How To Tell Debt Collectors To Pound Sand On Old Foreclosure Debt And Collection Accounts

I have a love/hate relationship with debt collectors.  I hate that they even exist because I believe for the most part the industry is legally allowed to attempt to collect money that doesn't belong to them.  They get away with lying, filing bogus lawsuits, twisting the truth, unfair practices, deceptive practices, you name it, they do it.  The love part of the relationship is that I just love, love, love beating them at their game.  You see, when you know the facts and laws to beat them down, it is a real pleasure to make them go away.

Every now and then I read an article about some outrageous scheme debt collectors employ on consumers.  The latest one is going after former homeowners who lost their houses to foreclosure. Since at least last year, they have stepped up going after the deficiencies left over after foreclosure. These homeowners have already walked away from an insane mortgage situation or lost everything and have spent the last few years trying to rebuild their credit and get back on their feet. Now, in swoop the vulture debt collectors to knock them down again and take what doesn't belong to them. Well I'm here and I am so ready to go after them and help those of you who have them climbing down your backs.

Now, this will apply to debt collection firms going after the foreclosure deficiencies but also those that are hounding consumers with bad credit card debt as well.  The reason they are called debt collectors and not creditors, is because they are 3rd party collectors. This means that they are not an original party to any transaction. They buy bad debt. That mere fact means that they have no contract with you and you don't owe them squat.

It is very important that as soon as you receive a notice from them, you need to respond.  You see, they have to comply with the FDCPA - the Fair Debt Collection Practices Act.  The have to send you that notice within 5 days of initiating collection activity and the notice has to have certain language in it that advises you of your rights to dispute the alleged debt.   Exercising your right to dispute and demand validation is what will start the process of backing them off. If they don't comply, you get to sue them.  

For the most part, they are going to respond to you and tell you a little bit about the history with the alleged original creditor and then how much the deficiency is and now you owe them. Listen real good now everyone. Some paper with their supposed facts and claims of accuracy is NOT validation. It is NOT proof you owe them. I don't care if they send you a copy of every single bill from origination to foreclosure and then some.  Its not validation. Even if they send you a copy of your promissory note with your signature on it, that is NOT validation!

Validation is proof you owe THEM!  Have you ever contracted with that 3rd party debt collector and agreed to do business with them?  Did they ever contribute something of value to you in exchange for your money?  What they are trying to collect on is a contract that was void from the get go and a contract that was discharged as a defective mortgage, which eliminates the debt. They are trying to collect on a loan that was paid off by insurance, sometimes several insurance policies so the alleged original lender was made whole a long time ago, and maybe they collected on the PMI/MIP, and don't forget the FDIC which kicked in a lot of money that put more money back in the pockets of the alleged note owner than they paid for it.

Validation includes proof that they own the alleged account and/or are authorized to collect on the alleged debt.  It includes a contract that bears your signature agreeing to do business with them specifically. It includes the documents that prove every single aspect of the alleged debt is legitimate.  If they ever produce a contract naming them and you, can they prove it is a valid contract?  A valid contract has no less than 4 essential elements. An offer, acceptance of the offer, mutuality which means equal risk for both parties, and a meeting of the minds, which means full disclosure.  I can pretty much guarantee you that even the original contract was lacking the last two essential elements.  They would need to prove value contributed that was at risk and full disclosure, neither of which an original bankster lender can prove nor can a 3rd party debt collector.  You can't prove what doesn't exist.

So start with validation, then respond to their claim of validation. Start slapping down everything they have claimed by telling them you refuse to accept what they have failed to prove.  If they haven't even bothered to try to send you any documentation, all they have then sent you is hearsay.  Hearsay is not admissible in court and its not admissible as validation. Hearsay case law has the courts calling it incompetent and so should you.

Another thing that you need to be on your toes about is the Statute of Limitations.  Every state has their own number of years for the alleged debt to be "actionable" detailed in their Statute of Limitations for debt.  "Actionable" means they can bring a lawsuit against you. This applies to all debt whether credit cards, loans, open contracts or  written contracts. Mortgage loans fall under the Statute of Limitations for Written Contracts.  The statute doesn't start running from the date of the foreclosure (or in the case of credit cards, the date of charge off). It runs from the Date of Last Payment. If you were able to drag out your  foreclosure for 2 years, and you're in a non-judicial state, look up your state's statute for written contracts and start counting the years.  I bet you're getting close.  If you're in a judicial foreclosure state, unfortunately, they got a judgment.  In these types of cases, you need to look up the statute of limitations for judgments. 

