency, use their forms to list accounts or their format to upload accounts electronically. Give as much information as possible-accurate information about the account will improve collections.
In all cases, the minimum information should include:
The correct name, address and telephone number of the debtor
Name of the debtor’s spouse, if applicable
Whether mail has been returned
Debtor’s and/or spouse’s occupation or last known occupation and phone number
Names of relatives, friends, neighbors and references
Summary of any disputes
Date of last transaction, order or payment
Cellular phone, fax, e-mail address
Nicknames or aliases, maiden name
If you have had all new customers fill out a credit application, all of the above information should be listed on there. The summary of disputes would be in the computer notes for the customer’s account. This makes it very easy–all the information you need, basically all in one place, on one piece of paper. This is one of the reasons why a credit application is so important. Cooperate with your collection agency. Rely on their experience, diligence, and judgment for the best and quickest results and promptly refer any contact from the debtor to the collection agency. Make sure that your collection agency is familiar with the nature of your goods or services–some agencies even specialize in collecting on specific services. For example, you might find an agency that only collects on delinquent auto loans, or medical bills, or hot tub sales. If you find an agency that specializes in your field, check them out; there is a reason they only do those types of collections. Don’t place any accounts with more than one agency. Make sure that if you change collection agencies, the accounts are only being worked on by one agency. Collection agencies’ fees are based on results, not on time spent on the account. Don’t expect payments to be made immediately.
Accounts Retrievable Systems - Acquire Peace Of Mind
Accumulating debt can be an extremely disturbing experience for all businesses. The procedure of making contact with individuals and companies that have unpaid can take precious time away from additional significant company issues and the concentration needed for managing a company. In such a case, engaging a debt collection agency is an ideal solution to having the entire affair handled by a source, outside your company.
One of the main benefits in appointing a debt collection agency is that you are taking the right to put your confidence on a company that specializes in making certain that you obtain the money payable to you. The people who work in these organizations are familiarized in making calls to all sorts of customers.
One more benefit is that you pay for outcomes. Debt collection agencies depend on the success of getting your customers to shell out what they are obligated to pay you, so as to obtain their individual earnings.
As a business holder, probabilities are you won’t be familiar with, all of the different measures that you can lawfully utilize to gather arrears. Collection agencies are familiar with the rules and regulations and are able to raise debt collection activities to legal acts, whenever required.
Every nation has their own particular laws regarding collection agencies and if you have an international debt and do not know where to turn to, you must try to find a debt collection agency with international practice.
Contrasting domestic accounts, when you do business worldwide you wish to monitor all your prospective clients.
It is a lot harder to collect debt internationally and you always wish to make certain that you are dealing with a reliable client. An international debt collection agency can be of great assistance to you, regarding this matter, by running background verifications and asset investigations. This way you will be acquainted with what you are getting into before you bankrupt yourself
All in all, Collection agencies enclose the essential expertise, tools and resources to recuperate debt promptly, in a competent and customer-friendly way. Tranquility and gaining money you have been assured are chief rewards of employing a debt collection agency.
Accounts Retrievable Systems - How Collection Agencies Work
Unfortunately, not all businesses succeed and sometimes businesses that are unsuccessful or operate without the best intentions will not pay their business debts. When a company has a business customer that has not paid their debts, they have to take action to collect the debt owed to them. One resource many companies use to collect business debts is to hire a commercial collections agency. Commercial collections agencies take on the difficult task of collecting business debts so that their client can continue to focus on the daily operation of their business without the hassle of trying to get the debtor to pay their debt.
When a commercial collection agency is contracted by a business to collect business debts, they will begin by contacting and negotiating with the debtor through phone calls, mail, email, and other contact methods. They know how to apply the appropriate amount of pressure using pressure techniques such as the debtor’s reputation and credit rating to get them to pay their debt. These agencies are fully informed about the legal methods that are permitted to collect business debts. In most cases, the debtor will pay when reminded of their responsibilities. Commercial collection agencies charge a fee for their services.
Commercial collection agencies put a lot of work that takes a great deal of time, research, and negotiation with the debtor. Their experience and knowledge gives them an advantage when pursuing a debtor because they know how to conduct themselves in a way that motivates the debtor to pay the debt.
They will only become aggressive when they determine the debtor will definitely not pay. They will eventually take legal action if required.
The goal of a commercial collection agency is to apply just enough pressure to get the debtor to pay the debt, and not to provoke the debtor. They are professional, but employ firm persistence in a mild mannered way. At all times they will show great patience when dealing with difficult debtors. They never employ any illegal tactics or unethical conduct to get someone to pay. Instead, they will move to court if it gets to the point that the debtor is just not going to pay. When you hire a CCAA certified member commercial collection agency, you will be assured that the debt collection agency is professional and adheres to a strict code of ethics which assures the use of professional collection procedures. They will not use abusive or harassing techniques to collect the debt. You will receive timely reports, collection verification, and fast release of the collected debt.
If you are currently not receiving payment of a customer’s business debt and your attempts at recovery the debt have been unsuccessful, it is to your benefit to turn your file over to a commercial collection agency as you will greatly increase the chance of getting full debt recovery. When you hire a commercial collection agency, you can return to running your daily business while the agency takes on the burden of collecting the debt owed to you.
