How to deal with original creditor if they already sold it to a collection's agency?
February 13, 2012 3:08 PM   Subscribe

I've read from several askme questions that when dealing with a debt, it's better to deal with the original creditors as it can avoid having a collection agency on your credit report. I called the original creditor today, and they said that they no long have access to my fle and gave me the number to the Law group that has my debt. Is there any further pressing I can do so that this law group doesn't get the money and I can deal with the creditor directly?

The law group just reccenlty aquired this account in early January. FYI, I did not pay the original credit card company since May 2011 so it had been over 6 month delinquint. I was on a payment plan of 56$ on a debt originally around 3,500 (now down to around 1,300). I did pay this 56$ amount since April 2008.

Another FYI, the company might not exist anymore as it presently did as that's what the law group said (but they could have been bluffing, maybe?). Also, they haven't really been reporting on my credit report my monthly payments. It says it's 56$ on my creit report, and they reported it for maybe a year (2008-2009) but they stopped reporting it. What does this mean?

Should I bother paying it. Or will this make it last longer on my credit report because I have done an action to the account? This account is listed under the negative in my credit report. But if it's sold off to a creditor, then it starts a new one right where then I have to wait 7 years?
posted by eq21 to Work & Money (3 answers total) 3 users marked this as a favorite
Usually, if it's gone to collections, the original company has written off and sold the debt, so there's nothing to negotiate with them. Go to Consumerist and learn everything you need to know to deal with this situation (step one, inform the collections firm that they must prove that it's a valid debt).

I *think* (IANAL) that if you've contacted the collections firm and did anything other than dispute the existence of the debt (like asking them how much you owe), then the 7 year clock resets.
posted by kjs3 at 3:42 PM on February 13, 2012

>Is there any further pressing I can do so that this law group doesn't get the money and I can deal with the creditor directly?

No. Once the credit agency has the account, you need to deal with it. The advice about the original creditor applies only while it still keeps the account.

The rest of your questions are not clear. You said you were paying $56. Have you paid that regularly since April 2008? The fact that it was referred to a debt collector suggests not.

If you have made payments that do not appear on the report, then you need to file an explanatory rebuttal.

The collection agencies will probably deal with you, and work out a payment plan. Pursue that.
posted by megatherium at 7:27 PM on February 13, 2012

Best answer: Some OCs will buy back (recall) the debt if you're offering them a lump sum settlement. The only way you're going to get their entry off your report is to get them to do that and then recall the debt. Even if you do manage to get the collection agency off through a pay-for-delete scheme, you've got no leverage over the OC, so you're stuck asking for a favor, essentially.

If you stopped paying in May 2011, that will be the date from which the statute of limitations and 7 year reporting clock run, barring any further payments or promises to pay or you leaving the state.

I would suggest looking out very carefully for violations of FDCPA, FCRA, and your state's debt collection laws, if any. Statutory damages can be strong leverage, especially for small balances like this. Check everything about how the account is reported. If the balance, date of last activity, or anything else is off about it, you may have hope. The whole idea is to get whatever leverage you can, whether that's $1500 to settle the account now or $5000 worth of statutory damages they'll be on the hook for if you sue them for incorrect reporting.
posted by wierdo at 9:38 PM on February 13, 2012 [1 favorite]

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