​The Federal and North Carolina Fair Debt Collection Violations Statutes are very similar. In fact the NC version was modeled after the Federal version. This article will concentrate on the NC statute as suing under the NC law often prevents companies from removing your lawsuit to Federal Court, where many believe they will receive favorable treatment. Damages in NC are determined by statute and vary between $500.00 and $4,000.00 per violation in addition to actual damages and attorney fees. Some of the most common violations that occur include:

​When debt is forgiven, the creditor usually writes that off their taxes creating taxable income for the borrower. That is the dirty little secret of debt settlement. The great news of settling credit card debt at 30 cents on the dollar can result in a rather large 1099 tax bill. Until recently the Mortgage Debt Relief Act of 2007 has prevented foreclosed homeowners from being hit with a huge tax bill. That tax break expired as of January 1, 2014.

​The best defense is usually a good offense. Everyone should run a credit report at least once a year to make sure they are not a victim of identity theft, fraudulent reporting by debt collectors, or negligence of the credit reporting agencies. If the first time you find out about a mistake on your credit report is upon denial for that house or car loan it may be too late. Fixing errors on your credit report to update your credit score can often prove to be a nightmare. In 2013, a federal jury in Oregon awarded a woman 18.4 million in punitive damages due to incorrect information on her credit report after repeated attempts to fix the problem. 

If you are considering whether to cosign for anybody- Don’t do it! Chances are if you are reading this article you are already regretting that fateful decision to help out a friend or family member. If you are being sued then your credit has already taken a hit and you don’t know what to do. So what are your rights and responsibilities and what recourse do you have against the person who is supposed to be making the payments?