Archive for the ‘Creditor’s Rights’ Category

» Understanding the Basics of Creditor’s Rights On Sunday, December 28th, 2008

In this day and age an ever increasing number of people are finding themselves experiencing problems relating to their finances and to their debt. However, lenders of different types are also experiencing problems in this day and age. Therefore, it is crucial for people to fully understand their rights as creditors. Through this article you are provided with an overview of some of the basics associated with creditors rights in this day and age.

First, when it comes to creditor’s rights and debt collection issues, a lender has the right to initiate legal action against a borrower when the borrower has failed to honor the terms and conditions of any loan agreement. Some borrowers and debtors try to claim that enforcing the terms of loan agreement is “unfair” or an undue burden on these individuals because of their other financial obligations, problems and issues. However, and again, provided the loan agreement is written in a manner consistent with applicable statutes and regulations, and provided that the borrower is in breach of that agreement, a creditor has an absolute right to pursue legal remedies as permitted by law.

Second, in regard to creditor’s rights, if there is collateral involved with a loan – for example, a loan for an auto or a home mortgage loan – a creditor has the right to obtain possession and ownership of that collateral provided the provisions of the law are followed. Once again, a creditor has the absolute right to pursue repossession or foreclosure.

Third, as a creditor, another right that accrues when there is collateral related to the underlying loan is the right in most states to obtain what is known as a deficiency judgment. In other words, if a creditor takes possession or ownership of collateral – for example, an auto or a piece of real estate – the creditor can sell these properties to pay off the loan balance. If the proceeds from the sale of these properties does not cover the amount outstanding on the loan, the creditor (in most jurisdictions) has the right to take further legal action in order to obtain a judgment for any additional money that is due and owing under the terms and conditions of the loan in question. Once a judgment is obtained a creditor can pursue collection of that judgment through such means as garnishment of bank accounts or paychecks as well as other means.

In many instances, a creditor is best served by seeking the services of a qualified attorney when it comes to dealing with obtaining compensation for a loan that has gone into default. Indeed, there are lawyers that specialize in the areas of collections, repossession and foreclosure. There are also attorneys that deal in bankruptcy defense actions as well. In other words, there are attorneys who specialize in assisting clients who have been named in bankruptcy cases by individuals who owes money to these clients. In the end, creditors typically are best served in protecting their interests through the engagement of attorneys who specifically are versed and experienced in defending and furthering the interests and the rights of these creditors.

Tags: , , , , , , Posted in Creditor's Rights | Comments Off on Understanding the Basics of Creditor’s Rights

© Legal News and Articles
All Rights Reserved.

Entries (RSS) and Comments (RSS).

Affordable Professional Website Design