Anda di halaman 1dari 5

Proper Responses

Lots of folks out there are asking lots of questions on how to respond to different correspondences they receive from various agencies. I would like to cover some of the most frequently asked questions, and go over correct responses. #1 Responding to the Banks Letters and calls asking for payment. If you are engaging the creditor in administrative process, the most common mistake folks are making is asking for a Validation or Debt or a verification of Debt pursuant to the Fair Debt Collection Practice Act. I have been given permission from one of our students to use the following excerpts from a letter. Dear Mr. Blank, Your correspondence dated June 14, 2002 has been forwarded to my office for answer. In your said correspondence, you have asked for Citibank to provide a verification of alleged debt by affidavit. Please note Citibank is not under any obligation to respond to such request as the Fair Debt Collection Practices Act does not apply Original Creditors. I assure you that Citibank has complied with the terms of the Credit Card Agreement, and as such, is legally entitled to payment. If you chose to ignore this obligation, Citibank will exercise its rights to pursue lawful remedy to recover this debt. Sincerely Mr. J. Davis - Corporate Counsel Ok, how many people out there have tried asking the bank to make a verification or validation of debt? Did it work? Did you get any benefit of future evidence in case they take you to court? Probably not. Funny, I once heard that if they can get you asking the wrong questions they dont have to worry about answers. You can see why most folks are getting ran over or ignored, and or referring the debt to Attorneys. If you are going to send correspondence to a bank, by all means at least ask the right questions. What you would actually want the bank to respond to is a request for assurance of due performance. And please let me explain why. Under Uniform Commercial Code Section 2-609 (Section 1) we find, and I quote A contract [for sale] imposes an obligation on each party that the others expectation of receiving due performance will not be impaired. When reasonable grounds for insecurity arise with respect to the performance of either party, the other may in writing demand adequate assurance of due performance and until he receives such assurance may if commercially reasonable, suspend any performance for which he has not already received the agreed return. (Section 3) Acceptance of any improper delivery or payment does not prejudice the aggrieved partys right to demand adequate assurance of due performance.

(Section 4) After receipt of a justified demand, failure to provide within a reasonable time not exceeding 30 days such assurance of due performance as is adequate under the circumstances of the particular case is a repudiation of the contract. UCC 3-603(b): If tender of payment of an obligation to pay an instrument is made to a person entitled to enforce the instrument and the tender is refused, there is discharge, to the extent of the amount of the tender, of the obligation of an endorser or accommodation party having a right or recourse with respect to the obligation to which the tender relates. Taken from State Code : When a debtor is entitled to the performance of a condition precedent to, or concurrent with, performance on his part, he may make his offer to depend upon the due performance of such condition. A correctly written letter to a Bank will meet each of the above two elements, and is going to give you evidence in court that you offered to pay the debt, if they would just provide what you are legally entitled to. In court you could also, tell the judge, that there is no controversy for him to hear, that you conditionally accept their offer to pay, if they would just give you the legally required assurance of due performance. Using Tom Shauffs materials there are seven elements that you want the bank to answer #1 Did the bank loan their money as adequate consideration to purchase the borrowers agreement? #2 Did the bank accept something of value from the borrower, that funded the loan? #3 Did the bank record the agreement as both an asset and a liability? #4 Does the Bank Follow Generally Accepted Accounting Principles and the Federal Reserve Policies and Procedures? #5 Is it the intent of the contract that the one who funds the loan is to be repaid? #6 Was Full Disclosure given to the borrow as to who was to fund the loan? #7 Is it the Banks intent to deny equal protection to the borrow? Now why are these elements important? #1 Did the bank loan their money to purchase the contract. Under the Uniform commercial code a contract without consideration is facially void. To help explain consideration, lets use this agreement. I approach Dan and say Dan will you paint my house. Dan says sure, what will you give me. And I say, well Dan, if you paint my house I wont beat the crap out of you. Dan says oh, um, Ill think about it. Now after two weeks and my house isnt painted, and I mysteriously havent seen Dan around, can I go to court and try to enforce the contract? No and the reason, is Dan is not under obligation, as there was no tender of consideration from me. Now if I paid Dan up front $500, I have tendered a consideration, and as such, if he does not perform, I can claim damage. Lets relate this to the bank. They accept an asset from you called a note. In order for them to own the note, they must substitute an equal asset for an equal asset. If they loan their money, Cash may go down, but Accounts receivables will go up, thus making all assets

equal, and not affecting liabilities at all. If they steal the note from us, they must record it as both an asset and a liability. #2 Did the bank accept something of value from the borrower, that funded the loan? We are asking did they take an asset from us, and use its value to purchase the note. If this is true, then again, it shows lack of consideration. #3 Did the bank record the note as both an asset and a liability? Again if we can get them to admit that they recorded the note as a liability, then we know they owe us the value of the note, as an unauthorized loan. #4 Does the Bank Follow GAAP & FRP&P. This is a tricky question. If they answer Yes, then we know what the bookkeeping entries are based on mandatory compliance with these two legal principles. If they answer No, now they are in trouble for breaking the law. Now Jesus found himself once in a situation such as this. He was asked if it was correct to pay tribute to Caesar. He knew if he said Yes, he would be condemned by Gods law, and if he said No, he would be in violation of Caesars edict. So he cleverly said give unto Caesar that which is Caesars which will be eternal damnation and destruction, and give unto the Lord that which is the Lords, which is your love, devotion, and obedience. I have heard a lot of preachers misstate the intent of that lesson, but I am digressing. #5 Is it the intent of the contract that the one who funds the loan is to be repaid Here is another trick question. They will have to say Yes, which actually is a statement against them. If you funded loan then they agree they should pay you. #6 Was Full Disclosure given to the borrow as to who was to fund the loan? In a contract there are consumer protection laws that require that all terms of the loan be disclosed in writing. If the agreement or contract is construed to be outside the written form, then it is null and void #7 Is it the Banks intent to deny equal protection to the borrow? They must say no, but in actuality there intent is to deny you equal protection. Basically they was to use the laws that can be construed against you, will remaining silent or perpetrate a fraudulent material concealment against you. If they are entitled to repayment, then why would you be denied repayment. Never ever refuse to make payment, always be willing to make payment as soon as you get Assurance of Due Performance. Phone Calls Be courteous, in control, and dont show emotion. It is their tactic to elicit an emotional response from you, as they get the most pain for the buck. If you get mad every time you hear a creditors name, or if you see their number on the caller I.D., then they have effectively created a painful association between them and your decision not to tender payment. This is a clever and effective mental game, and as long as you are aware of it, you can actually have some fun with it. First rule of phone calls, always ask for there name and employee identification number, a number where you can call them back at, and who their supervisor is. Please keep in mind that it is unlawful for them to use profane or vulgar language with you. If you can get them upset, and to holler at you, then

