How to stop a collection agency from calling on a loan it doesn't own?
July 26, 2013 1:34 PM   Subscribe

My girlfriend is continually being called by a collection agency, NCO Financial, on a student loan that we don't think they actually have the rights to collect on. How can we get them to stop attempting to do so?

The details are as follow: NCO Financial has been calling since February and asserting that she has this loan, that it has been put in collections, and that it came to the company in February. She answered their call in February but felt that something wasn't right. At the time she had a number of companies contacting her about her private student loans through Chase, so it's was entirely out of the ordinary to add another group to that list. To the best of her knowledge she took out three student loans through Chase to help pay for college (the reason why this is to the best of her knowledge is that her father passed away right around then and a lot of the paperwork seems to have been lost in the shuffle).

She called Chase to confirm about this and the other loans so that she'd know who she had to pay and for how much. They said to call their national recovery group, who would have records of any Chase loan and which collection companies should own it at the current time. Every time she calls the national recovery group (4 times now) they confirm that this company NCO is not only not on their records, but a company that Chase would never deal with for private student loan collection and is a company she should give neither money nor personal information to. It seems that NCO does have the right student loan number but that's one that the nation recovery group says belong to another agency who she has been paying now the whole time. Where they got the number isn't clear at this point, but it seems they do have some of her information already.

She's expressed this to NCO financial systems a few times, and they are adamant that they have a 15k loan that originated with Chase that needs to be paid off, and they are quite adamant that its a valid loan. The last time she talked to them, she requested the original loan document, about a month ago, and the representative on the phone said that he didn't know how long this will take but that he could put a request through, however in the meantime waiting for the original documentation could result in a further delay to her case which would represent an even worse position for her.

Now we've looked into NCO and have seen it has a pretty sordid reputation about it's business practices, but that doesn't seem to mean we can get them to stop calling. I see a few possible outcomes:

1. She actually has a yet undiscovered loan to NCO and it's somehow been lost in the shuffle between Chase and all that (worst outcome)

2. She has a current loan that NCO owns but one of the other agencies she's been dealing with has been collecting on (bad, but she's at least been paying something off, so I imagine there may be a way to apply the past payments to the loan)

3. She's totally current, they're either slimebags or incompetents who shouldn't be calling at all

Given what I've written about whats the best way to confirm which situation we're in? Additionally given that I suspect that it's option 3, what's the best way to shut these people down and get them in trouble if possible?
posted by Carillon to Work & Money (12 answers total) 6 users marked this as a favorite
She needs to pull a credit report. All three agencies are required to provide her one for free once a year.

She needs to ask them for proof in writing that they hold a note against her. They are required to present this in a short amount of time.

She should talk to a lawyer that specializes in defaults.
posted by cjorgensen at 1:38 PM on July 26, 2013

She needs to pull her credit report and see what's actually out there happening under her name and social.

Once you know what the source is for these calls (if there is one), proceed from there.
posted by phunniemee at 1:39 PM on July 26, 2013

On the credit report: go to All the advertised ones (including require a CC to sign up, then charge you a monthly fee after the first month.
posted by markslack at 1:40 PM on July 26, 2013 [2 favorites]

See this extremely useful answer from an earlier askme.
posted by rtha at 1:48 PM on July 26, 2013 [5 favorites]

A consumer who wishes to validate a debt may send a written request pursuant to Section 1692g of the Fair Debt Collection Practice Act. Many such sample form letters are online.
posted by Tanizaki at 1:48 PM on July 26, 2013 [1 favorite]

The FTC has some FAQs that look helpful for this kind of thing, or might lead you to other useful resources.
posted by jhc at 1:54 PM on July 26, 2013

As for debt collection by telephone, why engage?

Send the MOST EXCELLENT LETTER listed above, certified mail. (Get a street address not a PO Box.)

Until they send her what she wants, if she gets a phone call all she has to do is say: "I have formally requested information, in writing and I won't talk with anyone from your firm until I receive it. Please do not call me again." Then hang up.

If they persist, sue them in small claims court.
posted by Ruthless Bunny at 1:58 PM on July 26, 2013

Yeah, take a look at the FTC link above. There are a lot of laws out there that regulate how and when debt collectors can contact you, and the laws provide methods for making them stop.
posted by craven_morhead at 1:59 PM on July 26, 2013

The newish Consumer Financial Protection Bureau recently published "New ways to combat harmful debt collection practices". That guide includes five action letters you can send to collectors, including one to stop contact, and information on submitting complaints to the CFPB.
posted by JackBurden at 2:08 PM on July 26, 2013 [1 favorite]

Under the Federal Debt Collection Practices Act, a debt collection agency is required to send a debtor who challenges the validity of the debt a validation notice that, among other information, explains to the debtor how to proceed with a challenge. Has your girlfriend received such a notice?

As others have noted, send this company a letter by certified mail, return receipt requested, challenging the validity of the debt. Report this company to your state Attorney General's office and to the Federal Trade Commission if they won't stop calling (instructions at the link).
posted by sevensnowflakes at 2:41 PM on July 26, 2013 [1 favorite]

Consumerist just published "5 Sample Letters That Get Debt Collectors Out Of Your Face" and she needs to copy #1 which gives you the precise language you need to make them prove they own this debt.
posted by BlahLaLa at 3:35 PM on July 26, 2013 [3 favorites]

Until they send her what she wants, if she gets a phone call all she has to do is say: "I have formally requested information, in writing and I won't talk with anyone from your firm until I receive it. Please do not call me again." Then hang up.

If they persist, sue them in small claims court.

For the record, this is a common misconception, but you actually cannot sue a collector for harassment after verbally telling them to stop calling. You need to actually sign and mail them a physical cease and desist letter by certified mail.

As to the actual validity of the company or their claims, I have no idea.

I am a loan collector. I am not your loan collector (or a student loan collector, for that matter).
posted by celtalitha at 5:38 PM on July 26, 2013

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