Oak Park Real Estate & Estate Planning Blog

When you owe a substantial amount of debt to one or more lenders, you may not always know if you are being treated fairly by debt collectors . Under the Fair Debt Collection Practices Act (FDCPA), consumers are protected from certain kinds of communication with debt collectors, and the law also prohibits debt collectors from engaging in conduct that is abusive or harassing. In addition, the FDCPA prohibits debt collector from making false, deceptive, or misleading representations to consumers when attempting to collect on debts. However, debt collectors do not always abide by the terms set out in the FDCPA. According to a recent article in The Wall Street Journal , several states—including Illinois—have begun cracking down on debt collectors who have violated the FDCPA. Abusive Debt Collection Practices Result in Agency Closures The message of the crackdown on debt collectors is one that emphasizes government regulators will not put up with abusive debt collec...

The U.S. Supreme Court recently ruled in favor of Bank of America when it unanimously decided that “homeowners who declare bankruptcy can’t void a second mortgage, even if the home isn’t worth what they owe on the first mortgage,” according to an article in the Chicago Tribune . In short, it is a big win for the banks. Underwater Primary Mortgages and Personal Bankruptcy How did the case come about? It involved homeowners in Florida who were underwater on their first mortgages and wanted to use consumer bankruptcy to “strip off” a second mortgage. In general, the homeowners argued that, since their second mortgages would only be paid after their primary mortgages—and those primary mortgages could be canceled in a Chapter 7 bankruptcy proceeding—the second mortgages are “essentially worthless,” according to a report in the Wall Street Journal . The lower courts that heard the cases found in favor of the homeowners, indicating that they could “nullify the second loans”...