When you have a Sequestration Court Order, you must never forget that all debt incurred before the date on your court order is included in the Sequestration. And you should understand how to handle debt collection after sequestration.
Please be cautious of debt collectors attempting to collect on debt before your Sequestration. These collection attempts date back as far as 2015 and, in my instance, 2011.
The collection agents seem to have become increasingly resourceful with their collection strategies. Some agents also become confrontational.
Strategies by collection agents
The collecting agents employ different strategies to convince you to pay.
Here are a few that I am aware of:
- Presenting a new loan
A loan company called me to offer a loan.
Here is a summary of the conversation:
Collection lady – this is not a loan but a consolidation loan for another loan that you owe.
Me – I don’t have any debt to consolidate.
Collection lady – you have a previous loan from 2011.
Me – But the Prescription Act covers that.
Collection lady – The Prescription Act is not accepted.
Me – I applied for Sequestration in 2013, and the loan debt will be included.
Collection lady – The Sequestration is not accepted.
If I accept that new “loan” and make just one payment, all the benefits of Sequestration will be lost, and I will be required to pay the original debt and years’ worth of interest and fees.
- Threatening emails and text messages
A collection agent will send a text message stating that you need to appear in court on a specific day
There is no actual court date, but the collection agent calls a few days later and uses intimidation tactics to get you to pay the debt.
- Signed Acknowledgment of Debt (AOD)
An Acknowledgment of Debt (AOD) document for the High Court is provided by a collection agent, who also includes absurdly high payment amounts on the document.
The court receives this document, which then becomes a court order.
- Emails with old debt or statements.
We have clients that were sequestrated in 2015 and 2016, and they are receiving emails for debt from before the Sequestration Court Order date.
- We don’t accept Sequestration.
Because agents confuse Sequestration with Debt Counseling, the collection agent will claim that they do not accept Sequestration.
You should always reply to these debt collection emails and calls with a copy of your Sequestration Court Order and refuse to be pressured into making a payment.
Stay out of a lengthy conversation if the collection agent rejects your response.
Insist on using email for communication. Then you have an audit trail for your Trustee.
Conclusion
The Prescription Act applies to your debt if your Sequestration is over three years old or if you haven’t made a payment on your debt in three years.
Collectors are permitted to pursue a pre-existing and prescribed debt.
It is up to you, the consumer, to claim pre-existing conditions or Sequestration as a defense.
I hope this blog provides some direction when the debt collectors call.
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This blog is for information purposes only and does not constitute legal or financial advice.
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