Michigan Laws Sections 339.901 to 339.920 are very similar to the federal Fair Debt Collection Practices Act (FDCPA). Highlights include:
- Debt collectors cannot threaten you with violence or use abusive or foul language
- Collectors cannot reveal your debt to anyone except you and your attorney
- If you retain an attorney, collectors must contact you through your lawyer
- Collectors cannot misrepresent themselves as being something other than a collector/creditor
- Collectors cannot publish or post your name
- Any correspondence must be in an envelope that only has the creditor’s name and address--no postcard correspondence can be used
- You can only be contacted by a collector between 8am and 9pm (unless you’ve agreed to another time)
- You have up to 30 days to dispute a debt--once the written dispute is set in motion the collector cannot contact you until it provides you with documentation
Consumers in Michigan can sue debt collection agencies, however a successful suit may result in damages of only up to $50. However, if the debt collection agency knowingly broke the law, Michigan consumers can receive up to three times the award, which includes court costs and attorney fees.
Michigan Statue of Limitations (SOL)
Michigan has a six-year statue of limitation (SOL) on open accounts such as credit cards, meaning that the creditor can contact you for up to six years. For written contracts creditors can also pursue you for up to six years. Consumers can consider Michigan debt settlement during the time the account remains open.
Michigan debt relief means that the law protects certain areas of wage garnishment. Areas that are exempt include:
- Social Security is protected under federal law
- Pensions and retirement benefits--Michigan has more protection for retirees than in other states. Additionally, exemptions include state employee, public school employees, police and firefighter pensions
- Public benefits/assistance-- protection for workers’ compensation, unemployment, veteran benefits, aid to families with dependent children and disability
- Michigan offers protection of annuities and insurance policies such as fraternal society benefits, life insurance or annuity processed or any policy with a clause protecting it from wage garnishment
Michigan Credit Card Debt Relief Act of 2010
The Credit Card Debt Relief Act of 2010 has streamlined the methods for repaying debt and regulated how collectors work with debtors. The Act has impacted debt relief collections several ways:
- The number of fraudulent or weak performing credit card companies are gone
- Reduces the chances of falling victim to fraudulent debt settlement companies due to new Federal Trade Commission (FTC) reforms
- Increased, open communication from creditors--more information is provided to help you eliminate your loans
- Debt settlement companies cannot request upfront fees from clients