inform them that your spouse is on the other phone recording the conversation, and you find that there behavior is unlawful according to Federal Law. Call them back repeatedly asking them questions, concerning your loan. If they know that they are not getting under your skin, then the harassment has lost its effectiveness. If you dont have the stomach for this, then simply be polite and say, I dont conduct business over the phone, and hang up. Eventually the calls will stop, and most campaigns last 3-6 weeks. Responding to Collectors. Third parties are subject to the Fair Debt Collection Practices Act, and this include Judges and Attorneys. I have here a court case Heintz v. Jenkins, 514 US 291 FDCPA applies to lawyers and judges engaged in debt collection. Additionally a 1986 senate report 99-405 included attorneys as well as judges in the prohibitions. And at last, Matinez v. Law Offices of David J. Stearn 128 F.3e 500, 501 - Upon acting upon a validation notice by disputing the debt, a consumer is under no obligation to respond to the complaint. Be law the following statement must appear on the initial correspondence or within 5 days after the initial correspondence: This debt will be assumed valid by this office unless you the debtor consumer within 30 days after the receipt of this notice disputes, in writing, the validity of the debt or some portion thereof. If you notify this office within 30 days of the receipt of this notice that the debt, or any portion thereof, is disputed, we will obtain a verification of the debt and a copy of the verification will be mailed to you. If the debt is based on a judgment, a copy of the judgment will be provided upon request. If the creditor named is not the original creditor, and if you make written request to this office within 30 days from the receipt of this notice, the name of the original creditor will be mailed to you. Ok, a lot of you folks have requested validation, but what do you do when you get something from them that is not verification? Here is where a lot of folks make the mistakes. If you get something from them that look like copies of statements, or computer printouts, you must not keep them. If you keep them it is your tacit acceptance. Take a marker in large print and write across the face of the original documents Refused Without Dishonor Not a Verification. If you would like to make copies of the original before you send them back, by all means. This is the one and only case that you would ever part with an original copy of anything. If it has been longer than the time to respond, include the refused original with your letter of fault. Make sure you mention there nonresponsive correspondence in your fault letter. I have a student who has kept the attorney from filing a summons for 4 1/2 months by refusing their presentments, and asking for more information. You should see some of the crap they are sending my student. Its actually very entertaining. This should start to make sense to some of the UCC gurus and procedure veterans, regarding acceptance. I can hear light bulbs going on right now. Keep in mind that there is a court case that states that they can file a summons within the

initial 30 day period, but according to the act and case law, they cannot proceed without somehow getting you to agree with a presentment of verification. Some folks are experiencing judges who dont know that they cannot proceed. It is your duty to inform the Judge of how to behave in your case. Where do we get judges? The same place we get building inspectors. Ive heard it said that a building inspector is a builder who couldnt make it in the trade. Well, lets say the same about a Judge. You got the incompetent attorney, who all of a sudden has incredible powers. He doesnt really know much about law, and barely enough on how to do his job, and that is the reason why we submit petitions. The court is moved by court rules. The judges jurisdiction is created by a sufficiency of the pleadings. Keep in mind that you create a box for the Judge to operate within by showing him the correct case law and procedures he is supposed to make decisions by. If you do not place anything of evidentiary value in front of him, he cannot rule in your favor. Next, If you receive a summons, do not send a validation of debt to the Judge. The Judge or the court clerk is under absolutely no obligation to answer, nor do they have the authority to answer on behalf of the bank. If you would like to alert the judge that the debt is disputed, so he knows not to proceed, then do so in your answer brief. One of our listeners had a 1.5-minute pre-trial hearing. It went simply something like this: Ok what do we have hear, Ok Monogram Credit Card Bank versus Joe Goodguy from Michigan. My Goodguy, what is this, do you own bank some money? And Joe quickly states, well your honor, Im not sure, I have asked for a verification of this debt and to date have not obtained one. Judge looks at the Attorney and says, Counselor, you do intend to get this man his verification? Attorney stammers and says, um, well, um, your honor, Ill have to get back with you on that. The Judge say, fine, Im going to schedule this out for another 90 days. If you want to let the Judge know within your pleadings that you have created an estopple, by all means do so, and attach a copy of the request for verification, including the proof of service and green card to the debt collector. Estopple is a legal word for a bar or to prevent. The correct way to respond to a summons is to look at the 3 to 6 points that the attorney has listed in the complaint. You must rebut these claims, and within these rebuttals you must lay groundwork for your defense. If you fail to rebut or build a defense, the next thing you get from court is the attorneys motion for summary judgment. Some folks will make a special appearance on their initial filing, and that is fine, if you intend to challenge jurisdiction. That would be a subject for another call, and we will leave it as such.