Summary: Residents of the Magnolia State are afforded legal rights under two federal laws related to debt collection, namely the Fair Debt Collection Practices Act and Fair Credit Reporting Act. These laws provide assistance and protections when being subjected to harassment and abuse by an overly aggressive debt collector.
When Mississippi residents are being subjected to harassment, intimidation and even threats by unethical and aggressive debt collectors, there are two federal laws providing statutory protections and rights to those residents: the Fair Debt Collection Practices Act and the Fair Credit Reporting Act.
Mississippians who feel they’re being subjected to such improper and unfair behavior by a debt collector can take advantage of these federal laws to pursue relief.
Debt collection laws in Mississippi are designed to protect the rights of both creditors and debtors involved in the collection process. Understanding these laws is crucial for both parties to ensure a fair and lawful debt collection process.
Mississippi Consumer Protection Act (MCPA): The MCPA is a state law that provides additional protection to debtors in Mississippi. It prohibits unfair, misleading, and deceptive practices by debt collectors. It also allows debtors to seek damages and attorney's fees if they have been subjected to these prohibited practices.
Statute of Limitations: Each state has a statute of limitations that establishes a time limit for creditors and debt collectors to file a lawsuit to collect a debt. In Mississippi, the statute of limitations for most types of debt is three years. Once the statute of limitations has expired, creditors cannot file a lawsuit to collect the debt. It is important for debtors to be aware of the statute of limitations applicable to their debt to avoid being sued after the time limit has passed.
Garnishment Laws: Garnishment is a legal process by which a creditor can collect a debt by obtaining a court order to seize a portion of the debtor's wages or bank account. In Mississippi, the maximum amount that can be garnished from an individual's wages is 25% of disposable earnings, or the amount by which disposable earnings exceed 30 times the federal minimum wage, whichever is less. The state also protects certain types of income from garnishment, such as social security benefits, workers' compensation, and unemployment benefits.
Debt Collection Licensing: In Mississippi, debt collectors are required to be licensed and bonded. They must obtain a license from the Mississippi Department of Banking and Consumer Finance and renew it annually. This licensing requirement helps ensure that debt collectors are operating in compliance with state laws and regulations.
Respond to a debt collection lawsuit in Mississippi
Being served with a debt collection lawsuit in Mississippi can be anxiety-inducing, especially when you are not well-versed in debt collection law and have no idea of where to begin. You are not alone in feeling this way and, unfortunately, many debt collection agencies try to capitalize on this feeling of overwhelm and anticipate individuals not responding to the legal action.
Ignoring a debt collection lawsuit does not mean that the debt collection agency will stop trying to recover the amount you supposedly owe. Instead, it gives the debt collection agency a good reason to convince a court of law to enter a default judgment against you.
A default judgment confirms that you owe the amount stated in the lawsuit and empowers the debt collection agency to use every legal means possible to recover the debt, including garnishing your wages and seizing your assets. To avoid a default judgment, you must respond to the debt lawsuit before the Mississippi deadline, which is 30 days.
This is why it is so important to respond to the debt collection lawsuit and consider raising affirmative defenses, such as the expiration of the statute of limitations.
Using the Statute of Limitations as an Affirmative Defense
The statute of limitations on debt in Mississippi varies depending on the type of debt. Generally, the statute of limitations on debt in Mississippi is three years, but that can change depending on specific circumstances. Here are some examples:
The statute of limitations for debt created due to a deficiency claim is generally one year following the sale of initial collateral items;
The statute of limitations of construction liens is one year from the date of filing;
The statute of limitations for contracts and promissory notes is typically three years; and
The statute of limitations for open accounts is up to three years from the initial due date stated in the given account.
The table below further outlines the Mississippi statute of limitations on different types of debt:
The Fair Debt Collection Practices Act protects you from harassment
One of the most important debt collection laws in Mississippi, and elsewhere across the country, is the Fair Debt Collection Practices Act (FDCPA). The FDCPA applies to all states, including Mississippi, and sets rules and regulations that debt collectors must adhere to when attempting to collect a debt. Under the FDCPA, debt collectors are prohibited from using abusive, deceptive, or unfair practices. They are required to provide accurate and truthful information about the debt, respect the debtor's privacy, and cease communication upon request.
