Question about debt collector who purchased my credit card debt

Factual Questions
1

A debt collection company contacted me recently trying to collect on an old credit card debt. It’s a card that I haven’t had or used in at least 2 years, and I thought I had paid it off and haven’t gotten any bills or correspondence from them in the past 2 years.

Anyway this debt collection company bought the debt from Chase Bank and are now trying to collect. They said that interest is still accruing. They want to settle it or set up a payment plan.

My questions are these: first, can I still be charged interest by the debt collector considering that Chase Bank has “charged off” my debt and sold it to a third party? Second, should I request that they send me any sort of documentation about the debt before I pay them? What should I ask for?

What else should I know about dealing with these debt collectors?

Thank you!!

2

My brother works on debt collection but is unavailable at this moment. At any rate, I had a similar situation which I resolved by just paying up to get it out of my way (small amount). When my brother found out he almost killed me for paying. If the debt is so old, it should appear on your record at the worst possible level (something 9, I think). There is nothing they can do to hurt your credit any more. And if you pay up, they won’t correct your record anyways. So it is money down the drain.

Now wait for someone who really knows what he is talking about.

3

Start with the Fair Debt Collection Practices Act. There’s a lot of good stuff in there.

Dispute the debt in writing, within 30 days, and they have to cease collection until they mail you verification of the debt or a judgement for the debt. Section 809 (b)

4

I looked in the link, but didn’t see anything about this. Is there a statute of limitations (in years) after which collection attempts must cease?

5

[QUOTE=Cheesesteak]
Start with the Fair Debt Collection Practices Act. There’s a lot of good stuff in there.

Dispute the debt in writing, within 30 days, and they have to cease collection until they mail you verification of the debt or a judgement for the debt. Section 809 (b)
[/QUOTE]

Thank you, that is just what I did - I asked them to send me the required information from section 809. So then I will dispute it in writing and see where it goes from there.

I am interested to find out more about what Sapo said. If I pay, will it improve my credit any, considering that Chase Bank charged-off the debt already and that is on my credit. Will paying it help with that any or is the damage already done?

6

[QUOTE=nyctea scandiaca]
Thank you, that is just what I did - I asked them to send me the required information from section 809. So then I will dispute it in writing and see where it goes from there.

I am interested to find out more about what Sapo said. If I pay, will it improve my credit any, considering that Chase Bank charged-off the debt already and that is on my credit. Will paying it help with that any or is the damage already done?
[/QUOTE]

First off, I am not a debt collector, but I have been more or less successfully fighting them off for several years now, and repairing my credit at the same time. Currently the only thing I still owe on is medical bills – all my credit card debt is GONE, and my credit rating is going back up (slowly).

What Sapo said is true, to an extent. If your credit is already in the toilet, then paying them off won’t fix it. But there’s a big fat BUT attached to that.

IF you do not pay them off, AND the debt is valid, then they can start reporting to the credit agencies under their own name. Which will not damage your credit any further, it’s true, but it WILL prevent you from repairing your credit.

Now, you stated that Chase ‘charged off’ the debt. This may not be the same as you paying it off - if you had paid it off, it could not have been sold to a debt collector (assuming it’s not a glitch at Chase’s end, for example). If you had reached a settlement with Chase, that would be equivalent to paying it off (although it wouldn’t have helped your credit rating any). A settlement is where the credit issuer (ie, Chase) agrees to let you pay a smaller amount than that actually owed, usually because they figure if they don’t, they won’t see anything – half a loaf is better than no bread, and all that.

So, it all hinges around how legit the debt is. :slight_smile:

Anyway, if it IS legit, your best bet is to negotiate a payment plan. This is where it gets ugly, because they’re (probably) going to start by asking for something like 15% of the total debt per month, and you have to work them down from there. Do NOT let them convince you to hand over your pay stubs and copies of bills, etc, so they can work out a ‘reasonable’ payment. Remember, their job is to GET YOUR MONEY, and they could care less about other creditors. I have personally witnessed these sorts of places state that someone living on a fixed, barely-marginal income could afford to pay $200/month by cutting down on food expenses and medical treatment.

Also, you generally have to agree, in advance, to accept whatever payment they propose after going through the process to be ‘eligible’ for payment plans at all.

So, DON’T DO IT. :slight_smile:

Set up a payment plan, be prepared to argue (politely) and defend your position, and don’t give them any more information than is strictly necessary (like your place of work, for example – if they want that, they have ways to legally discover it anyway). But don’t just ignore it, because that’s just investing in trouble down the road.

If you can, borrow money from relatives or the bank (assuming they’re willing) and pay the debt collector off in full immediately. Having cash in hand is a wonderful bargaining tool – I’ve told collectors “I might be able to get X from my dad, but he’d never let me have Y” and had them reduce the debt right then and there. Whatever you do, DO NOT play this card unless you can back it up (ie, don’t play around unless you’ve got the funding in your hands).

