Collection Agencies
So, about a year and a half ago I enrolled with a credit card consolidation company in order to get out of debt. All of the credit card companies have been great, except for one. One of them has been less than flexible amd refused to work with me regarding the repayment date. Very long story short, this credit card company has now sent me to a collections agency over $120 and will no longer speak to me. I have to go through the collections agency.
So, I called the collection agency today and they told me I have to pay the full amount ($1500) by Friday. I was making $40/month payments previously and I'm currently unemployed. The guy told me that if I don't pay them in full that my credit rating, which is actually pretty good, will show like I've declared bankruptcy. I have no way to pay this amount any time soon. I'd have to continue smaller monthly payments.
Has anyone dealt with this before? Or does anyone know how this all works? Thanks for any info you can share.
Collection agencies have been known to lie. From what this says, you can write to the collection agency and ask that they stop calling you and only communicate to you in writing. They might be less likely to mislead you then.
Fair Debt Collection Practices Act
They didn't actually call me at all - I got a letter from them today and called immediately to find out what was going on. I also got the letter today from the credit card company. Evidently my account was sent to the collections agency last Monday.
I'm just so frustrated - I tried to do the right thing by signing up with the credit card consolidation company - this one damn credit card company has been shitty the entire time. It wasn't like I was trying to get out of paying them, you know??
Thanks for the info hh - I'll check it out and see what I can find.
Hey Jewel!
*Blerg* collection agencies totally suck and they do lie or try to use scare tactics to get you to pay so that they can earn their chunk of the changes--total douch bags!!! And if you owe $120 why are they saying you have to pay $1500?? That doesn't make sense at all! *grrr* I'm so sorry I don't have any useful advice for you--but I will be angry and pissed off for you while sending you thoughts of hugs and flowers and unicorns and money trees!!!! :)>>>
I listen to the Dave Ramsey podcast a lot, and the question you have sounds very similar to many he's gotten from others on air. From what he's told others like you on his show, they are just using scare tactics on you. Don't panic and check out some of the questions that have been asked that are very similar to yours on his website:
http://www.daveramsey.com/etc/cms/index.cfm?intContentID=6557
He is a fantastic resource, I highly recommend his podcast and money philosphy. Good luck, you'll get through this!
Cappie - the credit card company refused to change my payment date, so although I paid the required amount every month, they claimed my payment was late and then added interest. I paid off the late payment every few months, but evidently it wasn't good enough for them. So, the overall balance was $1500, but according to them, I was $120 overdue - I truly hate this company!
Thank you LMT, Dave Ramsey is very helpful! I am just going to continue sending the $40/month payment and the collections agency can just deal with it until I start getting a paycheck.
This is really all my fault - I wish I wouldn't have spent so much damn money on credit cards starting when I was in college :P
I was unemlployed for a while and had to go to the hospital and accrued about $3,000 in debt of what I couldn't pay up front (this on top of my student loans!). I haven't paid them anything in almost a year and they keep telling me that my credit will be F'd and they'll call an attorney, and this and that.... I got my credit checked the other day by a realtor... and guess what... PERFECT CREDIT.
I think they're bluffing... at least for a little while. Most collections will let you do payments as well.
I've worked in the mortgage biz before and I wouldn't really worry too much about this one thing. From what I remember your credit most likely has suffered some from using a credit agency (some would report they were working with you to the credit reporting agencies and mortgage companies don't like that) so one more thing like this most likely won't do too much damage. Plus, depending on how it shows up on your credit in the future your credit could improve and you could still have it showing outstanding. Granted this was back when the money was given away to people who didn't even have the salaries to afford the homes they were buying, but some outstanding credit balances like this ($120) would be overlooked if your score was high enough.
Are you still working with the credit agency? If so, I would ask them about the laws, and if they could step in with the collection agency to meditate the situation. My other suggestion would be to wait a couple of mths and then get a credit report with credit scores. Pay for it though, don't get the credit protection things for the free report. They are just ways of the company to make lots of money and not really helpful.
Good Luck, don't worry, you can only do what you can do.
First off, they're absolutely using scare tactics. I've been through it all, and I've learned what's true and what's not. It will NOT show like a bankruptcy. They will scream and holler and tell you that they're going to ruin your credit. It will damage your credit, but it's important to pay what you can afford, and call it a day.
Dave Ramsey is an amazing person to get into, and I highly recommend you read The Total Money Makeover. It will help explain the process to you. But don't worry, it's not going to look like a bankruptcy. :) Good luck!