Sent to collection agency for 20 cents?

General Questions
#1

So - in 2012 at Christmas time I spent some time in the hospital and ran up 262.20 cents in radiology bills. In March of 2013, I paid 262 online by visa and forgot to include the 20 cents. I never received another bill from them and didn’t know I"d made a mistake.

Lo and behold I go to check my credit report yesterday, and learn that they turned it over to collections last year and said it was $79 instead of 20 cents. So I have a now $87 derogatory on my Transunion. I called the collection agency to ask why I had never heard from them about it and they said they mailed me a letter last April, but I know I never got one. I’ve never heard anything from anyone about this princely sum of 20 cents that I under paid. If not for CreditKarma, I wouldn’t even know about it.

The radiology place says they’ll investigate, but I don’t know if they’ll actually do anything. Do they have to?

The collection agency asked me to fax them my proof and I did, but I doubt they’ll do anything either. Do they have to?

I guess I’ll have to go to Transunion and dispute this.

Fuckers. (Can I say this in GQ?)

#2

Back in the 90s, we were buying our first home. We were pre-approved for the mortgage, found the house, made the offer, and were working on the actual mortgage paperwork, when we were told that there was an $80ish charge in collections, and we couldn’t get our mortgage approved until it was cleared up.

Turns out it was a $15 parking ticket, that we had never gotten, with a car description that didn’t match ours. But we had to have that mortgage, so we paid it and moved on. As far as we could tell, the city never tried to contact us, because it wasn’t worth it. They sold it, probably as part of a package for a fraction of that value, to collection agency, who slapped $65 in fees on it, and didn’t ever notify us, because it wasn’t worth the time to do so. I’m sure that they get some portion of their small not-worth-sending-a-letter collections from people just like us, who HAVE to have it cleaned up now.

As for your $0.20 vs $79.00? Probably late fees or something like that.

#3

Do you have an attorney friend?

Have this person send the collection agency a letter stating that you will sue them if they do not remove this from your credit report. You should see this removed or you’l be able to file suit against them and make a tidy profit.

Personal experience: A drug store chain which is now closed stated that I rented some videos from and did not return them. The debt was sold to a collection agency and I was prevent from purchasing a a large ticket item on credit. I had an attorney friend send them a letter, they still didn’t remove the false charges and we ( myself and the attorney) split a nice settlement with the collection company for their refusal.

Hopefully you won’t have to sue; but I would be prepared to protect your credit report if necessary. Even if you pay, there’s no telling if they will remove the blemish from your report.

#4

Go to creditboards. That’s where people who just live for this kind of stuff hang out. They have formulas for dealing with this sort of thing posted. Follow their advice and the collection agency may end up owing you money. But you have to act quickly in some cases to preserve your rights.

But before you post there, read their FAQs and their NEWBIES START HERE posting.

#5

No, not late fees. They say that was the original amount - the late fees make it $87. I don’t see how they can do this. I have proof that I paid it all except for 20 cents. I now await my Transunion report so I can dispute it.

Oh well. This will keep me occupied for awhile.

Sad to say I don’t have any attorney friends.

#6

My daughter received statements from a natural gas distributor for a house she had rented that claimed she owed them, $0.01 and she received those statements for more than a year. There was also a requirement that the only payment method was a money order.
She would always say, “Dad what am i suppose to do”?
She finally got someone on the phone and asked why they are spending money on that and the bills finally stopped

After that i had a dispute with ATT&T and after i finally paid them but in doing so i overpaid them $0.02 and for months after that i would get statements that i had a 2 cent credit. Then it ended when they bought out the cell company i was using. :frowning:

#7

After my mother died and I was settling her debts, I got a $.04 bill from Medicare (or some other incarnation of the healthcare system; that doesn’t sound quite right). I phoned them and asked the customer rep and asked if they really wanted me to mail them a check for four cents. She just laughed and said “of course not, I’ll take care of it on this end.”

The following month, yep, I got another notice and I went ahead and mailed the check for 4₵, because I knew the alternative was winding up in a story like this one.

#8

People are making this out to be way harder of a problem to solve than it is in practice. I have dealt with versions of this problem on a slightly larger scale several times before. The OP already gave the solution but seems unwilling to do it for some reason. All you have to do in situations like this or even much larger ones is file a dispute with the relevant credit reporting agency (Transunion in this case). It takes 5 minutes tops if you have a copy of your credit report in hand (order that in advance; it is free once a year for each of the credit bureaus and again and that can be done online as well).

Dispute the charge officially with the credit bureau. Claim you have no knowledge of it even if you have some vague idea of where it may have come from. From there, you have legal protections and it works similar to a civil court case except you don’t have to do anything further. The credit bureau has to investigate and find proof that you indeed, owe that debt within 30 days and the party making the claim has to provide detailed proof to them.

If any of the parties involved cannot meet that proof, it gets wiped from your report forever and no one can ever contact you about it again (if they do, you can receive substantial compensation for it if you make a counterclaim).

This is the easiest game in the world to win even for much larger debts if you know the rules and how to play them. Do you think any company is going to want to go through the trouble of proving a 20 cent debt? I don’t either.

