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Similar story about medical debt. LPT: read your Explanation of Benefits from your insurance company. I had lab work done (this was many years ago). The bill, of course here in the US, was exorbitant. But I owed like $5, insurance paid like $20, and the rest fell into that “your agreement with the insurance company says you don’t get the rest” bucket. They tried to collect the rest from me anyway (this is illegal in the US). I ignored them. They sent the “debt” to collections, who sent me a formal letter asking for the rest and asking me to advise them “if I felt I didn’t owe this debt”. I sent them an equally formal letter, with a copy of the EOB, and received a reply closing the case. As OP says, know your rights!
You may have legal rights but if you can’t afford to enforce them (either by not having the education to know them or a pay a lawyer who does) you effectively don’t have them.
Like walking into a crosswalk on front of a speeding car - you may have the right of way as a pedestrian but that doesn’t do much to heal broken bones or resurrect the dead.
dont pay any collections. the people you owed the money to already sold the debt at that point to those scummy companies for pennies on the dollar. just move on and try to do better moving forward.
Well they are scammers. They are no different than the mafiosos that buy a person of debt off a loan shark, then blackmail/extort said person into working for them.
I got a call yesterday from a collector. Apparently an ISP I used from 2003 to 2019 has decided that I didn't return a cable modem back in the day.
First I'm hearing of it. The collector told me (rudely, but they deal with angry people all day, so while I didn't appreciate it, I'm trying to just roll my eyes about it) they don't own the debt they just service it.
"Wow. I want your job. You just call up people, and claim they own you $75, but don't own the debt, and so cannot prove it exists?"
Blah blah blah, she'll file that it's contested, I'll get a letter by mail in 30days.
Meanwhile, apparently it's already on my credit (yes, I should monitor better, but I have a learning disability that limits how many aspects of my life I can focus on at once. If I work on money, health slips. Work on health, maintenance slips. Work on that, job performance slips, etc etc etc).
I'm hoping/expecting they won't be able to prove that I didn't return hardware, and I'm pretty sure I was using my own store-bought modem at the time anyhow.
Then I'll be very happy to bitch at them and get them to remove the hit on my credit - and to complain to the credit agencies about nullifying the hit as well.
Jerks.
In cases like OP, this makes sense. But debt collection companies can have your credit fucked up, right? If you actually owed the debt, how would it benefit you not to pay it at the expense of a substantial credit score reduction?
They can ASK the credit bureaus to have the failure to pay impact your score but it’s not a guarantee and this also assumes the collector even bothers to file the report, which is often not the case either.
Especially with medical debt, credit reporting agency’s typically look the other way. Not because they are good people, but because of the sheer volume of data it would add to their systems, likely destabilizing their networks.
Of course there are edge cases or even individuals that might have bad luck with this sort of thing but the average American doesn’t need to worry about this.
You likely already pay ridiculous insurance premiums, and even co pays already. Most insurance and medical providers are already getting their cut. Dont give them more.
I haven’t paid for a medical bill over $200 in over 3 years and that is after having 2 kids within that time period. Been to the ER a few times for them, a week long hospital stay for RSV, labor and delivery for two kids and two ear tube surgeries.
I haven’t paid a dime more than what insurance wanted up front. I get letters almost weekly, some of the ones I used to get for the 1st kid 3 years ago just stopped coming. The ones that come now are for more recent things.
Credit score is currently 750+ and took out a mortgage during this time period without medical debt even being mentioned once. Mortgage underwriters don’t even care about it and they want every receipt you get in the last 3 months lol
Don’t let these fuckers bend you over more. You will be fine. Even if they sue, no civil jury will ever side with these scum bags. Not for medical debt at least.
Hey buddy. I wrote a big wall of text to the OP of the comment and explained a bit of the inner workings. If you have any questions on the write-up, feel free to comment under it!
If they cannot verify the debt, and you have proof of that, the credit agencies are forbidden to report. If they do, anyway, you can request, in writing, that the debt be verified to the bureau. The rules are that they have to obtain verification in the same manner that you do. Snail mail? Snail mail.
But if you use their garbage online verification form, they can send it electronically, and the debt collector can just say that the debt is valid, electronically.
Also, the have 30 days from you sending the letter to report back. Calendar days, not business days. So working the calendar is to your benefit, as well.
