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
Be very careful with old debt as an expired statute of limitations in some states can be
restarted by making any amount of payment on an old debt, entering into an agreement plan
to repay the debt or even acknowledging you owe the debt.
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 and get everything in writing.
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.
There are many consumer laws on your side in repairing your credit. Knowing your rights will
greatly increase your efforts in repairing your credit. If you do not have the free time to
research your rights, Let a Law Firm Remove your Negative Items from your Credit Report!
Previous Page 1 2
restarted by making any amount of payment on an old debt, entering into an agreement plan
to repay the debt or even acknowledging you owe the debt.
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 and get everything in writing.
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.
There are many consumer laws on your side in repairing your credit. Knowing your rights will
greatly increase your efforts in repairing your credit. If you do not have the free time to
research your rights, Let a Law Firm Remove your Negative Items from your Credit Report!
Previous Page 1 2
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:
 |
 |
 |
 |
|
 |
|
 |
|
 |
|
 |
|
 |
 |
Recent Topics
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
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 expired, the original
creditor or the collection agency
cannot sue you for the debt.
The debt becomes uncollectible. 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 expired.
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 expired, the original
creditor or the collection agency
cannot sue you for the debt.
The debt becomes uncollectible. 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 expired.