Mistakes You Can't Afford to Make with a Debt Collector
By Daniel Sater CCE, Certified FICO Professional
Avoid these mistakes when dealing with a debt collector. Here is what you need to know:
#1 Mistake: Giving a debt collector your banking or credit card information.
If you tell a collector to take $75 per month out of your account and at some point in the future they empty your account, you’re screwed. Why? Because the collector is going to say you gave them permission and it becomes at best a “he says, she says” type of situation. Any attorney will tell you you don’t have much of a case against them. NEVER give a collector you credit card or bank information. Send a money order instead. Best to get the money order from a bank you don’t use.
Never do Check-by-Phone or Western Union
#2 Mistake: Sending money to a debt collector without getting paperwork FIRST,
showing who they are, what you owe, how they arrived at that figure, who the original creditor and what was the original amount. It also pays to ask if they were assigned the debt or if the bought the debt. (Ask for papers showing their authority to collect for the creditor).
Don’t let them intimidate you. You have what they want – the money. Believe me, it’s all about the money and getting it as soon as possible. You have the upper hand; ask for them to prove the facts. If they cross the line you can threaten them with a lawsuit, and that you will notify the BBB, their States Attorney General and the Federal Trade Commission FTC.
#3 Mistake: Not showing up in court, or answering a court suit, when served.
If you don’t appear, you automatically receive a default judgment. It goes on your record for seven years as a judgment. It will continue to accrue interest and depending on your state can follow you for ten years and possibly be renewed for an additional ten years. Many attorneys file a suit in court because they know you likely will not show up (90% don’t show), so it’s an easy payday for them, they've done their part by submitting the paperwork. The judge thinks, the consumer doesn't care, why should I? He’ll even add on court cost.
NEVER ignore a lawsuit; we can help you with referrals to local consumer law professionals. Don’t tell me you can’t afford a lawyer, you have no idea how easy it is to hire one. It can be a lot more expensive not to.
REMEMBER, even if the Statues of Limitation has expired barring them from getting a judgment, if you don’t show up, the Judge won’t question how old the account is and issue a judgment. Once the judgment is on your record, it can be enforced. You must be there to claim an affirmative defense regarding the Statutes of Limitation or you lose.
#4 Mistake: Signing an agreement or legal document without consulting with an attorney.
Don't do it, even if you are threatened. Again, get in touch with us; you have options, let’s discuss them.
#5 Mistake: Failure to dispute the validity of the debt and dispute any credit bureau reporting. These are important steps in protecting your rights, invoking the federal laws that protect you and making these bottom feeders back up their claims. We can offer you Dispute Validation Forms, credit disputing tips and access to the brightest consumer law professionals in the country. Debt collectors have to abide by the law, make them realize you know your rights, make them work for it.
#6 Mistake: Document everything, phone call times and dates and who called. Request that all communication is done in writing.
It can take most of the possibility of intimidation and threats out of the conversation. It’s the best way to keep a record of conversation.
#7 Mistake: Thinking paying off a debt will automatically remove it from your credit report.
All you will have is a paid collection, that is paid. You will avoid al lawsuit, and, your file being sold to yet another collector who will hound you for money.
If you request that payment will have them remove the item reported, get the agreement in writing FIRST.
At Credit Scoring Advisor, we are the Experts. We have helped thousands of clients reach the goal of buying a home, a new card or just be able to get credit cards for everyday use.
Daniel Sater has trained and coached numerous Credit Repair Companies across the country to have a better understanding of how the FICO scoring model works and how to get the best results in repairing their client’s credit. We are proud members of NACSO the Credit Repair Industry’s Trade Association.
If you need help improving your credit, give us a call at 631-392-8685 – you’ll be glad you did. We provide rapid, personalized credit repair – you will be working directly with a Nationally Recognized Credit Expert.