Do you want to hear some good news? If you had a judicial foreclosure and the alleged lender or pretender lender got a judgment against you, which also gave them a deficiency judgment against you, most likely, the scumbags that are coming after you are not the party that got the deficiency judgment. Most likely they are 3rd party collectors that are not mentioned ANYWHERE on the deficiency judgment.  3rd party debt collectors buy bad debt, including deficiency judgments.  So, even though they will claim you have to pay the judgment amount plus interest and fees, you don't have to pay them!! If they want to make you pay, then they will need to validate the debt, and a copy of a judgment is evidence of a debt but not evidence that it is owed to them!

So, let's start fighting these debt collectors, my friends. Don't just let them take your money. Don't just let them screw up your credit. Make them prove it and while you're at it, track their FDCPA and FCRA violations.  Those are leverage!  Fight back, demand validation. Demand proof. Accept nothing less than the full proof.  Until they prove it, (which legally they can't), they have to cease all collection activity.  That's how you make them pound sand.   It doesn't happen overnight. It takes consistency. It takes determination. It takes smashing the law in their face over and over and over again. But it's worth it. Oh yes, it is worth it. It is such a wonderful feeling when you beat them and send them packing.

More good news. I want to help people who are hounded by debt collectors. So, my partner and I have decided to offer a Christmas Special.  If you would like us to help you fight to get rid of collections by debt collectors, and of course other items on your credit report that shouldn't be there, we would love to do so.  We will discount $100 or $200 or $300 off the amount of the cost of our services. Our prices are based off the number of derogatory accounts to go after, so I can't quote actual prices here. This special is targeted for collection accounts so if you have at least FOUR 3rd party collectors furnishing their lies on your credit reports, you qualify for our Christmas Special.  

We are running this special for 2 weeks. From now until the last day of this year, December 31, 2014, if you contact us, let us audit your reports, have your consultation, and decide to use our services, you can save quite a bit of money.  So contact me right away. My email address and phone number are up at the top of this blog, on the right hand side. I'll need copies of your credit reports from the 3 major bureaus to get started so get those together as soon as you can.  Let us help you have a MERRY CHRISTMAS and a Fresh Start in the New Year!

If you have found this blog helpful to you, please consider donating as a sign of your appreciation for information I have freely given to you.  The "Donate" button is on the right side bar.  Thank you for your generosity.

Why You Can Remove Liens, Judgments And BK's From Your Credit Report

It is always so frustrating when you are trying to build, re-establish your credit or get financing and you keep getting turned down because your credit doesn't meet the criteria needed.  I think one of the most frustrating things is when you go to buy a house and you find out that you have a judgment on your credit, many times that you had no idea was even there.

Sure, you expect to see that bankruptcy, but sometimes you aren't even aware that you have tax liens and judgments on your credit.  It feels like you're doomed and will never get that loan. Its frustrating because if you spend money on paying them off, you're cutting into the money you need for your down payment and closing costs.  And if its a bankruptcy that's killing your score, you can't even pay to resolve that.

But what if I told you that you can legally remove them?  Would that make a difference?  I hope so because I'm telling you, you really can LEGALLY remove them. In fact, I'll go so far as to say that they are ILLEGALLY being reported on your credit report. The bureaus have  a responsibility and a duty to remove them. But you have to know the game in order to beat them.

I want to be clear that just because you remove them from your credit reports does not mean that they are also deleted from the public records.  The credit bureaus and the county records are two completely separate entities. Your bankruptcy will still be recorded in the public records and you can't remove it from there. Judgments and liens will still be recorded in the public records but those are things you can actually remove from public records as well as your credit reports.  I'm not going into that today.

I've been very, very successful removing these from both the public records and credit reports. This is because my idea of a fun night, is one spent reading laws and case law and researching and developing strategies to tackle these issues successfully.  I'll tell you that it's way faster and a bit easier to remove them from credit reports than public records. 

