MRSI - old debt, but creditor on paperwork isn't original creditor

[SolaireSolstice]

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

Nine years ago, during a period of personal and financial hardship (not important, I know I was wrong), I defaulted on 5 credit cards, all of the ones I had at that time. I did receive advice from CCCS, who explained that I couldn't be put in jail, they could file suit, and they could seize my bank accounts. I was prepared to face this if it came, and it never did.

It took me several years to put myself back together and begin making a wage that could support myself and child, by myself, with no outside help. In the meantime, these credit cards went into collection and were sold repeatedly. I know who the original creditors were, the original amounts, and have been keeping track of the sale of the debt as best as I can. Some of them changed hands without ever attempting to collect the debt, so I may not have the names of some of those collection agencies in between.

I have never had suit filed against me for these debts. I have never moved out of Texas. I know the statute of limitations is way past (4 years in Texas, from date of default (+6 months?) on original creditor is the way I understand it.) From the date I went into default, I made one payment to one card in late 2001, but not another payment since then on any of these debts. I cannot prove a negative (meaning I cannot prove I have NOT made a payment) but I do have all my bank statements for the past 10 years, and I will use these and the letters from each creditor showing lack of payment.

I have begin receiving calls, and have finally received the paperwork, from MRSI, Maximum Recovery Solutions, Inc, a collection agency out of Houston. They use, accoring to various web reports, some pretty sleasy but maybe not actually illegal tactics. They are theatening to file suit, which I understand is within their rights to do so and I am prepared to answer the suit if they ever actually file, which they haven't yet. And I have been checking monthly. They obviously have my current address, but knowing that sometimes they attempt service at old addresses (although I have always filed a change of address, I have moved 2 x since default, within the county and state) I have simply been checking through the civil court filings in the county I have lived since default.

The paperwork this company has sent me states "Creditor: Accelerated Financial Solutions". This is NOT the name of any original creditor on my defaulted credit accounts, and it is not the name of any company that I am aware of having attempted to collect the debt on those accounts. I'm assuming (as dangerous as that may be) that this creditor bought the debt some time back, realized it was out of SOL, and sold it again without ever attempting collection. The amount is different from the amount on any credit account as well, but I know they add interest and fees. I can narrow it down to 3 of the original credit accounts. Unless somewhere along the way one subtracted money I owed for some unknown reason.

The way I understand it, the original creditor and date of default is what is used to decide the SOL. This company, MRSI, is using a collection account from past that date and listing it as the original creditor, probably to re-age the account.

I KNOW I owe the money. I will never NOT owe the money until I pay it back. However, I also know that since the companies failed to file suit within SOL, it's past the time that it can be reported on my credit report (and I have made sure that any accounts reported since the 7 years are disputed and all have been removed) their bluster is just bluster. They can file suit, and I can and will respond with my affirmative defense.

My questions:
How do I respond now that I have finally received the paperwork and it does not agree with my own records? I have already sent the "show me the info" letter and this is what they sent. Since this is ALL they have to, within law, send, what do I say? I'm thinking a cease and desist letter coupled with: "You don't have the original creditor correct, your amount is wrong, and the statute of limitations on original debt it way outside SOL" ????? I'm looking for them to either put up or shut up, but I want them to be aware that I am aware of my rights.
Am I correct that the original creditor date of default is the one that sets the SOL, and this middle collection account cannot be used to re-age the account?

Thanks for your time. I'm sorry for the length, I'm trying to make sure you have the info you need, and that you know how much I know. I'll put my flame retardant suit on now. You cannot beat me up any worse than I have beat myself up about this. I have endured creditors calling relatives (and releasing information about my indebtedness) and survived that humiliation, so I am prepared to face the humiliation I may receive here as well.

[Country Living]

Turn on your PM.

[SolaireSolstice]

Done. 10char

[SolaireSolstice]

Thanks for your assistance Country Living. I'm responding to a couple of things here so that other people who may need assistance, or who need the information to help me will know as well.

Yes, I have pulled my credit report every year since the free credit report thing went into effect. As I said in my OP, I have been keeping a very careful eye on this. There has been a couple of instances where a couple of creditors re-aged the account and I was able to dispute the listing on my credit report and have it removed.

Funny weird, not funny ha ha, I actually have very good credit right now.

I don't believe me having had correspondence with MRSI effects my ability to now send the "cease and desist" letter. Aside from their threatening me with court action on the phone, and finally this letter responding to my request for information, the "correspondence" hasn't been very fruitful. My understanding is even if I acknowledge the debt as mine, it doesn't affect the SOL. Someone please correct me if I'm wrong. However, I have not acknowledged this debt, I have simply requested, in writing, whatever information they have about this debt. When they get all threatening on the phone, I just hang up on them after telling them I am waiting for their response to my request for information.

I am still looking for an answer on whether this middle creditor being listed resets the SOL, or is this an instance of re-aging the account that I can dispute? Is it even worth pointing this out to MRSI?

I do plan on paying off a settlement amount with whichever company(s) is lucky enough to be holding the outstanding accounts once I have saved up enough. I'm anticipating about 5 years I'll be able to do this with every one, one a year. Then I will have a clean conscience.

