(Everything EXCEPT child support, tax debts and student loans-they all have their own set of special rules!)
Here's a new take on collection that is going around now. Collectors depend on your lack of information about the law and not asking enough questions!
Please talk to a lawyer about collection problems. Every situation is different and a lawyer can tell you if you have a defense or when you may be giving up a legitimate defense to a collection action.
Are Collection agencies, collectors calling you about an OLD debt?
A debt on which you have not made a payment in at least 5 years - is old!
Scams or Fraud going on now:
If you have an "old" debt and collectors are contacting you, they may ask you to just make one payment to "make it go away." What you may not know is that making that making just one payment will "REVIVE" the debt!
Reviving the debt means that you no longer have a 'defense' to collection of an old debt in court.
Here's the deal:
"Old" debts. If you have one, the collection agency/collector can still call you. They can even sue you and take you to court. BUT you have a 'defense' to the lawsuit. The defense is that it is "old" or "stale" because the statute of limitations for collection (the time they have to sue you) may have past.
Yes, the company can still sue you. If you are sued on any debt, do NOT just ignore it and hope it will go away. It won't! Contact a lawyer for advice.
The company may get a default judgment against you and be able to take money from your bank account or require you to come to court to tell them where your assets are.
What does that mean for you?
It means that you may have passed up a 'defense' to the lawsuit by not responding to a notice of a lawsuit or court date or you might pass up the 'defense' and revive the debt for purposes of collection if you make a payment on an 'old' debt. Everything starts all over again and the judgment against you on the debt is now 'enforceable.' The judgment holder can continue with collection actions in court and have wages and bank accounts garnished.
What to do:
1- Have you made a recent payment?
If you are contacted by collectors on a debt that you have NOT made a payment on in at least 5 years contact a lawyer!
In some cases, if you have NOT made a payment in 3 years if there was no written contract, agreement or lease involved in that situation.
Get information on your specific situation.
You can only get legal advice by talking to a lawyer about your situation.
Reading legal information like this is NOT legal advice!
2- Credit report
Check your credit report at least once a year. Some credit reporting agencies may add something to your credit history on the report of a collector or someone who has 'purchased' the debt from the person to whom you originally owed money. That second person or company, may add the debt and try to 're-age' the debt. 'Re-aging' means that they are trying to make the debt appear much more recent than it actually is.
If you have trouble figuring out a debt that appears on your credit report, talk to a lawyer. Think about any old debts that you may have not paid on in a while, thinking that the creditor just stopped trying to collect the money.
3 - Debt buyers
If a company you have never heard of contacts you or sues you for an old debt, a new company may have bought that debt. Credit companies, even banks, buy and sell old debts for 'pennies on the dollar.' The new debts are bought or sold on good faith alone, with no accurate record of the account. The new owner may be unable to prove the debt is legitimate. This is another possible defense which will be up to you to raise.
4 - Guilt
Do not allow a creditor or collection agency to make you feel bad or "guilty" about the debt. Do not allow anyone to "guilt" you into making a payment. A single payment will revive the debt and start the statute of limitations over again.
5 - Talk to a lawyer first!
Do not tell the creditor or collection agency that you owe or may owe the debt. Talk to a lawyer first! Some judges may consider even saying that you owe the debt to be as good as a payment to start the statute of limitations over again.
How do I stop creditor harassment?
1 - Send a certified letter
You can send a certified letter, return receipt requested, to debt collectors and creditors, explaining any legal defenses you have or exemptions from their ability to collect on a judgment.
Keep the letter short and simple. Do not admit owing the debt.
For example, you could write:
"If I do owe this debt, it is barred by the statutes of limitations."
2 - Ask them to stop
You can ask that the creditor or collection agency stop contacting you. Debt Collections, including lawyers, must stop any further collection attempts, except if the person is the original creditor.
If they continue to contact you after you ask them to stop, they may violate the Fair Debt Collection Practices Act. They could be charged a penalty of $1,000 for each time they continue to try to collect.
You will need proof, such as the certified mail receipt to show that your letter was actually sent or received. Send the letter asking them to stop contacting you by certified mail, return receipt requested.
Understand that when a creditor or collection agency is asked to stop contacting you, sometimes they do go ahead and sue you over the debt.
The original creditor might stop contacting you if they know further efforts are useless. Talk to a lawyer to get legal advice about your situation and get help with a letter to the creditors.