Archive for Category 'collection agencies', page 4

Question: my husband has his own business. he is in his second year of operation and this there wasn’t work. prior to this, he had a steady job, great credit rating etc, but its been a long winter.
he has a leased car which is behind in payments, insurance that hasn’t been paid, credit cards that are behind and a mortgage on a rental property in his name that is behind.
he is subsizing the rent there, as the rental amount doesn’t cover the mortgage/ fees.
he is starting to work again after 5 months of zero income but i fear the damage may be done. the phone is ringing at all times of the day/night and yesterday we came home to a bailiff’s card stuck to our door, and registered mail for pick up at the post office. i’m starting to feel sick!
I’ve been able to float our bills for the house myself. i make good money and have a great credit rating.
our house is under my name, as well as mostly everything to do with it.
what are the implications to my credit rating? what can i do? what can he do? do we have options?
what would the bailiff’s card/ regsitered mail be? would the bank take the rental property?
Help!!

Answer: First, unless you have joint debts, your husband’s credit rating is different from your credit rating.  If you own the house, and it has always been in your name, his credit problems do not impact on your house.

Having said that, this is a very serious situation.  Bailiffs are calling because they want to reposses something (a car, leased equipment); registered mail usually means a creditor wants to take you to court.

The solution is to immediately contact a financial professional, probably a bankruptcy trustee, to review your husband’s situation to determine what strategies can be used to get back on track.  If his income will pick up he may be able to save the business; if not, it may be necessary to close the business and go back to being an employee.  Either way, he needs to get financial advice immediately before the situation gets worse.

Question: How do you negotiate with a collection agency? I offered 200 over the principal balance and got laughed at by the bill collector when offer to try to pay it off in full after years of throwing away the bill then the last 6 months of regular 20 dollar payments but the interest is 514 and they wont budge? i made what i thought was reasonable and i still dont unserstand why they would rather have 2000 in 20 dollar payments forever than a reasonable lump sum that clears it up? so how does one negotiate with collection agents?

Answer: The best way to negotiate with collection agents is to do exactly what you did.  Make them a reasonable offer.  If they don’t accept it, they have a choice: They can either get nothing, or they can start court action and attempt to garnishee your wages.  In most cases they would rather get at least something.  You must be firm when dealing with collection agents.

Be aware, however, that if they do commence garnishment proceedings and you are undable to pay, you may then have no choice but to file a consumer proposal or personal bankruptcy to stop the garnishment, so be aware of the risks before you make any offers to collection agents.

Question: I recently was at my bank and through a credit check they told me I had a collections record. When I ran and Equfax report and did some research I was informed it was for an old telephone account I had in a previous province. When I re-opened an account with the same company in the new province 5 months later the system did not alert them that I had monies outstanding. I was completely unaware of the past due account as the company sent letters to the address I told them I was moving from when I closed the account. I am now trying to get copies of the old billing statements and the letters that were sent to me that I never received. I have contacted the collections agency and they said they do not have that info and I have contacted the telephone company and they said legally they do not have to provide me with the information. How can I get this information or is it unattainable? I want to know what I was being charged for and proof that effort was made to contact me. Also now that this is on my credit report, will it stay for six years since I made the payment (last week) or for six years since the account was in default (2003)? The company held on to this for three years – does my credit report have to hold onto something that happened 3 years ago plus six years on my report for a total of nine years?? Help! Thank you!!!

Answer: Once something appears on your credit report, it typically stays for six years from the date of last activity, not from when it first appeared.

To have this removed from your credit report, you will probably either need to have a lawyer threaten legal action against the telephone company or the collection agency for not providing you with proof that you owed the money.  Your other alternative would be to contact the Ministry of Consumer Affairs in your province to see if they have a procedure that you can follow to get this corrected.

Since you have now paid the item, and since it was a relatively small dollar amount, it will probably not have a significant impact on your credit report in the future.

Question: I have Credit card debts. I have no job and no money.
I can raise some money from friends/family to cover a partial settlement.

Hi, almost 5 years ago, I became ill and havent been able to work since then. Prior to that I had excellent credit history.
I started falling back on my payments and then it came to taking from one credit card to pay off another.
Two and half years ago, I just couldnt pay anything on two credit cards, same company. They sent it to collections. I first felt intimidated by the collections calls and harrassment, but I finally said to them, do what you have to or want to, I got no $ to pay you and the last payment I made to them was almost 2 years ago. Eventually they got fed up of all the calls and letters and from one collection to another, the file was passed on to and now I dont recieve anything from them. Their combined total was about 14000. One was 11000 and the other card was aobut 3000. Incidentally one of the collection agencies did try to offer me a settlement of 60%. But I declined cause i didnt have the money.
The remainning cards, I owe a total of $44500.
I have a car that I use its value is about $4000.
Now, I’ve been browsing the net and have read about debt settlement.
Im able to raise some money for it..but not alot…at the most about 15000. Do you think with this amount a Debt settlement is possible..a one time buy out?
It still shows on record for 7 years as an R7/R9.
Bankruptcy?
Please help. I cant sleep anymore.