The Fair Credit Reporting Act protects you from dishonest credit reporting
Along with the FDCPA, the Fair Credit Reporting Act (FCRA) is another federal law providing statutory protections to consumers in the context of debt collection. For example, the FCRA features the "Furnisher Rule.” This rule governs how debt collectors report certain debt-related information to large credit reporting agencies.
Pursuant to the FCRA’s Furnisher Rule, debt collection agents and agencies are also obligated to notify credit reporting agencies when the reported information is the subject of an active dispute and when an account is changing status from delinquent to closed.
Mississippi debt collection laws were created to keep consumers safe from abuse and harassment. These laws even the playing field and make it easier for consumers to defend themselves in and out of court. Here are some key takeaways on this article on Mississippi debt collection laws:
Federal Laws for Protection: Mississippi residents are protected against aggressive debt collectors by two federal laws: the Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Reporting Act (FCRA).
State-Specific Protections: Mississippi has its own Consumer Protection Act (MCPA) that prohibits unfair practices by debt collectors. The state also requires debt collectors to be licensed and bonded.
Statute of Limitations: In Mississippi, the general statute of limitations for debts is three years. However, specific types of debts, like deficiency claims or construction liens, have different timelines.
Garnishment Laws: Creditors can legally seize a portion of a debtor's wages or bank accounts in Mississippi, but the amount is capped, and some incomes are protected.
Responding to Lawsuits: Ignoring a debt collection lawsuit can lead to a default judgment, empowering the agency to recover the debt. It's crucial to respond within 30 days and consider defenses like the expiration of the statute of limitations.
Before considering a debt repayment plan or bankruptcy, you should understand your rights under Mississippi debt collection laws, consult legal counsel or SoloSuit resources, and be wary of unintentionally resetting the statute of limitations through acknowledgment or partial payments.
Settle your debt in Mississippi
Debt collectors and creditors have the right to take legal action if you refuse to communicate with them about your debt. However, that doesn’t mean that all debt lawsuits have merit. Luckily, SoloSuit was created with this in mind.
SoloSuit can help you respond to a debt lawsuit in Mississippi, stand up for your rights, and buy yourself time to work out a debt settlement plan. The surest way to get debt collectors off your back is by paying what you owe. And if you go about this wisely, you can usually settle your debt for less than you originally owed.
In a debt settlement, you offer your creditor a portion of the total amount due, usually at least 60% of the debt’s value. In exchange for a lump-sum payment, the creditor agrees to drop its legal claims against you and release you from the remaining balance.
To learn more about how to settle a debt in Mississippi, check out this video:
SoloSettle, powered by SoloSuit, is a tech-based approach to debt settlement. Our software helps you send and receive settlement offers until you reach an agreement with the collector. Once an agreement is reached, we’ll help you manage the settlement documentation and transfer your payment to the creditor or debt collector, helping you keep your financial information private and secure.
You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt.
SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.
Some creditors, banks, and lenders have an internal collections department. If they come after you for a debt, Solosuit can still help you respond and resolve the debt. Here’s a list of guides on how to resolve debt with different creditors.
Don’t have time to go to your local courthouse to check the status of your case? We’ve created a guide on how to check the status of your case in every state, complete with online search tools and court directories.
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Debt settlement is one of the most effective ways to resolve a debt and save money. We’ve created a guide on how to settle your debt in all 50 states. Find out how to settle in your state with a simple click and explore other debt settlement resources below.
Not sure how to negotiate a debt settlement with a debt collector? We are creating guides to help you know how to start the settlement conversation and increase your chances of coming to an agreement with every debt collector.
If the thought of going to court stresses you out, you’re not alone. Many Americans who are sued for credit card debt utilize a Motion to Compel Arbitration to push their case out of court and into arbitration.
Below are some resources on how to use an arbitration clause to your advantage and win a debt lawsuit.
Do you keep getting calls from an unknown number, only to realize that it’s a debt collector on the other line? If you’ve been called by any of the following numbers, chances are you have collectors coming after you, and we’ll tell you how to stop them.
And 50% of our customers' cases have been dismissed in the past.
"Finding yourself on the wrong side of the law unexpectedly is kinda scary. I started researching on YouTube and found SoloSuit's channel. The videos were so helpful, easy to understand and encouraging. When I reached out to SoloSuit they were on it. Very professional, impeccably prompt. Thanks for the service!" - Heather