The solution is simple for this and all other similar scenarios. Just file the dispute, claim no knowledge of the debt and then watch it be wiped off your record forever. I have had a 100% success rate with that tactic over the years even for larger so-called debts. I have never had one take more than 36 hours to be wiped forever.

#9

Shagnasty - do I get to submit my proof to Transunion that the bill was paid except for the 20 cents? The Collection people are saying it is 79 bucks, not 20 cents. You say these things are easy, but if justice so easily prevailed the radiology people would not have sent this to collections at all. Things never work out quite so easily in my life, even when they should. Hence the reluctance.

#10

Oh - and they never did contact me about it. I only know about it because it popped up on CreditKarma. The collection agency claimed they sent me a letter last year, but they didn’t or I would have been screaming about it then.

#11

It really is that easy.

Go to www.annualcreditreport.com (that is an official site for requesting your free credit reports once a year or whenever you are denied credit because of an entry; it doesn’t cost you anything). Request your Transunion credit report and you will get it online instantly. Follow the process to follow a dispute. You don’t have to send them anything or tell them anything. Just request an investigation and choose the options that say ‘I have no knowledge of this debt’. Don’t provide anything other than that as an explanation.

It will be almost certainly be gone for good within 24 - 48 hours and you will never hear about it again. If you don’t have a guilty conscience, you can do that with all bad entries. The burden of proof is on them to go back and prove that you really do owe it. They have to send you a written reply with the evidence within 30 days of your complaint to prove that you do owe the money. That generally does not happen unless there is a substantial amount of money involved.

#12

Shag - Transunion wouldn’t let me get a report online. They say they can’t verify my identity. So I called and should get a report by mail.

Why do I need to lie and say I have no knowledge about it? I did inadvertently try to skip out on 20 cents, after all. Isn’t there an option saying “This bill was paid?” Or does it amount to the same thing?

#13

Send them a certified letter that you are willing to negotiate payment, but only on the actual owed amount of $0.20.
Offer them $0.02, on the condition they report to the credit agency that the debt is paid in full.

#14

It doesn’t seem like you have any knowledge of where “that debt” came from - “that debt” being the full amount in question.* It seems like a reasonable response considering the limited options you’re choosing from (“bill was paid” seems like you’re saying that you paid all of it, but since you don’t have any idea where most of it came from, that seems like an incorrect response, you definitely didn’t pay the amount that they are talking about). Why should you have to explain all of the details when they are the ones asking for payment of a sum that seems to come from thin air? The burden should be on them to prove it since it seems to be completely made up.

  • not a legal opinion, just my general thoughts
#15

No, definitely don’t do that. If you send them any such letter or make any type of payment, it will validate the collection and it will stay on your credit report for up to 7 years. The amount of the collection generally does not matter. They are bad news to have on your credit report whether it is 1 cent or $10,000.

Dispute it and get it off of there for good.

#16

Well, Shag it’s too late to pretend I don’t know what it is. I already sent them (the Collection bastards) a sarcastic email yesterday offering to send them 2 dimes to consider the matter closed and copies of the bills and receipts proving I paid all but the 20 cents. Stupid, in retrospect I guess.

#17

Silly me. I actually thought I could straighten it out with them.

#18

As a rule - you have 2 options -

a) attempt to settle the matter
b) dispute it

you chose option (a) - and in doing so - you actually validate the debt (to some degree) and gave the collection agency more power over the entire matter - which includes keeping the delinquency on your records for an additional 7 years.

If you choose option (b) - the onus is on the collection agency to validate and prove the debt - if they can’t (or choose not to) - then they have to remove the delinquency from your credit report immediately. If they are able to validate and prove the debt, then you have option (a) to work with.

Given the amount of the debt - and for many such debts, regardless of the amount - once sold to second and third (etc) party collection agencies - the correct course of action is always option (b) to start with - as you can always opt for option (a) should the validation be, well, valid.

#19

In almost every jurisdiction you will not be contacted for failure to pay a parking ticket. It’s either turned over to collections and/or your plate is suspended. And you don’t find out about that until you try to renew, or get pulled over for something and have “driving with suspended registration” added to whatever you got pulled over for. Parking tickets can actually screw a guy up big time in the long run!

#20

You shouldn’t ever do those sorts of things with a collection agency. No good can come from it but you know that now.

You might still be able to get rid of the entry. You still have the option to dispute it with Transunion no matter what you sent to the collection agency. You may get lucky and they may not remember your e-mail or simply not care to document it because the amount is so small. You have nothing to lose by disputing it (or any other entries for that matter).

If they do validate the debt, that is bad news to have on your credit report for up to 7 more years and it will probably cost you significant money if you have to take out new loans, get a credit card or refinance your home. Collection agencies can remove entries from your credit report if you negotiate it with them. If the dispute fails, you could tell them that you only truly owe 20 cents but you will pay them some amount of money more than that if they will take it off your report. Get that in a letter if it comes to that. It may be worth it to keep your credit score from getting dinged for so long for such a small amount.