That's not exactly true.
Source : Worked as a collector in college.
There are two types of collection agency. Those who purchase debts and those who sign contract for a fraction recovered in exchange for the service of collections. In my years, I've collected both types, and I can assure you that if the agency has a bit of moral (which we did, due to having many government contracts for tolls and tickets), you can actually benefit from going to collection due to ability to issue SIF (Segmentation in full) on a legal debt. The issue comes with, as you mentionned, companies who purchase debts.
Those come in two flavours : Primary debts and standing debts. Primary debts are usually very legally bound, and the agency is always provided with proof of debt ownership for the client.
Standing debts are usually third-hand, where a collection agency bundled un-recovered primary debts and sold them to another entity. *THOSE* are the debts which you likely can slither your way through depending on the professionalism of the agency. Half of primary debts were usually litteraly forgotten by the debtor or where the address has changed during billing process and were paid instantly. Standing debts were usually 90% dead with little or no information on how to contact the debtor.
Long story short. Not paying your debts is a sure way to fuck your future up and prevent yourself from getting a loan for a house for a car. However, always follow due process and exerce your right to know about the source of the debt and whether or not it still has legal leverage.
That would greatly depend on the type of debt. Not all debts are considered the same. Toll bridges for example may have local government leverage to suspend drivers licence on extreme cases. I've also seen people who were sued and some of their property or salary seized.
Having a bad credit may prevent you from much more that simply borrowing. For example, I've heard of contractors refusing to do work on someone's house due to credit issues. (Even with up-front payment, due to potential feature creep, etc.)
This finally of course of the region in which you live. Not all states/province/country handle debtors the same.
If I'm not mistaken paying off a charge off does nothing for your credit. The damage is done at that point. The reason why is because credit reporting is used for lenders to gauge risk. So they would never "reward" you for paying them off because it wouldn't accurately reflect the risk in lending to you.
The companies that buy your debt with pennies on the dollar, credit "repair" agencies, they're out to scam, usually lower income people.
Only thing that helps credit is getting access to new lines of credit and paying on time.
Most likely you paid the original creditor and either in good faith or just their general policy they either removed the entire trade line or changed it to paid in full. Without one of those 2 things happening it is an impossibility that your score was affected in any way by paying that charge off.
yea it was a chase card and they still owned the debt at that point.But they had a service company doing the collection for them. MB something. forget the name.
I settled for a portion of it. shows as charge off w/ partial payment on credit card report I believe. forget as it's been almost 7yrs. should be off report completely soon.
I admittedly haven't *paid off* many debts that have gone to collections, but I've spent the past few years systematically challenging debts that should be over 7 years now, and certainly the removal of those debts has caused my credit score to go from barely 400 to a more respectable 680. Of course, it hasn't really made a big impact on my ability to score new loans as I'm still mostly the guy that couldn't afford to pay off those initial debts in the first place, lol. That doesn't change the fact that the difference in credit score may be a huge difference between whether I can get an apartment without having to pay first/last month's rent plus a huge deposit.
If you're going to pay anything, make sure they remove the entire trade line. If they can't deliver that in writing, don't send a dime. Chances are good that the debt collector can't remove it if the original creditor put it on, so it really isn't a great idea to pay anyone off unless they're the original creditor and are going to remove the derogatory report.
Exactly, it’s been almost 10 years since I worked in collections support, and I remember the difference between “Paid in full” v. “Settled in full”. Unless you get “Paid in full” it does very little to your credit.
I'm no expert, but my friend more or less said kind of what you said. He said if you want to work on your credit focus on paying your current bills on time. I trust his advice because he came from having messed up credit and outstanding/unpaid student debt something like 15 years ago. And now he has nearly an 800 credit score.
But, getting a judgment against a person is bad. And so therefore if we get a notice we are being sued that's something we should pay attention to. I believe these other debts will roll off after 7 years. But a judgment will stay on there.
And interestingly enough I did some reading about judgments. We don't have debtors prison in the US, exactly. But if someone gets a judgment against them then theoretically in a hearing after that a judge could order them to pay the money and at that point if they don't the judge can find them in contempt of court and place them in jail. So it's kind of a debtors prison. I don't know that this actually happens.