Answer: There are a number of options.

First, you could simply continue what you have been doing, which is telling the collectors that you can’t pay.  Since you are not working, they can’t garnishee your wages.  You could change your phone number to avoid the phone calls, open a new bank account at a new bank, and let them pursue you.

Alternatively, you could offer a cash settlement to each of them.  If you owe a credit card $10,000, you could borrow from family and offer to pay them $5,000, or whatever amount you can afford.  They may accept that deal, since they can’t get money any other way from you.  If you do make a settlement, be sure you get it in writing.

Personal bankruptcy is also an option.  Family could loan you the money to pay for it (it would cost around $1,500 depending on which trustee in Canada you use) and then your debts are eliminated.

Since you are having trouble sleeping, we suggest you contact a bankruptcy trustee to arrange a free consulation to take action on this now, before the stress gets even worse.

Question: I have recently graduated from University and I am unemployed. I have collectors calling me almost on a daily basis, threatening to seize my bank account without giving me any written notice. The refuse to allow me to make payments on my debt and tell me that I have to pay the amount in full or else! What can I do?

Answer: You are unemployed, which means you have no wages, so they cannot garnishee your wages.  I suggest you open a new bank account at a new bank, since if they don’t know where your bank account is, it will be very hard to seize it.

Then, when they phone, simply tell the collection agents that you are not working, and then hang up the phone.

Once you start working you become vulnerable to having your wages garnisheed.  At that point you can attempt to make payments to them, or perhaps consider a debt management plan, a consumer proposal or personal bankruptcy.

Question: How much can a collection agency force you to pay each month…..on a fixed income of 600.00 a month (temporary) they are making me pay 200.00 a month, and call every month asking me to up my payments….I have a child to feed with that money but they don’t care….

Answer: A collection agency cannot force you to pay anything.  If you don’t pay them, they could take you to court, sue you, and attempt to garnishee your wages.  However, if your income is $600 per month, it is unlikely they will take you to court.

Obviously the calls are causing you a great deal of stress, so we strongly recommend that you contact a credit counsellor or a bankruptcy trustee to review your situation and advise you on your specific options.

Question: A secondary collection service collected funds from me for another agency, which I payed off in full as of March 2006, but last month I was going to increase my visa limit and found out that they now have another collection against me which they claim is interest. I never received any letters or calls to my place of work after the full payment in March of 2006. Who can I contact legally about this, and what are my chances. Thanks for the help.

Answer: You should start by contacting the original creditor (not the collection agency).  You should also contact both collection agencies with proof of payment.  If you are not able to resolve the matter directly with the second collection agency, it is possible that they may take legal action against you.  If they do, be prepared to bring proof to court that you paid the debt in full.  In most cases if you present the proof to the collection agency they will correct their records without the need for you to go to court.

Question: My wage is currently being garnished as a result of a civil judgement. Now the same collection agency is threatening to forclosure on my home. I currently live in Ontario. Can they do that? What are my options at this point.

Answer: In order to foreclose, the creditor will require a court order.  Since the court has already granted them a judgement, it is likely that the court will also grant them the ability to foreclose.  You have a number of options:

First, you could attempt to negotiate a settlement with the creditor, although that is difficult once a judgement is obtained, since they have little incentive to settle.

Second, you could file a proposal in an attempt to stop these proceedings.  This is a very complicated area, so you would need to seek the advice of a bankruptcy trustee or lawyer before proceeding.

Finally, if your debts are more than you can handle, and if you don’t have the money to keep fighting this court action, a personal bankruptcy may be your final option.  Again, a bankruptcy trustee can provide further details, including explaining the impact on your home.

Question: What are the rights of a consumer when a creditor has written off a 7 year old debt, then sells the bad debt to another organization similar to a credit agency ?

Answer: Once you owe a debt, the debt never goes away.  In most places in North America this is no statute of limitations on a debt.  In practice, if a creditor leaves you alone for 7 years, it is difficult for them to pursue you later, because if they went to court to try to collect a debt that old, the court may wonder why they waited so long.

However, if the creditor or the collection agency is pursuing you, you will either need to work out a plan directly with them, or file a proposal or a bankruptcy, or work with a credit counselor, to deal with the debt.

Question: I have large credit card debt I am behind 3 months what is the differnce of paying it to the card company or to ther collection agency? If one is worse than the other why? And the long term effects like my credit score?

Answer: Your credit report shows your payment history, so if you are three months behind, you would normally be rated as an R4 (R1 means you are up to date; 3 months behind is an R4).  Therefore whether you pay the credit card company or the collection agency typically does not matter; you are still an R4.

In some cases the credit card company will not accept your payment; once they turn it over to a collection agency, only the collection agency will accept payment.

If collection agents are calling and if you don’t have the money to pay them, it may be time to deal with the problem once and for all, perhaps by filing a consumer proposal.