How to deal with Collection Agencies, Stop the
annoying calls and Get deletions
(Page 2 of 2)
annoying calls and Get deletions
(Page 2 of 2)
| Copyright RebuildCreditScores 2010 All Rights Reserved |
Links
The debt may be Uncollectible
Check your State's statute of limitations as the debt may be uncollectible. Your State’s
statute of limitations governs the amount of time a creditor or collection agency can sue you
for a debt. After the statute of limitations has run, the original creditor or the collection
agency cannot sue you for the debt. The debt becomes uncollectible. Be careful with old
debt as an expired statute of limitations in some states can be restarted by making a
payment on an old debt or even acknowledging you owe the debt. This does not mean a
creditor or collector is prohibited from attempting to collect the debt. It just means you
cannot be sued or taken to court after the statute of limitations has passed.
If you do decide to settle an old debt proceed with caution and try to settle the debt with the
original creditor in exchange for the debt reported "paid as agreed". Having the debt
reported as "settled" can hurt your credit score. If settling the account with the collection
agency aim for a full deletion of the account in exchange for payment. In all of your
negotiations, never acknowledge that the debt is yours. See your State's Statute of
Limitations
Watch out for Zombie Debt
Zombie debt may include past debts that you owe, discharged debt, debt included in
bankruptcy, debt you may have never owed and even debts incurred due to identity theft.
Zombie debt involves collection agencies purchasing debts for pennies on the dollar that
original creditors have long since written off as bad debt.
Deletions
If you pay a collection or settle a debt make sure you obtain a “deletion” and not a “paid
collection” entry. This also applies to paying a debt directly to the creditor. Your creditors
have the power to delete entries they put on your credit file. Never let them tell you they
don't. Just like they put it on, they can take it off. Some collection agencies even charge a
“deletion fee” but it is well worth the cost. A paid collection and an unpaid collection hold the
same negative weight.
Your credit score will not improve once you pay a collection, especially if that collection is
recent. When you negotiate a deletion ALWAYS get it in writing BEFORE you pay the debt.
This is your proof and once you have a deletion letter you may submit a request for the item
to be removed from your credit report directly to the credit bureaus by faxing or mailing that
letter. See Deletions and Sample Letter.
Request debt validation
According to the FDCPA you have the right to request a collection agency validate the debt
they are trying to collect. Essentially, the collection agency must show that you owe the
"original creditor" the debt, not the "collection agency" attempting to collect the debt. How to
you know the debt is yours.
Even if it is your debt do you really owe the collection agency who purchased the bad debt?
Debt validation forces debt collectors to prove you owe them. Many collection agencies
purchase bad debts without having access to the original contract between you and the
original creditor. If they cannot provide proof such as the original contract they cannot
legally make you pay the debt.
The collection agency will have to delete any negative mark they may have entered on your
credit reports immediately and cease any further collection efforts. If they continue reporting
the debt they are in violation of the FCRA, and you can sue for $1,000 in damages for any
violation of the Act. Learn more about debt validation and how it can save you from a
collection agency.
Check your State's statute of limitations as the debt may be uncollectible. Your State’s
statute of limitations governs the amount of time a creditor or collection agency can sue you
for a debt. After the statute of limitations has run, the original creditor or the collection
agency cannot sue you for the debt. The debt becomes uncollectible. Be careful with old
debt as an expired statute of limitations in some states can be restarted by making a
payment on an old debt or even acknowledging you owe the debt. This does not mean a
creditor or collector is prohibited from attempting to collect the debt. It just means you
cannot be sued or taken to court after the statute of limitations has passed.
If you do decide to settle an old debt proceed with caution and try to settle the debt with the
original creditor in exchange for the debt reported "paid as agreed". Having the debt
reported as "settled" can hurt your credit score. If settling the account with the collection
agency aim for a full deletion of the account in exchange for payment. In all of your
negotiations, never acknowledge that the debt is yours. See your State's Statute of
Limitations
Watch out for Zombie Debt
Zombie debt may include past debts that you owe, discharged debt, debt included in
bankruptcy, debt you may have never owed and even debts incurred due to identity theft.
