Consumer Law Issues After a Disaster

I’ve legal information about consumer
law issues which may arise after a disaster I am Claire Johnson-Raba a
consumer rights attorney with Bay Area Legal Aid this training will help you
understand how you can assist consumers with some basic consumer law issues if
you encounter complex issues or a consumer has an upcoming court deadline.
Please refer the consumer to an attorney or a legal aid office for assistance
today we’re going to discuss avoiding disaster relief scams addressing
identity theft and the basics of credit reporting the effect on a borrower when
a vehicle secured by an automobile loan is destroyed or damaged in a disaster
and we will also discuss what to do if a consumer is concerned about missing
payments and the consequences of delinquent debt additional information
on many of the issues addressed today can be found on the FTC CFPB and
California Attorney General’s website. The economic impact of a disaster may be
far reaching a consumer who misses a few weeks of worth may be unable to keep up
with bills delinquent accounts may be may result in collection activity which
is stressful and consumers facing housing instability may experience
heightened concern about derogatory entries on a credit report miss payments
on a car loan may lead to repossession and student loans may fall into default
this training is intended to help avoid or mitigate some of these consequences
consumers may feel overwhelmed after a disaster so it’s important to make a
list of financial obligations and to prioritize payments family necessities
such as food should always take priority with housing and transportation payments
a close second unsecured creditors should be a lower priority and consumers
may be able to negotiate with creditors for a temporary reduced payment consumer
share avoid high-cost loans such as payday loans and other installment loans
with high interest rates in California there is no interest rate cap on loans
above $2,500 to these loans precent frequently add
on the internet and the radio are exceptionally expensive and should be
avoided price gouging is the intentional increase in prices after a disaster in
California price gouging is illegal for 30 days after the declaration of a
disaster and extends for 180 days for cleanup and building supplies price
gouging is raising the price of consumer goods and services by more than 10
percent after an emergency has been declared
California’s price gouging statute has an enumerated list of goods and services
which are covered in Penal Code section 396 including but not limited to hotels
motels rental housing building materials water and gasoline price gouging carries
both criminal and civil penalties if consumers are experiencing price gouging
they should report the price gouging by filing a complaint with the attorney
general’s office or talking to a private attorney as there is a private right of
action to enforce this statute consumers can avoid disaster relief scams by being
vigilant and looking for red flags demands for upfront payment are always a
cause for concern and consumers should know where to check the license number
an insurance policy of contractors the website URL and 1-800 number here are
where they can check the contractor’s license number in addition to checking
the license they should also ask for proof of insurance and actually call the
insurance company to confirm that the contractor has insurance coverage contractors or companies which demand
payment in cash should be avoided and door-to-door solicitation may be another
red flag and an indication that a company is not legitimate consumers can
find the complaint form and tips for hiring a contractor on the California
Attorney General’s website when consumers are in crisis and have lost
jobs or housing they may be more vulnerable to
rental or job scams consumers should be counseled to not pay upfront for rental
housing before they’ve seen the property or signed the contract and they should
never give out a bank account number to someone they find online offering work
or a place to stay consumers can report disaster related scams to the National
Center for disaster fraud by phone by FAQ or by email identity theft is always
a concern but consumers should be particularly cautious after a disaster
if the consumers former mailing address is uninhabitable the consumer should
open a Pio box and forward all mail consumers should carefully review all
monthly credit cards and bank account statements for unusual charges a
consumer who suspects ID theft should pile file a police report
online or in person in the jurisdiction where he or she suspects the theft
occurred disaster survivors may also call FEMA’s office of the chief security
officer to report identity theft related to a disaster consumers may obtain their
credit reports for free from consumers should
avoid for-profit websites advertising free credit reports and consumers should
never provide a credit or debit card number for a credit report as they may
be inadvertently signing up for a monthly fee consumers who have who do
not have a permanent address may provide the address of a homeless shelter or
disaster shelter in order to verify their address furthermore a list of
employment and tenant screening reports is available at the URL at the bottom of
the screen consumers are also entitled to a copy free copy every year of their
tenant or background screening reports from many of the companies on this list
if a consumer suspects identity theft the consumer may place a 90 day fraud
alert by calling any one of the three major consumer reporting agency
more robust anti-fraud process is the credit freeze which locks a credit
profile if it is in place across all three consumer reporting agencies
however a consumer who may soon be applying for housing employment or
credit they want to forego or wait on the credit freeze unless there is
document and evidence of ongoing identity theft a credit freeze at this
time may be burdensome to lift and there may be a delay in qualifying for new
credit or rental housing when an automobile is lost in a natural disaster
a consumer must consult her insurance policy to see the extent of the
insurance coverage a liability only policy will not cover this loss from a
natural disaster which is called an act of God but many comprehensive policies
may however unless a consumer has purchased a gap insurance policy the
vehicle will only be covered up to fair market value
this may leads a consumer on the hook for the deficiency the difference
between the loan balance and the value of the car a consumer should contact her
insurance agent or review her policy does she see if she has gap coverage if
a vehicle is damaged or totaled after a natural disaster as mentioned previously
if a consumer is very short on resources unsecured debt should definitely be a
lower priority however if payments are missed a creditor will report the
account of delinquent on a credit report an automobile deficiency will also be
reported as delinquent debt in California a creditor may sue for four
years from the date of the last payment to collect on defaulted consumer debt
the creditor may also assign or salva debt and the Athenee or purchaser will
be limited by the same statute of limitations however subsequent payments
whether they’re made to the creditor the Athenee or a purchaser of debt
we’ll reset the four-year statute of limitations and allow the owner of the
debt or the S&E to set to sue on that debt consuming may have some options if
they’re unable to make payments on their accounts if a consumer has a good credit
score they may qualify for a balance transfer credit card and they made
balance trance they may transfer the balances on their accounts to a new
lower and press card consumers may also request a temporary reduction in
payments but such a reduction is up to the creditor and the consumer has no
right to a reduced payment or reduced interest rate consumers who have to
temporarily reduce the payment to meet the minimum payment on their credit
cards should remember to reset the payment amount once they are stable
because minimum payments on a credit card frequently do not pay for the
accruing interest which leads to a much larger balance over time and a credit
card that does not get paid off consumers should avoid making payments
from one credit card to another consumers may be concerned after a
disaster about missing student loan payments borrowers with federal loans
may be able to place their loans on a hardship or unemployment forbearance
borrowers who are already on an income-driven plan may request an
adjustment of their monthly payment if their income is reduced private student
loans are simply unsecured debt so borrowers should confirm if their loans
or federal or private the national student loan database has a list of
federal student loans so a borrower may go on to nslds
e d gov to determine of her loans or federal or private the borrower may also
call her servicer to request that information if a borrower is currently
on a graduated or standard repayment plan and needs to switch to an income
based or income contingent a payment plan the servicer can assist
with that again private student loans operate like any other consumer debt and
any forbearance is discretionary the income driven payment options do not
apply to private loans in conclusion consumers affected by disaster should
remember to access all available federal and state benefits to which they are
entitled in order to avoid spending down cash and savings consumers should track
disaster related spending and recovery costs consumers who feel overwhelmed by
debt should be encouraged to visit a local nonprofit credit counseling
service online and storefront for-profit debt settlement and credit repair
companies are generally predatory and consumers should be discouraged from
paying into these services thank you very much
I can be reached at si Johnson at Bailey gorg if you have questions on this

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