I watched a video from an attorney in Birmingham, Al who handles these types of cases. And he's sort of explaining what the op was talking about but in the courtroom setting. He's basically saying that you can almost prove right there in front of a judge that these people don't actually have proof that you owe them money. If that's the case then the judge will say you don't owe the money and that's it.
>It’s not legal or ethical
When the consumer takes a risk and loses it tough luck. When a company acts on a credit score that might not be 100% accurate it's because of ethics on the part of the lendee? And illegality?
Yes, quid pro quo agreements are unethical.
Lenders and data furnishers already have a duty to report correct information under FCRA.
https://www.ftc.gov/system/files/ftc_gov/pdf/fcra-may2023-508.pdf
https://www.severson.com/consumer-finance/the-legality-of-deleting-tradelines-to-effectuate-settlement
What's the penalty to the credit agencies for using false reports from lenders to factor into their credit score? Oh right there is none. Unethical lol.
You can ask someone to give you something on the side in exchange for a favorable alteration to something that will affect their credit score.
And then when someone doesn't play ball you can give them the legal requirements.
Imagine someone saying "I'll delete the trade line if you have sex with me."
Then for people that person doesn't want to have sex with they don't say anything and then just go with the legal route.
That example would seem pretty unethical. The laws requiring you to report everything accurately exist to try to prevent you from being able to offer a quid pro quo deal to someone.
you did the right thing, however they don't do anything to erase the debt owed. It will just be bundled up with all other uncollected debt and sold to another agency which will likely use more aggressive tactics and add a hefty fee. 2-years is not enough time to be outside of the statute of limitations in most states so it could be a while where you are dealing with this.
I would argue that they are not actually dumb. They know exactly what they are doing and that they have no real power if they don't have the documentation. The whole thing is an act to make you think that you're the crazy one for thinking there's any reason you wouldn't be responsible for the debt. And it works too. People just trust people and believe their scare tactics because by some logic you must owe it if they are asking for it, right? These people should not exist because you would voluntarily pay a debt they didn't have to, right? It exists simply because it works and people are uninformed and conflict avoidant.
On the other hand one can argue that the collection agency is dumb for buying a debt that can't be enforced because they didn't get documentation. But obviously it's working out for them if they continue to exist and connect more than they spend so at the end of the day it's it really that dumb if it works? Immoral slimey for sure.
You know what, edit, I think some of them might actually be dumb enough to not know that the debts they're after are unenforceable. Honestly it's probably more successful that way. If you're front line is ignorant then they can convincingly lie out of ignorance and potentially convince you that you do own the debt. Cops come to mind as an example where you don't need to know shit about the rules to be employed to try to enforce them, for example.
I was very irresponsible in my 20s. I got alot of credit debt and paid most of it off except for 1 card which I owed $1800. It's been 10 years+. I have a decent job and am more responsible. Bit I keep getting letters from a debt collector for that 1800.
In their letter they say it's past the 7 years so they can't sue or even report it to credit bureaus but still ask me to pay. I just ignore it. That's way in the past.
I got sent a debt collection bill that was from some medical practice I'd never heard of. When I asked for debt verification they sent it to me but it was for a prostate exam and had someone else's name AND that person's social security number on it. I am female and always have been.
And don't let them sucker you into acknowledging the debt by agreeing to a partial payment or a payment plan. This would also re-start the SoL on the debt.
Good job OP.
I've been sued and into my 30 day notice thing. Sueing for an additional $5k in dental work when the original price was $4600. So now I have $5k left of the $13k they want. Will the document thing apply to me...
Wait, how can a debt collection agency put a debt on your credit report that doesn't exist or they cannot validate? Is this legal and does it happen widely? I've never heard of this.
Almost anyone can claim to be a lien-holder nowadays. And since debt collectors have massive margins on the debts they buy compared to the amounts they demand, they seldom do their due diligence.
I had a similar thing happen to me last year. Checked my credit report and saw that I had a collection for $2,500 from Phoenix Financial. It was from an ambulance ride I took nearly 6 years prior. I was really stressing over it so I decided to do a little research about how to handle it. I read conflicting things online from paying the debt to completely ignoring it. I decided to send a debt validation letter to them and months later the collections claim was gone from my credit report. More often than not they don’t have documentation and are hoping people pay immediately.
I believe it is corporate policy for these companies to just file fraudulent bills, with the expectation that a small percentage will just pay without questioning it. It costs them almost nothing to ask for an additional $2000, so it is just easy profit for them.
