Debt Lawfirm changed companies

[lyonrt]

What is the name of your state (only U.S. law)?
South Carolina

Ok so we were stupid a few years ago and had some debt. Debt collector sent us to their lawyers and we ended up settling on a monthly repayment schedule.

They just sold the debt to a different law firm. We have not missed a payment and have been very communicative with the previous lawyer.

Just received letter in mail that the new firm is suing us for entire amount again!

I have the original agreement and payment schedule the first law firm agreed to and we were paying. What are my rights? What are key things to say when we get on the phone tomorrow with the new firm? This is frustrating :-(

Thanks,

Tyler

 

[FlyingRon]

Did you send a copy of the prior agreement to the new firm?

Your rights if they persist is to show the modified agreement in court when they sue you.

 

[dcatz]

Would like to know more about the agreement and what balance remains, but was primarily interested to determine that So. Carolina gave cognizance to equitable remedies and it does.

Nobody here can tell you what to say. I assume you are still performing timely on the written agreement. If that’s not true, just disregard this post. I suspect a “problem solver for all concerned” approach would be better-received and be more “warm and fuzzy” than the approach that I might choose personally.

Before firm #2 files suit and vitiates the agreement that firm #1 was authorized to make and did make, resulting in you in good faith altering your position (for how long a period of time?). I would Google “equitable estopple” and throw in judicial estopple for good measure. Doing that should get you the USSC’s required 4 elements for equitable estopple. See if they apply to your situation. Understand the thought process taken to avoid inequity to position yourself for the call

I would let both firms know what is going on beforehand and ensure each knows the other knows. (Invite a conference call?) I would also ensure that firm #2 understands that you are prepared to continue performing the present agreement to completion “despite the present hardship”. At that point, I doubt they care enough to wonder what hardship but now think you are already experiencing some.

 

[Jeran]

What is the name of your state (only U.S. law)?
South Carolina

Ok so we were stupid a few years ago and had some debt. Debt collector sent us to their lawyers and we ended up settling on a monthly repayment schedule.

They just sold the debt to a different law firm. We have not missed a payment and have been very communicative with the previous lawyer.

Just received letter in mail that the new firm is suing us for entire amount again!

I have the original agreement and payment schedule the first law firm agreed to and we were paying. What are my rights? What are key things to say when we get on the phone tomorrow with the new firm? This is frustrating :-(

Thanks,

Tyler

Unfortunately, this is all too typical when dealing with debt collectors and trying to voluntarily pay them anything. They take the payments but sometimes they don't apply it to the balance. They may have applied it to interest charges or other fees. Then they turn around and sell off the principal balance to a new junk debt buyer who then files suit for the whole amount as if the settlement agreement never existed.

In some cases, when a debtor makes monthly payments to a debt collector, the debt collectors see them as "low hanging fruit" or a "pushover" because they see that you are willing and able to make agreements with them and to make payments to them. Sometimes they threaten file a lawsuit as a way to motivate you to pay them more each month.

Contrast that to someone like me who made it so difficult for them to collect any money from me that my debts ended up going uncollected until the Arizona statute of limitations passed on them. There is light at the end of the tunnel. I no longer even get any phone calls or letters from them. They have given up trying to collect anything from me. And for good reason. They know they will never get a penny of it from me.

You didn't give us a lot of information here to work with. Did you get the settlement agreement in writing? This is why you must always get a settlement agreement in writing before paying them anything.

If you have it in writing, send a copy of the settlement agreement plus copies of the cancelled checks showing you made all the agreed upon payments on time to the new debt collector by certified mail.

If they do sue you, bring that information plus the certified mail receipt with you to court and show it to the judge.

This also illustrates why, if you out there in the reading audience, are thinking about settling your debts, it is often better to do one lump sum settlement payment rather than monthly payments. And it shows why it is important to get it in writing that the debt is "settled in full" for that one lump sum settlement payment, and that the junk debt buyer (or original creditor if it is still in the hands of the OC) agrees to not sell the remaining balance to anyone. They will send you a 1099-C and you may have to pay taxes on it, but see I.R.S. form 982 for more information about that.

 

[Zigner]

Contrast that to someone like me who made it so difficult for them to collect any money from me that my debts ended up going uncollected until the Arizona statute of limitations passed on them. There is light at the end of the tunnel. I no longer even get any phone calls or letters from them. They have given up trying to collect anything from me. And for good reason. They know they will never get a penny of it from me.

I find it pretty darn disgusting that you are so proud of your status as a deadbeat.

 

[Jeran]

I find it pretty darn disgusting that you are so proud of your status as a deadbeat.

And you don't find the many nightmare scenarios and abuses from the debt collection industry disgusting at all.

I encourage anyone reading this to simply do an internet search of FTC vs. Asset Acceptance to see how our federal government feels about some of these recent and ongoing abuses from the debt collection industry.

 

[quincy]

... I encourage anyone reading this to simply do an internet search of FTC vs. Asset Acceptance to see how our federal government feels about some of these recent and ongoing abuses from the debt collection industry.

Following is a link to information on the FTC v Asset Acceptance, LLC settlement that Jeran references above:

http://www.ftc.gov/enforcement/cases-and-proceedings/cases/2012/01/asset-acceptance-llc-united-states-america