They Need Legal Advice on Debts. Should It Have to Come From Lawyers?

“What we have isn’t legal rights under the law,” he said. “What we have is legal rights if you can afford a lawyer.”

The office of New York’s attorney general, Letitia James, did not immediately respond Tuesday morning to a request for comment on the suit and to a question about whether the help Upsolve wants to offer would violate rules on the unlicensed practice of law. The New York State Bar Association, which represents lawyers, said it would not comment on pending litigation.

In America, consumers are served with suits alleging failure to make payments of all kinds, whether for phone bills or fish tanks. The most common subjects of debt collection suits include medical bills, credit card balances and auto loans.

Americans do not legitimately owe most of the debt they are sued for, according to consumer advocates. A 2010 report by the Legal Aid Society found that in more than one-third of debt-collection cases reviewed, the debt had already been paid or had resulted from mistaken identity or identity theft; the statute of limitations on collecting the debt had expired; or the debt had been shed in bankruptcy. ACA International, a trade group for debt collectors, did not immediately respond on Tuesday to a request for comment on the Legal Aid Society’s report.

Marshal Coleman, a veteran consumer lawyer in Manhattan, said that most consumer debt suits were over matters of a few thousand dollars. “Typically, if a client like that comes to a lawyer,” he said, “a lawyer’s not going to be able to help them because the fees will exceed the value of the services.”

There are legal aid organizations that offer free representation to low-income people, but they tend to focus their very limited resources on other matters, like domestic-violence protection orders, evictions and foreclosures. Legal Services NYC, the city’s biggest provider of free civil legal services, has 450 lawyers on staff. Only one concentrates on consumer debt suits.

Article source: https://www.nytimes.com/2022/01/25/nyregion/consumer-debt-legal-advice.html