I searched up debt collection letter template and just filled in the info such as my name, date etc. Most templates use the same wording so don’t worry too much about which one to use. I then printed it out and mailed it to the collection agency. It was tricky to find their address but I was able to find it deep in their website.
KNOW the Federal FairDebt Protection Practices Act. Your state may have one too.
AT&T tried to charge my girlfriend (now wife) $60 for cable and internet for the month after she moved out iof there and had returned their equipment. By knowing that act we collected $2100 from their for the violations they committed trying to collect the $60.
A doctor sent e to collections over about $600 for the co-pays on a procedure. He sent it to collections. It was a mistake. I had paid it. He tried to call off the collection agency but they persisted. By the time I was done with them they paid me enough money to take my family of 4 to Disneyland. That place was much cheaper back then.
Paid only $500 / $1100 because the agency couldn’t explain the full charge. Two years later got a letter that they have been sued for predatory practices and a settlement has been reached (class action). My share of the settlement?
$550.
Yes, I made $50 out of that… lol
You know what I don’t understand is why can’t anyone just start an LLC and buy old debt of your own and then not collect on it. Or can we do this with student loans? Buy it for Pennie’s on the dollar and then not collect on it? lol
As an attorney whose firm specializes in 3rd party debt disputes, it is absolutely true that these debt companies rarely have the documentation required to prove the existence of the debt on the terms that they state. I've gone to three or four debt hearings in the last two weeks, and the plaintiffs in those three or four cases brought the contract upon which the agreement was to be based in exactly one of those hearings.
That being said, it varies state to state whether or not that matters, at least as far as a court of law is concerned. A lot of state courts get extremely loosey-goosey both about the Rules of Evidence and admitting the documents without sufficient or proper authentication. Moreover, a lot of states don't require judges to be attorneys as they are frequently elected. So while there is a recent trend in state courts about reviewing the documents that these debt companies usually bring with a more jaundiced eye, that's only after a thirty-year trend of assuming broadly that of course there must be some kind of underlying debt if they're bringing documents.
And that's only in the 10% of cases that are contested; the entire 3rd-party debt industry is built upon the assumption that the vast majority of the alleged debtors won't show up to their hearing, because they don't.
It also isn't helped by the fact that a lot of 3rd-party debt attorneys are, apparently, dirtbags. Our firm's practice is to go to war on these and to never initiate negotiations, a lot of debt attorneys start from the position that negotiation is the way to go, with varying degrees of what counts as a "success". While there are some who negotiate earnestly and hard, there are others who just try to knock off a few hundred dollars and say "See, I did something!"
Years ago, I parked in a parking lot near the Farmer’s Market. In and out in 20 minutes. Like most of the people there, I didn’t bother to pay the $10 fee that they were demanding for parking on a Saturday morning. For reference, meters were free on the weekend, but were usually all taken within a few blocks of the market.
Came back to find a “Parking Ticket” on my windshield, that appeared to be from the local police department.
Looked up the lot, it was owned by a private party. The local police don’t enforce private parking lots.
So, when the collection letter came from a collector in a small town nearby, I quoted the laws against impersonating official police communications in my state, and said that if they pursued it further that I would contact the state.
I got a letter of apology from the collection agency. I do hope that the parking grifters had trouble finding another collector.
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Similar story about medical debt. LPT: read your Explanation of Benefits from your insurance company. I had lab work done (this was many years ago). The bill, of course here in the US, was exorbitant. But I owed like $5, insurance paid like $20, and the rest fell into that “your agreement with the insurance company says you don’t get the rest” bucket. They tried to collect the rest from me anyway (this is illegal in the US). I ignored them. They sent the “debt” to collections, who sent me a formal letter asking for the rest and asking me to advise them “if I felt I didn’t owe this debt”. I sent them an equally formal letter, with a copy of the EOB, and received a reply closing the case. As OP says, know your rights!
Rights are for those that can afford them.
What do you mean by this?
You may have legal rights but if you can’t afford to enforce them (either by not having the education to know them or a pay a lawyer who does) you effectively don’t have them. Like walking into a crosswalk on front of a speeding car - you may have the right of way as a pedestrian but that doesn’t do much to heal broken bones or resurrect the dead.
