I just received a letter from a collection agency demanding payment for a heat pump I never ordered. This is a very complicated situation, so rather than trying to explain it I’ll just ask if it ever does any good to call the agency and explain the situation, or should I not bother.
When I was contacted on a baseless collection I never called them back. I let them spend their money pursuing me, then I had my lawyer yell at them and it all went away.
You cannot ‘explain the situation’ to a collection agency. They do not care. They purchased your debt from a creditor and are trying to collect on it.
However, there are other things you can do:
-Arrange a payment plan
-Inquire about a settlement
And my favorite:
-Arrange a “pay for delete” (basically you agree to pay them in exchange for them taking the negative item off of your credit report). However, this will only work if you ask REALLY nice. Credit bureaus don’t like it, and as such, many if not most collection agencies will be hesitant to go for it.
ETA: I just noticed that this is a baseless collection attempt. In that case:
-Refuse to pay
-Dispute the negative item with the credit bureaus. The collection agency is required by law to provide proof that the debt is legitimate. If they cannot provide proof in a timely fashion, the bureau will remove the negative item.
Never ever call unless it’s a legitimate case of mistaken identity.
If you must, send a letter.
Be guarded in what you say.
You may provide them more evidence for their cause than they had before. I would suggest having an attorney handle the letter.
I could quickly cross the line into acting as your attorney here, so I’ll withhold some comments.
You have the right to demand validation.
Consider sending a ‘demand for validation’ letter ASAP.
It forces them to stop collection activity before they provide you proof of the existence and validity of the debt. This also restrains them from engaging in credit reporting until they validate.
In practice, they’ll either answer you in 2 months with evidence or send the debt back to the original creditor.
The collection agency was either hired by someone whom you supposedly owe money, or is a scam. If you did not actually order or receive anything, you need to contact the party that hired the collection agency and tell them to cease and desist, lest you take serious legal action against them. They’re the only ones who can call off the dogs. Collection agencies care nothing about excuses and complicatied stories.
No. Do not bother.
The collection agency only cares about them getting their money. Generally, they will lie to you, abuse you, mock you, and try to make you feel like a scumbag if that makes them get their money.
I called up a collection agency once trying to explain that the amount in collections was in dispute, and I was still in contact with the original company, so please stop sending me letters for now. They responded by literally calling me a deadbeat who didn’t want to pay for something, and asked insulting questions like “why do you want to get out of paying your bills, Ma’am?”
Only contact the original company. If you cannot, then do not bother with the collections agency except in writing. They are vicious; tread carefully and do a lot of research. Do not promise anything.
I have a similar ongoing issue- got a collection agency bill for 30 bucks or so from a company I don’t recognize. It could be something legitimate I owe, or it could be a mistake, I’m still not sure. I called the collectors and asked them to have the company send me an itemized bill stating what exactly I owe, and what for. I have called the agency several times, still haven’t gotten the bill, and the (fairly nice) collection people notate that I call and ask for proof and still haven’t received it, so they have never called me for payment. This has been ongoing for a while, and I’m not even sure if this was ever on my credit report, or still there, or what.
If a collection agency “bought” the debt from someone else, why does going back to that original someone else help?
For example: Let’s say I owe Sears $750 for a new vacuum. I forget/neglect to pay. After some time, Sears “sells” my debt to a collection agency. Now my debt is with Vinny’s Debt Collections & Auto Body Co., right?
If I call Sears, won’t they just say that as far as they are concerned, that account has been closed, and the debt sold off?
What am I misunderstanding?
It’s installed and operating.
Here’s what happened. I was building a new house and the HVAC contractor installed a heat pump that was so noisy it would have been impossible to even use the screened porch, and you could hear its pulsating whine throughout the house. However, it did have a two stage condenser and did a good job of cooling the house.
I asked the contractor what I could do about the noise and he said either pay for a more expensive, quieter unit, or move the existing unit away from the house. I told him to let me think about it.
