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Missouri Collection Laws

What rights do creditors have under Missouri law to collect debts from consumers?

I need to learn how a collection agent can get a judgment from me. I live in Missouri.

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A collection agent or law firm that owns a collection account is a creditor. A creditor has several legal means of collecting a debt. But before the creditor can start, the creditor must go to court to receive a judgment. See the Bills.com resource Served Summons and Complaint to learn more about this process.

The court may decide to grant a judgment to the creditor. A judgment is a declaration by a court that the creditor has the legal right to demand a wage garnishment, a levy on the debtor's bank accounts, and a lien on the debtor's property. A creditor that is granted a judgment is called a "judgment-creditor." Which of these tools the creditor will use depends on the circumstances. We discuss each of these remedies below.

Receiving Calls from Debt Collectors?

Receiving collection calls is unpleasant, whether from the original creditor or from collection agency. Call 800-998-7497 to speak with a Money Coach and discuss what to say and not to say in a phone call with a debt collector, and also what kind of financial plan you need to avoid this happening again.

Missouri Wage Garnishment

The most common method used by judgment-creditors to enforce judgments is wage garnishment. A judgment-creditor contacts your employer and requires the employer to deduct a certain portion of your wages each pay period and send the money to the creditor.

Learn the Limits of a Wage Garnishment
In most states, creditors may garnish between 10% and 25% of your wages, with the percentage allowed determined by state law. Garnishment of Social Security benefits or pensions for consumer debt is not allowed under federal law, but may be allowed for child support. See the Bills.com Wage Garnishment article to learn more.
Know Your Rights - Stop Unscrupulous Debt Collectors
Collection agents violate the FDCPA if they file a debt collection lawsuit against a consumer after the statute of limitation expired (Kimber v. Federal Financial Corp. 668 F.Supp. 1480 (1987) and Basile v. Blatt, Hasenmiller, Liebsker & Moore LLC, 632 F. Supp. 2d 842, 845 (2009)). Unscrupulous collection agents sue in hopes the consumer will not know this rule.

Missouri Payday Loan

See the Bills.com resource Missouri Payday Loan to learn more about the rights consumers in Missouri have regarding payday loans, and options for resolving them.

Recommendation

Consult with an Missouri attorney experienced in civil litigation to get precise answers to your questions about liens, levies, and garnishment in Missouri.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com

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  • MG
    Oct, 2018
    Mark

    I have recently started a Debt Management Program through a consumer credit counseling agency. However, I have one creditor with whom I had fallen less than two months behind with them before the Program was set in place. They have accepted the terms of the Program, and are therefore receiving full, monthly payments from the agency as per the agreement. However, they are also threatening legal action if I do not eliminate the past due amount. My question is two-fold: 1) Can they initiate legal action while I am making regular, full payments; and 2) Isn't any amount paid to the finance company get applied to the oldest past due amount, thereby keeping me in a continual state of 45 days past due, rather than be applied to the current month, thereby allowing the past due amount to continue to grow in age?

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    • 35x35
      Oct, 2018
      Daniel

      I recommend starting by contacting the Consumer Credit Counseling Service you engaged and sharing the correspondence from the creditor that threatens legal action. I believe that the matter is an instance of miscommunication and will get straightened out easily. My guess is that the department that sent the letter to you wasn't aware that the account is now part of a Debt Management Program. 

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  • 35x35
    Jun, 2018

    I live in MO and I am being taken to court by a third party collection agency for a credit card debt that happened in 2011. I told the agency I couldn't pay anything. I have to go to court this week. I did some research and it stated that in MO a company couldn't collect on a debt older than 5 years, well we are on year number 7. I can't afford a lawyer and legal aid says I make too much money. I'm paying on 2 old credit card debts already plus other bills. Any advise?

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    • 35x35
      Jun, 2018
      Daniel

      I can't give legal advice, as only an attorney may properly do so. I will share a few thoughts with you, with the understanding that you don't consider it legal advice.

      The statute of limitations (SOL) on credit card debt in Missouri is five years. The clock starts running on the SOL at the date of default, giving the creditor or any collection agency that properly assumes the debt, five years to file suit. There are actions that can reset the clock, giving the creditor five years from that event, such as if you made a payment on the debt after the date of default.

      Acknowledging that the debt is yours, even if you say you can't pay can, in some states, reset the SOL clock or stop it from running. Most states, including Missouri, require a written acknowledgment, but in some states even a verbal acknowledgment can making an agreement to pay the debt. 