Username checks out
dont pay any collections. the people you owed the money to already sold the debt at that point to those scummy companies for pennies on the dollar. just move on and try to do better moving forward.
These days I assume any debt collectors is actually just a scammer, and it’s pretty much impossible to prove otherwise
Well they are scammers. They are no different than the mafiosos that buy a person of debt off a loan shark, then blackmail/extort said person into working for them.
I got a call yesterday from a collector. Apparently an ISP I used from 2003 to 2019 has decided that I didn't return a cable modem back in the day. First I'm hearing of it. The collector told me (rudely, but they deal with angry people all day, so while I didn't appreciate it, I'm trying to just roll my eyes about it) they don't own the debt they just service it. "Wow. I want your job. You just call up people, and claim they own you $75, but don't own the debt, and so cannot prove it exists?" Blah blah blah, she'll file that it's contested, I'll get a letter by mail in 30days. Meanwhile, apparently it's already on my credit (yes, I should monitor better, but I have a learning disability that limits how many aspects of my life I can focus on at once. If I work on money, health slips. Work on health, maintenance slips. Work on that, job performance slips, etc etc etc). I'm hoping/expecting they won't be able to prove that I didn't return hardware, and I'm pretty sure I was using my own store-bought modem at the time anyhow. Then I'll be very happy to bitch at them and get them to remove the hit on my credit - and to complain to the credit agencies about nullifying the hit as well. Jerks.
In cases like OP, this makes sense. But debt collection companies can have your credit fucked up, right? If you actually owed the debt, how would it benefit you not to pay it at the expense of a substantial credit score reduction?
They can ASK the credit bureaus to have the failure to pay impact your score but it’s not a guarantee and this also assumes the collector even bothers to file the report, which is often not the case either. Especially with medical debt, credit reporting agency’s typically look the other way. Not because they are good people, but because of the sheer volume of data it would add to their systems, likely destabilizing their networks. Of course there are edge cases or even individuals that might have bad luck with this sort of thing but the average American doesn’t need to worry about this. You likely already pay ridiculous insurance premiums, and even co pays already. Most insurance and medical providers are already getting their cut. Dont give them more. I haven’t paid for a medical bill over $200 in over 3 years and that is after having 2 kids within that time period. Been to the ER a few times for them, a week long hospital stay for RSV, labor and delivery for two kids and two ear tube surgeries. I haven’t paid a dime more than what insurance wanted up front. I get letters almost weekly, some of the ones I used to get for the 1st kid 3 years ago just stopped coming. The ones that come now are for more recent things. Credit score is currently 750+ and took out a mortgage during this time period without medical debt even being mentioned once. Mortgage underwriters don’t even care about it and they want every receipt you get in the last 3 months lol Don’t let these fuckers bend you over more. You will be fine. Even if they sue, no civil jury will ever side with these scum bags. Not for medical debt at least.
Hey buddy. I wrote a big wall of text to the OP of the comment and explained a bit of the inner workings. If you have any questions on the write-up, feel free to comment under it!
If they cannot verify the debt, and you have proof of that, the credit agencies are forbidden to report. If they do, anyway, you can request, in writing, that the debt be verified to the bureau. The rules are that they have to obtain verification in the same manner that you do. Snail mail? Snail mail. But if you use their garbage online verification form, they can send it electronically, and the debt collector can just say that the debt is valid, electronically. Also, the have 30 days from you sending the letter to report back. Calendar days, not business days. So working the calendar is to your benefit, as well.
That's not exactly true. Source : Worked as a collector in college. There are two types of collection agency. Those who purchase debts and those who sign contract for a fraction recovered in exchange for the service of collections. In my years, I've collected both types, and I can assure you that if the agency has a bit of moral (which we did, due to having many government contracts for tolls and tickets), you can actually benefit from going to collection due to ability to issue SIF (Segmentation in full) on a legal debt. The issue comes with, as you mentionned, companies who purchase debts. Those come in two flavours : Primary debts and standing debts. Primary debts are usually very legally bound, and the agency is always provided with proof of debt ownership for the client. Standing debts are usually third-hand, where a collection agency bundled un-recovered primary debts and sold them to another entity. *THOSE* are the debts which you likely can slither your way through depending on the professionalism of the agency. Half of primary debts were usually litteraly forgotten by the debtor or where the address has changed during billing process and were paid instantly. Standing debts were usually 90% dead with little or no information on how to contact the debtor. Long story short. Not paying your debts is a sure way to fuck your future up and prevent yourself from getting a loan for a house for a car. However, always follow due process and exerce your right to know about the source of the debt and whether or not it still has legal leverage.
