Professional Collections Services in Los Angeles

Lending institutions in the United States reported a 16 percent increase in their credit card chargeoff rates in the third quarter of 2011, according to data released last week by the Federal Reserve.

The Fed said that its member banks reported a seasonally adjusted, annualized credit card charge-off rate that averaged 5.81 percent in the third quarter, up from 5 percent in the second quarter. The average writedown rate was, however, drastically lower than the 8.71 percent rate reported in the year-ago period.

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The United States economy added 80,000 jobs in October, the Labor Department said Friday. The unemployment rate ticked down to 9 percent from 9.1 percent in September on the strength of larger-than-expected revisions to jobs growth in the preceding months.

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A Bel-Air man who declared bankruptcy, then hid his assets and threatened a process server with a golf club, was sentenced today to almost six years behind bars.

Milton Lee Vandevort, 50, was convicted in July 2010 of money laundering, concealing assets in a bankruptcy case, and making a false oath and a false declaration in a bankruptcy case.

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LEHIGH ACRES, Fla.—Joseph Reilly lost his vacation home here last year when he was out of work and stopped paying his mortgage. The bank took the house and sold it. Mr. Reilly thought that was the end of it.

In June, he learned otherwise. A phone call informed him of a court judgment against him for $192,576.71.

It turned out that at a foreclosure sale, his former house fetched less than a quarter of what Mr. Reilly owed on it. His bank sued him for the rest.

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Overall year-over-year activity decreased for 11th consecutive month, but default notices jumped 33 percent from July.

RealtyTrac, an online marketplace for foreclosure properties, released its U.S. Foreclosure Market Report for August 2011, which shows foreclosure filings—default notices, scheduled auctions and bank repossessions—were reported on 228,098 U.S. properties in August, a 7 percent increase from the previous month, but still down nearly 33 percent from August 2010. The report also shows one in every 570 U.S. housing units with a foreclosure filing during the month.

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Buried in President Obama’s deficit reduction plan unveiled Monday was a provision that would allow cell phone calls for the purpose of debt collection. But the brief proposal seemed to cover only debt owed to, or guaranteed by, the Federal Government.

On Page 28 of “The President’s Plan for Economic Growth and Deficit Reduction,” there is a very brief paragraph that states:

Allow agencies to contact delinquent debtors via their cellular phones. The Administration also proposes to amend the Communications Act of 1934 to facilitate collection of debts owed to or guaranteed by the Federal Government, by facilitating contact of delinquent debtors who are most readily reached on their cell phones. This provision is expected to provide substantial increases in collections, particularly as an increasing share of households no longer have landlines and rely instead on cell phones.

There were no additional details given, but a spokesman for the Office of Management and Budget did tell the Huffington Post, “This proposal merely reflects the fact that more and more people rely solely on a mobile phone for their voice communications, and allows debt collectors to call them on these numbers.”

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The scent of blood is in the water. As the sharks continue to circle, Bank of America (BofA) reportedly is considering taking drastic steps to protect itself from the tsunami of lawsuits continually flooding the company in the wake of the Countrywide Financial Corp. takeover.

A group of people with knowledge of BofA’s corporate strategy told Bloomberg in a story posted today that the beleaguered bank would consider having the business unit file for bankruptcy if litigation losses threaten to topple the parent company.

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The average net charge-off rate at five of the largest U.S. credit card issuers increased slightly in August, bucking a 12-month trend of declines. The average delinquency rate declined slightly.

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August consumer bankruptcies decreased 11 percent nationwide from August 2010, according to the American Bankruptcy Institute, relying on data from the National Bankruptcy Research Center. The data showed that the overall consumer filing total for August declined to 113,432, down from the 127,028 consumer filings recorded in August 2010. Each month of 2011 has recorded fewer bankruptcies than last year.

“Consumer bankruptcies continue to decline over the past year as households deleverage and consumer credit remains tight,” said ABI Executive Director Samuel J. Gerdano. “As a result, total consumer filings will be lower in 2011 than the 1.5 million consumer cases in 2010.”

The August 2011 filings also represented a less than a 1 percent decrease from the July 2011 consumer bankruptcy total of 113,470 filings. The percentage of chapter 13 filings for August was 30 percent, a one percent increase from July.

The national credit card delinquency rate (the rate of borrowers 90 or more days past due) decreased for the sixth consecutive quarter, dropping to 0.6 percent at the end of the second quarter in 2011, according to data released by TransUnion on Aug. 16, 2011. This is the lowest mark observed in 17 years. Credit card debt per borrower increased $20 in the quarter to $4,699, though it remains near record-low levels.

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