Unfortunately debt collection does not stop when you die, In age where many American’s are overcome by debt. Debt has become a problem both before and after death.
The Great recession has caused many debt difficulties in the USA. The Wall Street Crash of 2008 has forced many into foreclosure and debt default. Mamuch debt has gone to horrendous, heartless third party collectors
The Federal Trade Commission is seeking to revise the protocol surrounding two of life’s touchiest subjects: debt and death.
Debt collection has become an increasingly controversial practice as more Americans default on loan payments. Government data show the charge-off rate on consumer loans spiked to 6.71 percent during the second quarter – the highest level in at least 25 years. (Five years ago, the charge-off rate – loans written off by their lenders as uncollectable – was 2.4 percent.) Meanwhile, debt collection ranked second on the FTC’s list of most common consumer complaints last year after not even cracking the top 20 two years ago.
The rise in debt collection has spawned a niche market devoted to recouping money from those who die with unpaid bills. The FTC began investigating the practice several months ago and found confusion among collectors over whom they were allowed to contact and what they could say, said Joel Winston, the agency’s associate director of financial practices.
“The debt doesn’t disappear when the person dies,” he said. “It’s still a valid debt, and the collector can still collect it.”
But the question is: From whom?
Death is a burden on families, but collection on the deceased’s debt causes more of a burden.
- You: FTC proposes new guidelines for collecting debt from dead people (washingtonpost.com)
- Feds propose new rules on debt collection from the deceased (walletpop.com)
- FTC May Allow Debt Collectors To Target Families of Deceased (smarterotti.com)
- FTC Takes On Debt Collectors (online.wsj.com)