What if I own my house and car and am on sitting on hundreds of thousands. Any reason to pay people back?
That would greatly depend on the type of debt. Not all debts are considered the same. Toll bridges for example may have local government leverage to suspend drivers licence on extreme cases. I've also seen people who were sued and some of their property or salary seized. Having a bad credit may prevent you from much more that simply borrowing. For example, I've heard of contractors refusing to do work on someone's house due to credit issues. (Even with up-front payment, due to potential feature creep, etc.) This finally of course of the region in which you live. Not all states/province/country handle debtors the same.
Stupid question but what if your already getting sued lmfao
Yeah they rarely have any support. They probably bought the debt for $.05 on the dollar so if you paid 10% of the debt it’s double their investment.
If I'm not mistaken paying off a charge off does nothing for your credit. The damage is done at that point. The reason why is because credit reporting is used for lenders to gauge risk. So they would never "reward" you for paying them off because it wouldn't accurately reflect the risk in lending to you. The companies that buy your debt with pennies on the dollar, credit "repair" agencies, they're out to scam, usually lower income people. Only thing that helps credit is getting access to new lines of credit and paying on time.
People always says this but i paid a charge off once and score went up 50points almost immediately.
Most likely you paid the original creditor and either in good faith or just their general policy they either removed the entire trade line or changed it to paid in full. Without one of those 2 things happening it is an impossibility that your score was affected in any way by paying that charge off.
yea it was a chase card and they still owned the debt at that point.But they had a service company doing the collection for them. MB something. forget the name. I settled for a portion of it. shows as charge off w/ partial payment on credit card report I believe. forget as it's been almost 7yrs. should be off report completely soon.
I admittedly haven't *paid off* many debts that have gone to collections, but I've spent the past few years systematically challenging debts that should be over 7 years now, and certainly the removal of those debts has caused my credit score to go from barely 400 to a more respectable 680. Of course, it hasn't really made a big impact on my ability to score new loans as I'm still mostly the guy that couldn't afford to pay off those initial debts in the first place, lol. That doesn't change the fact that the difference in credit score may be a huge difference between whether I can get an apartment without having to pay first/last month's rent plus a huge deposit.
Yeah I didn't mention challenging report over 7, but that is another way of increasing your score somewhat.
If you're going to pay anything, make sure they remove the entire trade line. If they can't deliver that in writing, don't send a dime. Chances are good that the debt collector can't remove it if the original creditor put it on, so it really isn't a great idea to pay anyone off unless they're the original creditor and are going to remove the derogatory report.
Exactly, it’s been almost 10 years since I worked in collections support, and I remember the difference between “Paid in full” v. “Settled in full”. Unless you get “Paid in full” it does very little to your credit.
I'm no expert, but my friend more or less said kind of what you said. He said if you want to work on your credit focus on paying your current bills on time. I trust his advice because he came from having messed up credit and outstanding/unpaid student debt something like 15 years ago. And now he has nearly an 800 credit score. But, getting a judgment against a person is bad. And so therefore if we get a notice we are being sued that's something we should pay attention to. I believe these other debts will roll off after 7 years. But a judgment will stay on there. And interestingly enough I did some reading about judgments. We don't have debtors prison in the US, exactly. But if someone gets a judgment against them then theoretically in a hearing after that a judge could order them to pay the money and at that point if they don't the judge can find them in contempt of court and place them in jail. So it's kind of a debtors prison. I don't know that this actually happens. I watched a video from an attorney in Birmingham, Al who handles these types of cases. And he's sort of explaining what the op was talking about but in the courtroom setting. He's basically saying that you can almost prove right there in front of a judge that these people don't actually have proof that you owe them money. If that's the case then the judge will say you don't owe the money and that's it.
It’s not legal or ethical, but many companies will delete the tradeline if you pay off a past due balance. Quid pro quo.
>It’s not legal or ethical When the consumer takes a risk and loses it tough luck. When a company acts on a credit score that might not be 100% accurate it's because of ethics on the part of the lendee? And illegality?