[Country Living]

I was waiting for some of the senior attorneys/debt collectors to come along and answer your question.

A debt collector cannot re-age the debt to the date they received it. The clock on the SOL starts at the original default (kind of iffy here - I believe it's when the debt went into default with the original creditor - maybe 30 days after the last payment????) assuming you have not made any payments to the OC or a DC since then.

I need to add a word of caution on some of the debt collectors. The relative I told you about received a "pre-approved credit card" in the mail and in the fine print it said it was a collection notice and the amount of the debt would be added to the credit card. He wouldn't have known it had he not taken the time to read everything in the offer. I think it was Midland who did that.

Scrutinize everything you get in the mail to make sure it's not a collection notice. If it is, make a copy of it and send it with the letter I sent you.

And, no, this doesn't go away. They will keep selling your debt and you'll have to send the letter each time. This is why a binder to keep track of things is convenient.

[cosine]

There is a tactic going around that you need to be aware of. This tactic involves attempting to collect a debt, and even suing to collect a debt, when the party taking the action is neither the original creditor not an assignee of the claimed debt. I suppose it is possible this activity is going on with obscure debts (cannot determine the original creditor). I have been seeing it going on with correctly identified original creditors. These scammers sue in an attempt to improve the debt, or even create one from nothing more than information, that they can then sell to other collectors at a profit instead of at a loss. The lawsuit is only done to get a default judgment. If challenged, they will generally dismiss the lawsuit, or make explanations such as loss of records.

One big problem is these tactics don't really look much different than legitimate debt collection. People need to be very prudent in dealing with any and all debt collectors, even if they know they owe money to the named original creditor. A failure to be prudent could result in paying a collector that is not the assignee of the debt AND having the true original creditor or a true assignee coming to collect the debt for real (and you having to pay again). Just because you paid money to someone else that claimed to have the debt, this does not absolve you of the real debt.

In some cases I suspect the scammers actually have access to buy the debts and become assignees, but have otherwise obtained the information about the debt enough to sue. Then if they manage to acquire a default judgment and determine the account is still worth collecting on (e.g. debtor does not declare bankruptcy), they will go back and actually buy the debt account (without informing the seller of their activity so they get it at junk debt discount rates). They may not be doing this on a per-debt basis, but on a portfolio (many accounts) basis. This could taking place on both in-SOL (probably near-SOL) and out-of-SOL debts.

In other cases the scammers may not have any access to buy the debts. The debts they refer to may be real (but they are not the assignee) or fictional (no such debt ever existed). In either case, if you fail to respond to the court, a default judgment is generally entered. Likewise if you respond, but fail to appear at the scheduled hearing (and especially if the plaintiff does appear), a default judgment is generally entered. If service was properly done, it is next to impossible to vacate these orders and the scammers have won (short of declaring bankruptcy ... but then you lose).

I could go on and on about how things are screwed up and what needs to be done to fix this. But that's beyond advice in a particular case. My advice is to be totally prudent in every aspect of the debt. Do not assume whatsoever that any claimed debt is being collected by a true assignee of a debt until that is shown (proven) to be the case with the proper documentation. This documentation needs to be strong enough that should the original credit later come to collect, it will prove that they are no longer eligible to collect. If it isn't that strong of proof, then don't accept it as proof (if they even offer such proof).

Always deal with any collectors in writing, unless you are in a "one party recording consent" state and can record telephone calls and legally use them in court. Even then, I still advise dealing only in writing. Always tell any collector that you will not believe that they are a true assignee of the debt until they provide proof of standing to collect. If the original creditor is identified and it is one you once owed money to, contact them to see if they sold the debt (or placed it for collection). If they did, make sure the information matches. If they did not, you have the opportunity to make arrangements to pay the original debt. Never pay the collector unless you are 100% sure they are the true assignee AND you have proof of that in hand so the debt cannot be double collected. And, of course, keep records of all this forever.

[SolaireSolstice]

So my choices seem to be:

Cease and desist letter

OR

Dispute the debt and ask for validation

I've been leaning toward disputing the debt anyway, because of the incorrect original creditor information they provided. Based on the information Cosine just provided, I'm leaning toward that even more heavily, because they should have to validate their ability to even collect this debt. I can always send the cease and desist later.

[SolaireSolstice]

Oh and thanks for the additional information cosine. You and Country Living have been very helpful.

I will be sure to check the validity of collection agencies' proof of standing to collect before I agree to pay any settlement.

[Country Living]

In my relative's case - he didn't bother with a validation letter since the debt was out of the SOL. He simply sent a cease and desist letter and he never heard from them again. When the debt was sold, he sent the new DC a C&D letter.

Time, penalties, and fees will add a significant amount to the original debt. Don't make any statements that you'll eventually pay them. Your future circumstances may make that impossible.

[debtcollector`]

OP - Just send a cease and desist letter. Don't get fancy, simple works best.

DC

[Country Living]

Originally Posted by debtcollector`

OP - Just send a cease and desist letter. Don't get fancy, simple works best.

DC

There you are! I was "patiently" waiting for you to come on board and give him an answer from your perspective.

[SolaireSolstice]

K. Thanks!