So today, I'm going to teach you why you can legally get them off your credit reports and why I believe the law is clear that bureaus need to remove them.  If you've read my earlier posts about 3rd party collectors and removing collections, you'll see that its the same laws that affect the public record information that shows up on your credit reports. These same laws are part of what I use to remove them from credit reports.

When you look at your credit report, it tells you the name of the furnisher of the information. That may be a credit card company, auto lender, mortgage lender and sometimes collectors. When you look at the public records, you'll see that they claim it is the bankruptcy court or the superior court or the county recorder. Sometimes it says a magistrate or recorder of deeds. Whatever place it shows, they are saying that that court house or recorder, or whatever, is furnishing the information.

That's a bold faced lie.  Then the bureaus go so far as to claim that they have verified the information when you send them a letter disputing the information. That's an even bigger, fatter lie. Do you actually think that the courts have hired people to furnish details about the hundreds or thousands of cases and about the losing party, to the credit bureaus? Do you think courts and county recorders have time to verify the thousands of disputes bureaus get every day? That's just one issue.

The big issue is, do they have the legal right to furnish or verify information?  Ahh, now that's where we look to the law and that's where we find the answer that the bureaus don't want you to know!  Before we even look at the law though, let's look at the legal definition of "verify" or "verification."  Now, I did a post on this word a while back. Its really important that you understand this definition.  Its part of the, um, I can't think of the word I want but , sort of the strategy of what ties everything together. Let me take a bit of that post from last year and show you here how it ties things together.

Verification according to Black's Law Dictionary is "... averment that the party pleading is ready to establish the truth of what he has set forth." Also, it goes on to say, "The examination of a writing for the purpose of ascertaining its truth; or a certificate or affidavit that it is true." 

The court said "Confirmation of the correctness, truth, or authenticity of a pleading, account, or other paper, by an affidavit, oath, or deposition." McDonald v. Rosengarten, 134 111. 126, 25 N. E. ; and Summerfield v. Phoenix Assur. Co. (C. C-) 65 Fed. 296; and Patterson v. Brooklyn, 6 App. Div. 127, 40 N.Y. Supp. 581.

To break it down into language you can understand, verification is sworn testimony. It can be testimony in a deposition or in court or an affidavit. The only testimony that is admissible is testimony from a witness with First Hand knowledge. A court clerk does not have first hand knowledge nor does the county recorder, nor does anyone at the credit bureaus, nor does Lexis Nexis, the main public records source for the credit bureaus.  If someone verifies but they don't have first hand knowledge, then its not verification, its Hearsay. And hearsay is inadmissible and the court says its incompetent. 

This is a major puzzle piece in figuring out how to go at the bureaus and get your public records removed.  The next major piece is based upon a law that applies to 3rd party collectors.  This has been discussed in a previous post as well. The law I'm referring to is FCRA § 603(o)(5)(A)(i; iii). This law in fact, applies to more than just 3rd party collectors. It applies to every single entity that furnishes information to the credit bureaus.  Here's what this law says:

FCRA § 603 
(o) Excluded communications. A communication is described in this subsection if it is a communication 
(5) with respect to which 
(A) the consumer who is the subject of the communication 
(i) consents orally or in writing to the nature and scope of the communication, before the collection of any information for the purpose of making the communication;
(iii) in the case of consent under clause (i) or (ii) given orally, is provided written confirmation of that consent by the person making the communication, not later than 3 business days after the receipt of the consent by that person;

So, even if the courts or recorder's office was furnishing the information, other than getting a court order to furnish the information, they are not allowed to furnish or verify squat on your credit report without your authorization. If you have one of these public records on your credit, did you give the bk trustee your authorization to furnish information about your bankruptcy? (not that he/she would have the time to do that). Did you authorize Lexis Nexis? The courts? The county recorder's office? Anybody?  Did you authorize anyone to put negative public record information on your credit reports?

Yeah, I doubt you authorized anyone to furnish that information and I doubt there was ever a court order to have it on there either.  Hopefully now you'll believe me, or at the very least, understand why I say that you can legally remove these items from your credit reports and why I believe they are illegally being furnished and verified when you try to get them off.