Oh, and while I’m pontificating: avoid letting it go to court, if at all possible. If it goes to court you’re going to get saddled with the attorney’s fees, filing costs, and other bunk - to the tune of $200 or more, at least, usually.

–sofaspud

7

Err depending on how old the debt is, it could be in your best interest to NOT pay it. After seven years it will fall off your credit report. And even if it’s only been about 4 years or so, an old unpaid collection will still count against you less (score wise) than a current paid collection.

I am not a collector but I worked in a company once that did collections. And when it comes to collection companies, the size of the debt directly correlates with how aggressively they’ll pursue payment. If it’s a sizable amount and they can prove you owe it and are more than willing to go to lengths to get it back, you probably should pay it before they start aggressive collection methods (lien on your house, garnishing paychecks, getting a judgement). However if it’s a small amount… Well they always work those right away, hoping they can ‘scare’ the person into paying up. However, most of the time if nothing comes of it, it often gets forgotten for more lucrative collections.

You’re doing the right thing by asking for proof. I’d also highly recommend getting a credit report so you can see what exactly is already on there.

8

Don’t do nothing. Somebody has purchased a potential lawsuit against you and you should treat it as such. First, read this article: ‘Zombie’ debt is hard to kill

Then, talk to an attorney experienced in credit card debt collection defense; in fact, talk to as many as you can reasonably take the time to do so. I do cases like this all the time, and many times they’re circumstances like those in the article: a creditor who buys literally thousands of credit card debts for pennies on the dollar, some of which are unprovable or barred by the applicable statute of limitations, basically buying a worthless lawsuit. The problem is that even a worthless lawsuit can be expensive to defend oneself against, and they often sue people who don’t deal with them, hoping they’ll do nothing and the credit card company will get a default judgment against them for not answering. Even bad cases are a headache to defend, though: read my post #29 in this thread to see just how big a headache.

Many lawyers won’t handle these kinds of cases because they can involve a lot of work and they feel like they’d have to charge a lot for them, or they just don’t know how, or don’t do that kind of law at all. However, the lawyers who file the cases for the credit card companies sometimes don’t know how to prosecute them at all, either; yours may be one of hundreds of cases they filed that day and yours may be the first one they’ve ever seen answered, and if it’s apparent your lawyer knows how to make them prove their case and they can’t, your bargaining position improves dramatically. I have gotten extremely reasonable settlements in these sorts of cases, and even had some dismissed entirely.

I’m not saying that will be true in your case - I have no way of knowing and could not possibly evaluate it from what you’ve told me, and am emphatically not doing so. What I am saying is you should consult a lawyer (several lawyers) in your jurisdicion with credit card debt settlement experience. Don’t be afraid to ask how they defend these cases, how many they have done, etc., and get several opinions.

This is not legal advice. I am not your lawyer and you are not my client. Consult a lawyer licensed in your jurisdiction.

9

oh, and I also understand that when you talk to them on the phone, they take very specific notes about what YOU say but not what they say. This means: don’t let them piss you off and make you go ballistic. Repeat everything they say. FWIW.

10

I would suggest that you should never pay to a collections agency.

The goods or services were supplied to you by Chase; they are the people who you legitimately owe. Pay them, nobody else.

I was once threatened by a collections agency over a debt to a hospital for medical treatment. I called the hospital, and arranged a payment plan with them (much better than what the collections company was demanding). And I paid it off to the hospital in about a year.

Meanwhile, the collections company continued to call and mail bills to me. I simply told them I was making payments on this to the original provider. They said no,no, I should be paying money to them! I said that it was the doctors at the hospital who had cured me, not them, and I was going to pay the hospital, not them. And that the hospital did not harrass me with phone calls, either. In fact, after I made the last payment to the hospital, I received a thank-you note from them.

Several years later, I encouraged my mother to choose this hospital for knee replacement surgery. So they got thousands of dollars of business because they treat people right.

I simply refuse to deal with collections companies – only with the original people who provided the service to me.

11

Here’s a reference you might find helpful:

Linky

It also includes a statute of limitations chart, broken down by state.

The collections agencies routinely shuffle files. So, you can hear about an allegedly unpaid debt for years and years. However, that doesn’t mean paying them is the best option, depending on how old the debt is and where you live.

FS

12

I agree with those who say don’t pay the collection agency. They will call and send threatening letters about ruining your credit rating. If you really do owe the money to some party, arrange to pay them. If you don’t owe the money and if it appears on your credit report, write to the credit reporting company and explain why it should be removed from the report. Take it from someone who’s been through the process.

13

As soon as you get your first letter from a collection agency, send a demand for validation. Send it certified.
Once you do that, you place some administrative burden on them, and if they screw up, it provides you handsome leverage later.