      There are also actions a debtor can take that stops the five-year clock from running. For example, if you defaulted on a debt and then went abroad, hoping to lay low until the SOL expired, the creditor could claim that your absence should make it so the SOL clock was on hold.

      With your stated inability to get professional legal advice, the best option remaining is to go to court and argue that the SOL on debt applies. If you don't show up and make that defense, no one else will. The judge is not going to, even if  SOL actually does apply.

      Lastly, in the unfortunate even that the SOL doesn't apply and a judgment is entered against you, familiarize yourself with the collection laws in Missouri. A judgment in Missouri can result in a wage garnishment of 25% of your income, after certain mandatory deductions are taken. Obviously, that big a hit can wreak havoc on your ability to pay your normal bills and to maintain the payments you are making to the other creditors. If a judgment is entered against you, speak with a bankruptcy attorney. You may make too much to qualify for a Chapter 7, but a Chapter 13 may result in a payment that is burdensome but less severe than the amount that can be garnished.

      0 Votes

  • DW
    Jan, 2015
    David
    Do I have any recourse if a settlement was made between my debt relief agency (FDR) and the lawyers retained by the debtor filing suit against me reached that settlement 8 days before my court date, was sent the check 3 days before my court date but I still received a judgement? Thank You!!
    0 Votes

    • 35x35
      Jan, 2015
      Daniel
      I can’t give you legal advice, as only a lawyer can properly do so. I will share my opinion with you, though. When the start of a settlement is so close to a court date, the law firm does not always have an opportunity to cancel a court date. Sometimes, they may even proceed with the court date for the sole purpose of obtaining judgment while the settlement in place. The language of a settlement will generally preclude a creditor from proceeding with judgment execution, but the judgment serves as recourse for the creditor in the event that a settlement fails. From the law firm’s perspective, this debt has been defaulted before; they would like some means of collecting if it happens again. Once the settlement completes, the law firm will file a satisfaction of judgment.
      0 Votes

  • JE
    Aug, 2013
    Jerry
    Seymour, MO
    In May 2012, I suffered extensive medical problems which left me permanently and totally disabled, as determined by Missouri Department of Social Service (Medicaid), and by Social Security Administration Office of Disability Adjudication and Review. I am expecting to get my first SSI payment in September 2013. I now have a credit card company that has filed a lawsuit for $3800 I owe. I believe they cannot take my SSI money, but can they take my only vehicle ($2500.00 value)? I have to have this vehicle to have someone take me for medical treatments and doctor visits. I have no money to hire an attorney. Is there anything I can do? Thanks for your site! Thank you!
    0 Votes

    • BA
      Aug, 2013
      Bill
      I am not a lawyer, so I can't give you legal advice, but I will share some information with you. Please do not take it as legal advice.

      Missouri has a vehicle exemption of $1,000. Technically, I believe that it is theoretically possible for a judgment-creditor to force a sale of an asset, with the exempt amount remaining with the judgment-debtor and the rest going to the creditor. However, I do not believe that this is likely. It is important that you go to court, if you are sued, to explain your situation to the judge. I would be quite surprised if a person living on SSI would be forced to sell a low-value vehicle.

      I recommend that you see if there is any free legal aid available. I did a quick search online for "legal aid Missouri," and see a number of organizations in various parts of Missouri. Find the one for the region in which you live and give them a call.
      0 Votes

  • PH
    May, 2013
    pamela
    Mexico, MO
    Let's say I have a wage garnishment in Missouri. If I move to North Carolina, can the judgment-creditor still garnish my wages? North Carolina supposedly doesn't allow wage garnishment on most judgments.
    0 Votes

    • BA
      May, 2013
      Bill
      North Carolina's wage garnishment law is a bit tricky. Generally, yes, North Carolina law does not allow wage garnishment. However, there's a big loophole in the law. Here's what Cherie Berrie, the Commissioner of Labor at the North Carolina Department of Labor wrote about this exception:
      While the North Carolina courts are not permitted to garnish wages based on these debts, creditors in other states may be able to get an order of garnishment under their own states' laws. It is not a violation of the North Carolina Wage and Hour Act for an employer to withhold an employee’s wages if required to do so by law. If a court from another state issues a valid order under that state's laws requiring an employer to withhold a North Carolina employee’s wages for payment of a debt, the employer does not violate the North Carolina Wage and Hour Act by obeying that order.
      Therefore, a judgment-creditor who received a judgment from a Missouri court will likely be able to enforce a wage garnishment order if you become a North Carolina resident.
      0 Votes

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