I'm not one to brag, but I have to say here that I am extremely good at what I do. I'm not saying that I get everything off in one shot, and actually, removing public records is a multi-step process. But, I'm saying that I consistently and successfully remove these items from people's credit reports all the time.  I can't remember when I haven't been able to remove them. The power to do this is in the laws, in the definitions, and in the way you word things, and the way you follow up everything with enforcement. 

Hopefully I've given you enough information that if you choose to pursue the removal of these items on your own, you too will see success.  But, if you want someone to help you that has a proven track record, almost 3 decades of experience, I would like it if you'd get a hold of me. My contact information is up at the top right hand side of this page. 

These days, prospective home buyers have a hard enough time getting qualified for a loan with decent credit, you can imagine the hurdles they must face when the credit report has these types of negative items on it.  I want to help you if this is your situation.  I want to help you if you need to buy a new car. I want to help you if you want to get some new credit cards or you just want to clean up your credit. I love what I do. It is my passion and I'm good at it. 

I love seeing clients' credit reports go from awful to spectacular. I love the fight. I love sparring with collectors, creditors, and bureaus. Most importantly, I love to win.  When I win, its Your win. When I win, your ugly credit report becomes a pretty credit report. That's what I love to do. I love to help consumers have pretty credit reports that allow them to get the loans and credit they need at interest rates that don't choke the life out of you. I love  to help consumers save money on their insurance, their utility deposits, their ability to rent a car, to be able to get that new job or keep the job that scrutinizes their credit.

I love this so much that right now I'm running a special. From now until September 5, 2014 or the next 25 people, whichever comes first, I will go after the removal of a public record for half price.  I would say that I will remove it, but the law does not allow me to promise or guarantee results.  I know what I'm able to do, but I won't break the law in my processes nor in my claims. Bureaus, creditors, and collectors may lie, but I won't. So, again, I will go after the removal of a public record item at half the regular price, for the next 25 people or September 5, 2014, whichever comes first.

Please don't hesitate if you want to save some money on this. I fill up my client rotations quickly.  The sooner you contact me, the sooner we get started and the sooner you can expect to see a prettier credit report! Please call or email me today.

PS: If you are a loan officer, real estate agent, insurance agent or someone who has clients that need my services, anywhere in the country, please contact me. I want your turn downs. I'm willing to earn your business and send you back clients who are able to qualify and get better rates. My services will help you close more deals.  If you are a real estate agent or broker, I offer an airtight non-compete that I believe will put any of your worries about that issue to rest. I'm not looking to act as your clients' real estate agent. I'm looking to get their credit where it needs to be so you can close deals.

PPS:  I also do lunch & learns and workshops for your potential buyers and agents in Southern California. My partner and I come and show how we can help your clients become homeowners and how we can help your office close more deals!  Please contact me today!

If you have found this blog helpful to you, please consider donating as a sign of your appreciation for information I have freely given to you.  The "Donate" button is on the right side bar.  Thank you for your generosity.

 

You Don't Owe Your Debt - Its All A Fraud!

You've been duped and you don't even realize it.  When you think you borrowed money, you are incorrect. When you think you have to pay back money for what you borrowed, you haven't learned the truth.

Most people grow up believing what they are told by parents, teachers, lenders, politicians (well maybe not so much them), our government. Few grow up challenging what they are being told. Few people stop and ask why or how. Few people stop and say, "Prove it!"  

I'm one of the few who has always questioned what I was told. I was always labeled as argumentative when I really was just looking for answers. Somewhere in my gut it seemed that things I was taught and things I was told was not the whole truth.  You may have had that same feeling at times in your life. But we are conditioned to just accept what we were told as the truth.  Its not our parents' fault. They didn't know any better because they were  raised the same way.  You just don't question authority and you should just respect your elders.  

Well, in my book, you should question what triggers a twinge of doubt in your gut and why respect your elders (lying government officials, lying banksters) when they are not telling you the truth and they have an agenda to keep you from knowing the truth.  Truth is power and they want to keep you from gaining any truth or power because they want it all for themselves.  Then they can control you and enslave you.

I've decided to post a video today. Please take the time to watch it. Its about money. Where it comes from, where debt comes from, and how its all a fraud that has been kept secret so you won't find out the truth.