14

[QUOTE=Mr. Slant]
As soon as you get your first letter from a collection agency, send a demand for validation. Send it certified.
Once you do that, you place some administrative burden on them, and if they screw up, it provides you handsome leverage later.
[/QUOTE]
In this letter, tell them not to contact you by phone. A collection company tried to collect on a debt that my husband and I had already paid off. Talking to them on the phone was worse than useless, so I fired off a polite but very firm registered letter to them. I disputed the debt, told them to quit calling us on the phone, and told them that I had found some instances where they had collected on debts that had already been paid. I noted that the FTC had already fined and warned them, and that I was sending a copy of the letter to the FTC. I never heard from the collection agency again.

Personally, I think that if you owe the money, then yes, you should pay it off. But make them PROVE that you owe the money.

The above post should not be taken as legal advice, I am not a lawyer. I’m just relating what worked for me.

15

Do you have a friend who is a lawyer? Any sort of lawyer? Becuase if you do, telling them “nevrer contact me again, call my Attorney- Jim Smith Esq. @ 1-800-555-1234” is a nearly certain way of neither of you ever hearing from them again.

Seriously, I have a few lawyer friends,and the Collection leeches were doing this to my then Fiance, and one of my Attorney buds said “Sure, I’ll let you use my name, and ever talk to them on the phone once or twice- I’ll just give them a little boilerplate. If I have to do any real work,I’ll have to charge you. But I don’t think I will have to even answer their call”- and he was right.

16

[QUOTE=t-bonham@scc.net]
The goods or services were supplied to you by Chase; they are the people who you legitimately owe. Pay them, nobody else.

[/QUOTE]

While I agree with you when it comes to scumbag companies that harass you, your statement is not really correct. For the goods and services you have given them a financial instrument. That being a promise for you to pay in the future. The ability of this financial instrument to be sold on the open market increases it’s value and that ‘should’ reduce your interest rate. This is a common, but annoying, practice with mortgages.

17

Dear Messrs. X and X

This letter is in response to your correspondences dated __________________ respectively (copies enclosed) regarding a disputed debt from _________that you are attempting to collect. The legal Statute of Limitations of 3 years for collecting this type of debt in North Carolina has expired.

You may consider this letter as official notification that, should you decide to pursue this matter in court, I will not only invoke my legal rights and use the “expired statute of limitations” as my defense, I will vigorously pursue recompense of actual damages (if any), and attorneys fees and costs should it become necessary to retain counsel.

Be advised that I consider this matter closed and demand that you, or anyone affiliated with your company, cease and desist contacting me regarding this matter except to advise me, via mail only, that your debt collection efforts are being terminated.

Thank you very much for your prompt attention to closing your files on this matter. I look forward to receiving written confirmation of same.

Sincerely,

North Carolina Statute of Limitation:

Express or implied contract, not under seal: 3 years.

Contract and sale of personal property under seal: 10 years.

Open account: 3 years, NOTE: Each payment renews the SoL on all items purchased within the 3 years prior that payment. If no payment is made, the SoL runs from date of each individual charge. Contracts: From date of breach or default, unless waived or performance under the contract is continued.

Applies, of course, to NC. Your state may be different.
Again, this is a generic form letter.

18

I know nothing about the legal situation, but after reading all the replies…doesn’t anyone else think that if he indeed owes the money, and can now afford to pay the debt, he should? Out of, well, honesty?

At some point in the past he got various goods/services and in return promised to pay $XXX for them, plus interest until he paid them back. Presuming that he got the goods/services, and they weren’t defective or anything, why shouldn’t he pay for them? (Assuming he can, of course.)

Otherwise…how is it different from stealing? Just because he delayed and delayed on paying long enough?

19

[QUOTE=StarvingButStrong]
I know nothing about the legal situation, but after reading all the replies…doesn’t anyone else think that if he indeed owes the money, and can now afford to pay the debt, he should? Out of, well, honesty?

At some point in the past he got various goods/services and in return promised to pay $XXX for them, plus interest until he paid them back. Presuming that he got the goods/services, and they weren’t defective or anything, why shouldn’t he pay for them? (Assuming he can, of course.)

Otherwise…how is it different from stealing? Just because he delayed and delayed on paying long enough?
[/QUOTE]

I don’t see any indication that the OP is not planning on paying the money, just that they want to know their rights and remedies when paying.

20

[QUOTE=StarvingButStrong]
I know nothing about the legal situation, but after reading all the replies…doesn’t anyone else think that if he indeed owes the money, and can now afford to pay the debt, he should? Out of, well, honesty?

At some point in the past he got various goods/services and in return promised to pay $XXX for them, plus interest until he paid them back. Presuming that he got the goods/services, and they weren’t defective or anything, why shouldn’t he pay for them? (Assuming he can, of course.)

Otherwise…how is it different from stealing? Just because he delayed and delayed on paying long enough?
[/QUOTE]
Read my earlier post, #14. Also re-read the OP…the OP thought s/he’d already paid it off, but isn’t certain. Since the lender hadn’t contacted the OP for a couple of years, I think that the OP was reasonable in assuming that the debt was paid off.