Tuesday, November 30, 2010

You Might Want to Check Your Friends' Credit Reports

Posted By on Tue, Nov 30, 2010 at 11:13 AM

Let's say something terrible happens, and one of your close friends passes away. According to some experts on the debt-collection industry referenced in The Washington Post, you might be getting a few unpleasant phone calls:

The Federal Trade Commission is seeking to revise the protocol surrounding two of life's touchiest subjects: debt and death.

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 federal Fair Debt Collection Practices Act limits the people that collectors can contact to those with authority to pay the debt - typically a spouse or family member, and possibly a third-party executor of an estate. But in a proposed policy statement, the FTC said changes to court procedures have widened the pool of those who may be able to pay to include a host of other legal representatives.

Locating those who can pay the debt creates another challenge. Often, collectors may contact several friends or relatives in their attempt to find the right person. Current law allows collectors to only ask for "location information" without revealing that a debt is owed. The FTC is considering relaxing that rule for those who are deceased.

The FTC proposal states that collectors appealing to consumers' "moral obligation" to close the debt could violate federal law. In addition, it emphasized that collectors cannot imply that those with authority to pay the debt must do so out of their own pockets. All debts should be paid out of the deceased's estate.

To be clear, someone might call you to track down your dead friend's money, and they might imply you should help cover some of those debts, but you're not actually legally responsible to do so.

Still, you never can be too sure. I think I might running credit checks on people I meet from now on.

Comments

Subscribe to this thread:

Add a comment

More by Dan Gibson

Today | Thu | Fri | Sat | Sun | Mon | Tue
PiYo Strength Class

PiYo Strength Class @ Floor Polish

Thursdays, 4:30-5:30 p.m.

All of today's events | Staff Picks

Staff Pick

Summer Safari Nights

Summer Safari Friday Nights 2018 Date: Every Friday until August 3, 2018 6:00 pm — 8:00 pm… More

@ Reid Park Zoo Fri., May 18, 6-8 p.m., Fri., May 25, 6-8 p.m., Fri., June 1, 6-8 p.m., Fri., June 8, 6-8 p.m., Fri., June 15, 6-8 p.m., Fri., June 22, 6-8 p.m., Fri., June 29, 6-8 p.m., Fri., July 6, 6-8 p.m., Fri., July 13, 6-8 p.m., Fri., July 20, 6-8 p.m., Fri., July 27, 6-8 p.m. and Fri., Aug. 3, 6-8 p.m. 3400 E Zoo Court

» More Picks

Submit an Event Listing

Popular Content

  1. Four Great Things to Do in Tucson Today: Wednesday, June 20 (The Range: The Tucson Weekly's Daily Dispatch)
  2. New Ballot Initiative Promises Cheaper Electricity Bills and Cleaner Air (The Range: The Tucson Weekly's Daily Dispatch)
  3. Claytoon of the Day: The Chump Foundation (The Range: The Tucson Weekly's Daily Dispatch)
  4. Sally Hemings, 1773-2018: Hemingses' Lives Matter (The Range: The Tucson Weekly's Daily Dispatch)
  5. Exo Roast Co. Ditches Plastic for Paper (The Range: The Tucson Weekly's Daily Dispatch)

© 2018 Tucson Weekly | 7225 Mona Lisa Rd. Ste. 125, Tucson AZ 85741 | (520) 797-4384 | Powered by Foundation