Collection Law

[chrssycats]

What is the name of your state? Georgia

My husband has a debt from NJ (Providian). Card closed by company in Sept 07. Sent to collection agency in Atlanta December07. We had a payment plan, made 2 payments and cannot make more. Our ending balance at that point was 5400.00. They(collections) at the end of March 08 offered a 3K settlement which we don't have. Now below is where all stands Here is the situation:

Can the collection agency add late charges and interest ?(as they are)
Who determines what the cc company will take as a payoff? And do we have rights to negotiate so it benefits us?
Who do we owe the money to, the cc company or the collection agency?
I have advised we have no money and cant even make small payments. They demand all get settled or they will take us to court. We own the debt and will be able to pay it off by years end. What should and can we do?
Thank you!

 

[AnotherMoron]

Can the collection agency add late charges and interest ?(as they are)

Yep, it's in the fine print of your credit agreement.

Who determines what the cc company will take as a payoff? And do we have rights to negotiate so it benefits us?

The original creditor or the collection agency, whoever owns the debt, decides what they will accept as a settlement or if they'll accept a settlement. They're not obligated to, they're entitled the entire amount including interest and penalties and, if it goes this far, court/attorney costs as well. You have the right to be grateful they're willing to work out a settlement. You can try to negotiate for anything you'd like, they're not obligated to accept your terms.

Who do we owe the money to, the cc company or the collection agency?

You owe money to whomever owns the debt. That could be the original issuing bank if they're using in-house collections. Or it could be a 3rd party if they've sold the bad debt.

I have advised we have no money and cant even make small payments. They demand all get settled or they will take us to court. We own the debt and will be able to pay it off by years end. What should and can we do?
Thank you!

Get a second job. Sell things. Borrow from relatives, whatever you have to do, but pay this debt now. 'By year's end' isn't going to be acceptable to them most likely. You want to get this paid off ASAP. The fees and interest will continue to compound until the debt is doubled, or worse. You need to pay it. A judgment will ruin your credit worthiness for at least 7-10 years, longer if you don't pay the judgment. You do not want this to go to court.

 

[chrssycats]

collection laws

Thank you for your reply.
At present I will make payments which i can afford. I know it will not stop the fees, but as long as i can make some sort of "good faith payment" until yrs. end when all monies we will get come do, I don't believe they can take me to court. They had stated they will accept it, but all interest will continue to accumulate.
If they gave me 2 offers to present when I am able with cash money in hand to broker a new deal I will see what they come up and negotiate from there.
Again I thank you for your help in this. I am a new user to this website and find it helpful!

Chrssycats

 

[ShyCat]

as long as i can make some sort of "good faith payment" until yrs. end when all monies we will get come do, I don't believe they can take me to court

That is not correct. They can sue you at any time, at their convenience and for their own reasons.

 

[TigerD]

This thread is full of factually inaccurate information. So far, Shycat is the only one that is correct and he only addressed a minor point narrowly.

1. No collection agency can add fees and interest to a debt beyond what is authorized and agreed to in the original contract.
2. The debt isn't paid until the collection agency gets paid. You have to pay the CA.
3. You advised them that you have no money? You have a phone? You have internet access? You have money. What you are lacking is a clear understanding of your priorities, something a judgment will help you with very quickly.
4. The collection agency determines the settlement amount -- within the guidelines of the contract with the original creditor depending on whether the debt was placed or sold.
5. You certainly can negotiate. But you ave to bring something to the table and that something is money. AnotherMoron rightly pointed out that the end of the year isn't acceptable.
6. The only good faith payment that can forestall a lawsuit is balance in full. Nothing else is good faith. If the CA offers you a payment plan, they are offering you a courtesy. They are not required to.

OP: You do not want this to go to court. You have already taken a hit to your credit. But that hit is fixable. Don't let it get to the judgment phase. Instead of telling the CA you won't pay them. Talk to them. Go over your budget with them. Good collectors can help, but you are going to have to answer their questions.

DC

 

[AnotherMoron]

Sorry DC, it's been over a decade since I was in the industry so my memory may be foggy.

What did I get incorrect so I don't make the same mistake again?

 

[chrssycats]

thank you all for your information.
In talks with the debt collector i will go get a loan(not something else i need) but am doing so and will settle this account next week.
A judgement was not what i or my husband want nor need, so we will make do with what we can- get one creditor paid in full , 60-90 days it shows as such and will have the loan direct debit from our account. With any luck we can refi at a lower rate 3 months down the road!

again many thanks for all this information it has made my decision to proceed easier.

 

[TigerD]

Sorry DC, it's been over a decade since I was in the industry so my memory may be foggy.

What did I get incorrect so I don't make the same mistake again?

No problem. Collectors may not add any fees not allowed in the initial contract. I may have responded a bit harshly, but that minor error plays into the deadbeat's conspiracy theories.

DC

 

[AnotherMoron]

Thanks for the correction. My wording was terrible in my answer. I actually meant what you said, but I was terribly unclear and misleading with my wording. I should know better than to respond without being fully caffeinated!