What happens when an account goes to "collections"?

1

Too long a story here, but essentially two accounts claim I’m over due [I’m not] and both threatens turning over to collections.

This is new to me. I have assets but only income is SSA and RMD’s from accounts.

What does ‘collections’ do?

2

I think a lot of the path forward will be determined by whether it goes to an internal collections department, or an external (3rd party) collections company.

I don’t believe much changes if it stays internal because the debt still remains with the same company. This usually happens in bigger organizations than can staff their own dedicated department. They will probably work with you some on a payment plan or slightly discounted payoff. I know people that take this strategy with medical bills all the time. If its less than 90 days then I don’t think it hurts your credit much.

If it goes to an external collections company, it means the original payee has charged off the debt and sold it for pennies on the dollar. You are going to take a hard ht on your credit if this happens. But on a positive note you can really negotiate a discounted payoff of 50% or more.

3

Thnx. I have no intention of paying a bill, or even part pof if they won’t let me dispute it, even though I have documents. That’s my issue. I can’t find a way to contact them. I just get threatening mail.

4

Name and shame🤣

5

??? huh?

6

Being turned over to collections used to decrease credit scores. It doesn’t even do that anymore if the debt is due to medical or dental treatment.

If you don’t care about your credit score, the only thing you need to worry about is receiving a demand letter from their attorney, threatening to sue you.

7

Thanks. Makes sense.

8

If you do not own the debt and the account is writing you making a demand the Fair Debt Collection Practices Act contains the following “Ceasing Communication with Consumers
When a consumer refuses, in writing, to pay a debt
or requests that the debt collector cease further
communication, the collector must cease all further
communication, except to advise the consumer
that
• The collection effort is being stopped.”

I recommend that you send the creditor a formal letter by certified mail- return receipt requested stating that the debt is disputed and that per terms of the Fair Debt Collection Practices Act you are not to contact me further regarding this matter.

In addition to the above if you know which state they are in you can go to the Secretary of Sates Business listing and find out who their process agent is.

Since hey are doing business in you state by trying to collect a debt in your state they are very likely to be subject to the jurisdiction of your small claims court under your states Long Arm Statute.

All 50 states have Long Arm Statutes.

You could therefore use your Small Claims Court to recover dmages for the loss of your time and effort in dealing with this issue.

I am not a lawyer, have recieved no consideration of value in giving this opinion, and the value of my advice may be worth a lot less than what you have paid for it.

1 Like
9

Good to know! Many thanks