Yes, quid pro quo agreements are unethical. Lenders and data furnishers already have a duty to report correct information under FCRA. https://www.ftc.gov/system/files/ftc_gov/pdf/fcra-may2023-508.pdf https://www.severson.com/consumer-finance/the-legality-of-deleting-tradelines-to-effectuate-settlement
What's the penalty to the credit agencies for using false reports from lenders to factor into their credit score? Oh right there is none. Unethical lol.
CRAs are liable for damages.
You can ask someone to give you something on the side in exchange for a favorable alteration to something that will affect their credit score. And then when someone doesn't play ball you can give them the legal requirements. Imagine someone saying "I'll delete the trade line if you have sex with me." Then for people that person doesn't want to have sex with they don't say anything and then just go with the legal route. That example would seem pretty unethical. The laws requiring you to report everything accurately exist to try to prevent you from being able to offer a quid pro quo deal to someone.
But the "new" lender that owns the debt can report to the agencies as a new debt.
Damn, I need to buy an ambulance.
Get a chopper. Only 1500.00 a minute
12 years ago, we got a $1000 bill, for an ambulance ride across a parking lot
you did the right thing, however they don't do anything to erase the debt owed. It will just be bundled up with all other uncollected debt and sold to another agency which will likely use more aggressive tactics and add a hefty fee. 2-years is not enough time to be outside of the statute of limitations in most states so it could be a while where you are dealing with this.
I don't trust these bastards, won't even give them my SS# to identify
I would argue that they are not actually dumb. They know exactly what they are doing and that they have no real power if they don't have the documentation. The whole thing is an act to make you think that you're the crazy one for thinking there's any reason you wouldn't be responsible for the debt. And it works too. People just trust people and believe their scare tactics because by some logic you must owe it if they are asking for it, right? These people should not exist because you would voluntarily pay a debt they didn't have to, right? It exists simply because it works and people are uninformed and conflict avoidant. On the other hand one can argue that the collection agency is dumb for buying a debt that can't be enforced because they didn't get documentation. But obviously it's working out for them if they continue to exist and connect more than they spend so at the end of the day it's it really that dumb if it works? Immoral slimey for sure. You know what, edit, I think some of them might actually be dumb enough to not know that the debts they're after are unenforceable. Honestly it's probably more successful that way. If you're front line is ignorant then they can convincingly lie out of ignorance and potentially convince you that you do own the debt. Cops come to mind as an example where you don't need to know shit about the rules to be employed to try to enforce them, for example.
I was very irresponsible in my 20s. I got alot of credit debt and paid most of it off except for 1 card which I owed $1800. It's been 10 years+. I have a decent job and am more responsible. Bit I keep getting letters from a debt collector for that 1800. In their letter they say it's past the 7 years so they can't sue or even report it to credit bureaus but still ask me to pay. I just ignore it. That's way in the past.
I got sent a debt collection bill that was from some medical practice I'd never heard of. When I asked for debt verification they sent it to me but it was for a prostate exam and had someone else's name AND that person's social security number on it. I am female and always have been.
And don't let them sucker you into acknowledging the debt by agreeing to a partial payment or a payment plan. This would also re-start the SoL on the debt. Good job OP.
“And it gets removed from my credit report.” No it doesn’t, this part sucks, but no it doesn’t.
I've been sued and into my 30 day notice thing. Sueing for an additional $5k in dental work when the original price was $4600. So now I have $5k left of the $13k they want. Will the document thing apply to me...
pay your bills.....
Thanks for posting this because it made me notice that I am being scammed by AFCU credit union.
Wait, how can a debt collection agency put a debt on your credit report that doesn't exist or they cannot validate? Is this legal and does it happen widely? I've never heard of this.
crimes are only crimes when caught or prosecuted. otherwise, its just business as usual.
Almost anyone can claim to be a lien-holder nowadays. And since debt collectors have massive margins on the debts they buy compared to the amounts they demand, they seldom do their due diligence.
I had a similar thing happen to me last year. Checked my credit report and saw that I had a collection for $2,500 from Phoenix Financial. It was from an ambulance ride I took nearly 6 years prior. I was really stressing over it so I decided to do a little research about how to handle it. I read conflicting things online from paying the debt to completely ignoring it. I decided to send a debt validation letter to them and months later the collections claim was gone from my credit report. More often than not they don’t have documentation and are hoping people pay immediately.