There are 5 videos in this series. I encourage you to watch all of them when you have a chance.  They will help open your eyes to the scam that has been played on all of us.  I hope that it helps you understand that getting into debt is not your fault because that's how this system was set up - even if you maxed out credit cards, were allegedly irresponsible in your spending, and just got to a point where you had to walk away or give up trying to pay these bills for credit and loans. 

When the truth about this sinks in, you may get a bit angry, and rightly so.  I care about you and I want you to know the truth.  Please, if this video opened your eyes a bit, then share it. I would love it if you shared my blog with others. They too can watch the video right here but also, there's a lot of information that I give that may be what they need to help handle their own credit issues.

Thanks for reading, watching and sharing.  Enjoy!

If you have found this blog helpful to you, please consider donating as a sign of your appreciation for information I have freely given to you.  The "Donate" button is on the right side bar.  Thank you for your generosity.

Disputing 3rd Party "Debts" After The 30 Day Requirement Has Passed

Many times consumers get letters in the mail from debt collectors saying that they have some debt with this company and they need to pay the bill. Some will claim they are offering this great one time settlement offer saving you 40% or 50% off the total if paid by some date.  Really?  Should you take them up on it when I can show you how to save 100% of that ridiculous bill?

The letter, which is called a Dunning letter, is required by law to have language in it that says you have the right to dispute this debt within the next 30 days.  But what if you decided to blow them off and throw away the letter? Do you lose your right to dispute it after the 30 days has passed? Let me explain how this law actually helps you.

Here's the thing about this law. Its FDCPA §609 or 1692(g).  This law says that they must inform the consumer of their right to dispute the alleged debt and if the consumer does dispute it during the 30 day period, then the collector must stop all collection activity. Now, it doesn't say that they can't furnish information on the credit report in the first 30 days, but if they do, your best chance of making this never go on or make it come off quickly from your credit report, is to dispute in the first 30 days.  This is because furnishing information on someone's credit report is considered collection activity.

But if you don't respond in that first 30 days, the law does not say that you can't ever dispute it.  I've had collectors tell my clients that they don't have to validate because it wasn't disputed within the first 30 days.  They are absolutely correct. But, these punks are spinning the truth. You see, there is nothing in the FDCPA that REQUIRES them to validate. Nope, not at all. BUT...what it does say, is that if a consumer does dispute, they MUST cease all collection activity until they validate - if they choose to.  If they choose not to validate, then, that's fine, it means they choose to delete it. Its one or the other.

The FDCPA also says that if a consumer disputes, they have to notify the credit bureaus that the account is disputed. Here's the fun part of that. The bureau employees are so uneducated in the FDCPA they don't get that they are going to help the collection agency violate the law. They put a comment on there that the account is in dispute. I really crack up at this.

The FDCPA just told them that they have to stop collection activity if the consumer disputes. So, the collection agency notifies the bureaus that its in dispute and a dispute comment goes on the report.  What does this mean? How is that a violation of the law?  Well, when they tell the bureaus the account is in dispute, they are not supposed to be instructing them to put a dispute comment on there, they are supposed to be deleting the account from the credit report.

What they have effectively now done is continue collection activity (because its still on the report) but now they are broadcasting to anyone who sees the report that they are breaking the law. Do you understand this? Its simple. They just need to delete  it!  

So, even if you have missed that 30 day period, your right to demand validation or dispute is not revoked. You can dispute at any time. Its just that they've been better trained at removing them from credit reports when they get a dispute during the first 30 days, than they are educated about how to handle disputes they get after the first 30 days. They obviously  are not taught well that any dispute at any time, means that for a 3rd party collector, it absolutely must be removed from the credit report until they fulfill validation.

I sure hope you understand this and use it to your benefit!  Dispute away, tell them to remove it until its been validated, and if they just put a "dispute" comment on there, well, if you sue them, you just earned an easy $1000 bucks!

Feel free to comment on this or email me with questions.  I'm here to help you successfully get rid of the ugly stuff on your credit reports and get it looking pretty again!

If you have found this blog helpful to you, please consider donating as a sign of your appreciation for information I have freely given to you.  The "Donate" button is on the right side bar.  Thank you for your generosity.

