Posted June 21, 20148:56 am
From The Plain Dealer and reporter Sheryl Harris: click here for the full story online.
If you couldn't make last week's live chat on debt collection, here's a recap.
This is a mash-up of answers provided by our experts: Phil Althouse and Katherine Hollingsworth of Cleveland Legal Aid, Mike Wiseman of NHS Cleveland's Consumer Law Center, Bill Mann of the Ohio Receivables Management Association, and Larissa Bungo of the Federal Trade Commission.
To see a more detailed version, visit my blog, cleveland.com/consumeraffairs, where you'll also find information on debtor rights and resources.
We'll print more of your questions in Wednesday's Plain Dealing column.
TIME-BARRED DEBTS
Q. How long can a debt collector continue to pursue a debt? I have heard after six years they cannot contact you any longer. My mom just received a medical bill from a collection agency dated July 22, 2008. It did not provide any details, just the $1,500 due and the collection agency's name.
A. In Ohio, credit card debt is time-barred after six years, and medical debt is time-barred after eight years. Once a debt is time-barred, the collector can't sue or threaten to sue to get the money. It can, however, continue to ask for payment.
Important: Making a payment on a time-barred debt or promising in writing to pay on a time-barred debt can sometimes "revive" a debt and reset the clock.
If you didn't get enough help to determine if your mom owes the debt, use the sample letter provided by the Consumer Financial Protection Bureau to ask for more details.
RETIRED, UNABLE TO PAY
Q. We have three credit cards that have gone to collections. We fell behind on them when my husband retired and only gets a pension of $930 a month. We own our home, but have no other assets. I am disabled, but do not get monthly disability, just a yearly income tax credit. What are our options? The creditors are calling daily, and the interest is still going up.
A. If your husband is taking a pension and you are disabled, even if a credit card company sues you, it can't take money from your accounts or your monthly checks. Because of your limited income, bankruptcy isn't an ideal option. You might contact a credit counseling agency for help with arranging affordable payments. But if you can't pay the debt, concentrate on paying your living expenses. You may want to send a letter telling collectors to stop contacting you. You can find a sample letter at the Consumer Financial Protection Bureau's website, http://www.consumerfinance.gov/blog/debtcollection/
HELP WITH MEDICAL DEBTS
Q. My disabled son has hospital bills he can't pay. Debt collectors are suggesting that because he owns a home, he should pay the debt, but he has four kids and only makes $1,000 a month. What can he do? Aren't there programs that write off hospital bills as charitable expenses?
A. Hospitals do have charitable programs to help reduce or erase medical bills for qualifying low-income patients. Check with the hospital's financial ombudsman for information about those programs. (Reach the Cleveland Clinic's financial ombudsman at 216-445-6411 or ccf.org/financialassistance. Reach University Hospitals' financial advocate at 216-844-7502
or http://myuhcare.uhhospitals.org/ Click on "hospital billing" tab under the online bill pay tab and you'll see the charity care link.)
If your son calls 2-1-1, he can get information about benefits or nonprofit program help that could ease some of the financial burden your son and his family are facing.
Your son's income may be too low for a collector to be able to garnish his wages. In any case, it's not a good idea to take out a loan against a home to pay debts.
COURT ORDERS AND BILLS
Q. I have a court-ordered child support agreement in which my daughter's father is obligated to cover medical expenses. But when I took her to the doctor, they billed me for the balance since I completed the intake documents. He hasn't paid the bill, and it's affecting my credit since the doctor's office billed me. What can I do?
A. When you signed the intake papers at the doctor's office, there was probably a statement that said that you would be responsible for the bill. Take the bill the father is not paying to your attorney (if you have one) or the court or hearing officer who said he has to pay the bills. In the meantime, let the doctor know what's happening to avoid having the bill taken to collections. You may have to make a few small payments on the bill until you get your ex to pay.