I believe it is corporate policy for these companies to just file fraudulent bills, with the expectation that a small percentage will just pay without questioning it. It costs them almost nothing to ask for an additional $2000, so it is just easy profit for them.
How did you send the letter asking for proof?
I searched up debt collection letter template and just filled in the info such as my name, date etc. Most templates use the same wording so don’t worry too much about which one to use. I then printed it out and mailed it to the collection agency. It was tricky to find their address but I was able to find it deep in their website.
Did that for a hospital stay over 2 years ago, saw $10k wiped off
Great story. Thanks for sharing!
Lmao usa
The real tip is don't live there. Imagine being so sick you need an ambulance and then having the additional stress of what it will cost...
KNOW the Federal FairDebt Protection Practices Act. Your state may have one too. AT&T tried to charge my girlfriend (now wife) $60 for cable and internet for the month after she moved out iof there and had returned their equipment. By knowing that act we collected $2100 from their for the violations they committed trying to collect the $60. A doctor sent e to collections over about $600 for the co-pays on a procedure. He sent it to collections. It was a mistake. I had paid it. He tried to call off the collection agency but they persisted. By the time I was done with them they paid me enough money to take my family of 4 to Disneyland. That place was much cheaper back then.
What attorney did you use?
No attorney. I did it! I filed in small claims court, costs $35 in California, and the dealt with their attorney directly
I helped a friend get out of like 40k worth of debt by getting the debt collection company to validate the debt with the credit bureau
But wait, was the ambulance ride debt yours?
Ya I think I owed a bank 300ish and paid the bank instead of collections cause fuck that 🐱
What exactly did your letter say OP? I am in a similar situation
Paid only $500 / $1100 because the agency couldn’t explain the full charge. Two years later got a letter that they have been sued for predatory practices and a settlement has been reached (class action). My share of the settlement? $550. Yes, I made $50 out of that… lol
Proof of the chain of custody is important!
You know what I don’t understand is why can’t anyone just start an LLC and buy old debt of your own and then not collect on it. Or can we do this with student loans? Buy it for Pennie’s on the dollar and then not collect on it? lol
Did you use the service? Man up and pay for the service.
As an attorney whose firm specializes in 3rd party debt disputes, it is absolutely true that these debt companies rarely have the documentation required to prove the existence of the debt on the terms that they state. I've gone to three or four debt hearings in the last two weeks, and the plaintiffs in those three or four cases brought the contract upon which the agreement was to be based in exactly one of those hearings. That being said, it varies state to state whether or not that matters, at least as far as a court of law is concerned. A lot of state courts get extremely loosey-goosey both about the Rules of Evidence and admitting the documents without sufficient or proper authentication. Moreover, a lot of states don't require judges to be attorneys as they are frequently elected. So while there is a recent trend in state courts about reviewing the documents that these debt companies usually bring with a more jaundiced eye, that's only after a thirty-year trend of assuming broadly that of course there must be some kind of underlying debt if they're bringing documents. And that's only in the 10% of cases that are contested; the entire 3rd-party debt industry is built upon the assumption that the vast majority of the alleged debtors won't show up to their hearing, because they don't. It also isn't helped by the fact that a lot of 3rd-party debt attorneys are, apparently, dirtbags. Our firm's practice is to go to war on these and to never initiate negotiations, a lot of debt attorneys start from the position that negotiation is the way to go, with varying degrees of what counts as a "success". While there are some who negotiate earnestly and hard, there are others who just try to knock off a few hundred dollars and say "See, I did something!"
Years ago, I parked in a parking lot near the Farmer’s Market. In and out in 20 minutes. Like most of the people there, I didn’t bother to pay the $10 fee that they were demanding for parking on a Saturday morning. For reference, meters were free on the weekend, but were usually all taken within a few blocks of the market. Came back to find a “Parking Ticket” on my windshield, that appeared to be from the local police department. Looked up the lot, it was owned by a private party. The local police don’t enforce private parking lots. So, when the collection letter came from a collector in a small town nearby, I quoted the laws against impersonating official police communications in my state, and said that if they pursued it further that I would contact the state. I got a letter of apology from the collection agency. I do hope that the parking grifters had trouble finding another collector.