Zombie debt involves collection agencies purchasing debts for pennies on the dollar that
original creditors have long since written off as bad debt.
Deletions
If you pay a collection or settle a debt make sure you obtain a “deletion” and not a “paid
collection” entry. This also applies to paying a debt directly to the creditor. Your creditors
have the power to delete entries they put on your credit file. Never let them tell you they
don't. Just like they put it on, they can take it off. Some collection agencies even charge a
“deletion fee” but it is well worth the cost. A paid collection and an unpaid collection hold the
same negative weight.
Your credit score will not improve once you pay a collection, especially if that collection is
recent. When you negotiate a deletion ALWAYS get it in writing BEFORE you pay the debt.
This is your proof and once you have a deletion letter you may submit a request for the item
to be removed from your credit report directly to the credit bureaus by faxing or mailing that
letter. See Deletions and Sample Letter.
Request debt validation
According to the FDCPA you have the right to request a collection agency validate the debt
they are trying to collect. Essentially, the collection agency must show that you owe the
"original creditor" the debt, not the "collection agency" attempting to collect the debt. How to
you know the debt is yours.
Even if it is your debt do you really owe the collection agency who purchased the bad debt?
Debt validation forces debt collectors to prove you owe them. Many collection agencies
purchase bad debts without having access to the original contract between you and the
original creditor. If they cannot provide proof such as the original contract they cannot
legally make you pay the debt.
The collection agency will have to delete any negative mark they may have entered on your
credit reports immediately and cease any further collection efforts. If they continue reporting
the debt they are in violation of the FCRA, and you can sue for $1,000 in damages for any
violation of the Act. Learn more about debt validation and how it can save you from a
collection agency.
- FDCPA Section 809. Validation of debts [15 USC 1692g]
(b) If the consumer notifies the debt collector in writing within the thirty-day period
described in subsection (a) that the debt, or any portion thereof, is disputed, or that
the consumer requests the name and address of the original creditor, the debt
collector shall cease collection of the debt, or any disputed portion thereof, until the
debt collector obtains verification of the debt or any copy of a judgment, or the name
and address of the original creditor, and a copy of such verification or judgment, or
name and address of the original creditor, is mailed to the consumer by the debt
collector.
1 2 Back
Debt Validation
How to halt the collection process by
requesting a collection agency to validate
your debt
Get Deletions
Request deletions when paying a negative
account. Paid collections do not improve
your credit scores.
Disputes
Learn how to dispute information in your
credit report and raise your credit scores.
How to halt the collection process by
requesting a collection agency to validate
your debt
Get Deletions
Request deletions when paying a negative
account. Paid collections do not improve
your credit scores.
Disputes
Learn how to dispute information in your
credit report and raise your credit scores.
More Resources
Review the amount owed
Most often when a debt reaches a collection agency the original creditor has already written
the amount owed off as a “bad debt”. The collection agency purchases that debt for pennies
on the dollar. Additionally, they tack on fees, costs and interests supposedly associated with
collecting the debt.
The FDCPA prohibits a debt collector from charging any fees or charges which are not
specifically permitted by the laws of your state, or contained in the terms of your original
agreement with the creditor. These debts can be settled for pennies on the dollar, especially
if the collection is older.
Most often when a debt reaches a collection agency the original creditor has already written
the amount owed off as a “bad debt”. The collection agency purchases that debt for pennies
on the dollar. Additionally, they tack on fees, costs and interests supposedly associated with
collecting the debt.
The FDCPA prohibits a debt collector from charging any fees or charges which are not
specifically permitted by the laws of your state, or contained in the terms of your original
agreement with the creditor. These debts can be settled for pennies on the dollar, especially
if the collection is older.
Related Topics:
 |
 |
 |
 |
|
 |
|
 |
|
 |
|
 |
|
 |
 |