In the meantime he just went ahead and ordered and installed a new more expensive unit that was definitely quieter but it wasn’t a two stage system. I told him that I never ordered the thing and because it wasn’t a two stage unit I didn’t want it, and to take the thing out and put the old one back in. (This wasn’t the only problem I had with this guy and I had decided to go with a different contractor)
He basically said that I did order it and he wasn’t going to reinstall the old one and that I would be receiving a bill. I never paid the bill and now I have the letter from the collection agency.
Thanks for all the advice and I think I’ll probably just hire an attorney to take care of it for me.
Contact the Attorney General in your state and have them send a letter to the heat pump firm. They should be pursuing the contractor, not you.
Now I’m curious as to what would constitute proof that the debt is legitimate? They certainly don’t have anything from me, but I’m sure the contractor has proof that he purchased the unit. Is that enough?
“Adequate proof” has been established, for purposes of the FDCPA or Fair Debt Collection Practices Act, by a combination of federal case law and Federal Trade Commision opinions.
The answer to your question confuses even the lawyers who practice in that field of law.
The gold standard is a piece of paper with your signature on it, preferably notarized.
What counts as “proof” beneath that, and for FDCPA purposes gets quite murky.
mlees,
There are two ways for collections to be handled.
The first way is to call up a collection agency, hand them a portfolio of bad debts, and give them a % of what they can collect.
The second way, as you outlined, is to sell off the debt.
The “higher-quality” the debt in question, the greater the chance the first way will be employed.
The “lower-quality” the debt in question (meaning the ones where collection is very doubtful), the greater the chance that the second way will be employed.
There are, of course, companes that ALWAYS use the second way, even with what they believe to be good debt.
Some medical offices outsource not only collection but also billing; essentially, even your first bill goes to a collection agency, though they’ll represent themselves as a medical billing agency. If your bill there ‘goes delinquent’ you’ll be contacted another ‘department’ in the same company representing themselves as a different company and representing themselves as a collection agency.
In these cases the medical service providers receive payment for 90-95% of the bills referred to the collections agency, rather than getting paid a relative pittance for their 180-day delinquent receivables.
As an aside, if you wish to avoid receiving their phone calls, you can use the line,
“I’m sorry, but the boss does not permit us to receive personal calls at work.”
They’ll generally apologize and hang up at that point, without asking if you’re actually at work or if they’re calling a work number. You will likely not receive another call at this number for at least a few weeks.
I would just add that, in this state, it is not at all uncommon for debt collectors to have a process server lie about serving you and thereby get a default judgment against you in court because you never knew you were being sued. There are several class actions going on to end this practice, but it continues, and I’m sure it happens in other states. You can get such a judgment vacated, of course, but not without significant effort. So, make sure you keep a close eye on the issue.
The site below says the following about proof of debt:
The debt collector may renew collection activities if you are sent proof of the debt, such as a copy of a bill for the amount claimed by the creditor.
Man this sounds flimsy as hell. I certainly hope you are correct and not this site. I’d
certainly prefer murky to this.
http://www.expertlaw.com/library/consumer/fair_debt_collection.html#8
As others have already mentioned, don’t talk to them unless you feel you have something you might want to settle. I get frequent collection agency calls for a couple of my very close deadbeat relatives who actually live across the country. I rarely answer, and usually tell them “wrong number” when I do. Once, my curiosity got the better of me and I asked the caller for information about the debt they were trying to collect (it was a relative’s debt). I clearly explained I wasn’t the person they were looking for, and I was not contractually obligated for the debt in any way. They were polite at first but kept addressing me as the person they were seeking. First, they just said “call us and we’ll set up payment plans”. Now they leave a couple of messages a week, gradually ramping up the pressure and giving more veiled threats of action. Regardless, of what you tell them, they be relentless because you gave them an in.
One out that has always worked “This is in the hands of my Lawyer, all further communications should be through him”.
I have also been told that if you say you do not owe the money and you will not pay they are supposed to stop calling?
From recent experience, I can say they’ll quite likely use the call to try to tease out new bits of information from you such as your birth date, contact numbers, details of your employer and so on - all of which will assist them in pursuing you.
Hire the attorney.