Debt Settlement And Negotiation Is Bad For Your Credit!

I'm not a big TV watcher but sometimes when I do, I see ads for debt settlement and debt negotiation services.  They sound so nice and the actors pretend that their life after signing up is just so wonderful, like it solved all of their problems. Its a crock!  If they were honest about it, they would have a disclaimer that you could hear at a normal speed of talking where they told you who really benefits with debt settlement.

If you've read much of my blog, you have most likely read that you don't owe collectors a dime and you shouldn't pay them or settle with them. I feel the same way about charged off accounts with original creditors. You don't owe them squat.  Of course, that's not what you're going to read on most websites and blogs. No, they just keep spitting out the same garbage that the bureaus and the FTC, and the creditors and collectors want you to believe. 

But, you have to think about it. Why would they tell you that a charged off account still has to be paid? Why would a collector who you've never agreed to do business with tell you that regardless if its been charged off and now they own it, that you have to pay? I know you have got to sort of have the answer in your head as you read this - its so easy!  Its because they know if they get you to pay, they are going to make butt loads of money off of you and everyone else they convince that they need to pay.  What's that saying? Follow the money!

So why is debt settlement so bad for your credit?  Let me explain a little about your credit report and scores.  When you have a charge off, it can really cost you some points. But, as time goes on, it has less and less effect on your score.  In fact, at 2 years, it really isn't affecting your score at all. At least its not if they are reporting it properly. What I mean by that is, it should show what your high credit is and your balance should be $0 and your past due should be $0.  Anything other than that is wrong and even at 2 years old, it will be affecting your credit and your score negatively.  

This is when most people see that charge off and they think if they do the fake "honorable" thing and pay it off, it will help their score. NOPE! It will hurt your score.  What you should do, is tell the original creditor that you are not happy that they are intentionally damaging your credit score by knowingly reporting erroneous information. They charged this alleged account off. Their books say $0 past due now and $0 balance. So why on earth are they reporting anything other than $0? I admit that there's a lot of incompetent people working for these folks, but it is intentional. They want to screw you over because you stopped paying and they didn't get to swindle you for the full amount they were hoping for. Its retaliation!

So, they may come back with a phony verification but offer you a sweet deal to close it out. If you do that, what will happen to your credit is a new negative report that now will take another 2 years to have no affect and another 7 years before it will "fall off" of your credit report. Oh, and your credit report will also say that you settled! Is that helping you? Nah, but they made more money off you. They also took tax credits when they charged off, so now they have just committed tax fraud.  And when they charged off, they got a secret insurance payment that paid it off, so they also just committed insurance fraud. So tell me again how you benefited?  You have a fresh negative and 7 more years of negative crap on your credit and paid for something that had you continued to fight about, you never would have paid and you probably would have gotten it off your credit.

Let's talk about 3rd party debt collectors. They notify you that they are now collecting on behalf of an old credit card or medical debt that you failed to pay. But oh, lucky you. They're going to offer you an awesome deal where they're going to knock off half of the balance you owe them. Stop! You don't owe them. When did you contract with them?  Were they mentioned on the contract with the original creditor? NO, NO, NO they weren't! 

What you should do is demand validation from them. I think that probably 90-95% of the time, when they bought the portfolio of bad debt from the original creditor or some other junk debt buyer, they were missing a lot of the supporting documentation. I say this because 97% of collection lawsuits end up with the collector winning a default judgment. The defendant (think, overwhelmed or not notified consumer) doesn't fight it or respond. So, if they can count on that many default judgments, why would they care if they got full documentation to support the bad debts they buy?

When you demand validation, more than 1/3 of them will hit the road. They may sell it to the next junk debt buyer to try to recoup some of the money they spend, but each time they resell it, you have a higher success rate of getting rid of them.  But let's get back to debt settlement. Why would you settle with someone you don't owe, even at 1/2 the amount, when they bought it for probably no more than 20 cents on the dollar? That means they are also making money off of you when they never lent you a dime. And they probably can't prove you owe them anything.

But here's the bad part. They will now report that you have a paid collection.  A collection is worse than a charge off. It is bad. Always bad. And paying them is more fresh bad. No collector should ever be on any one's credit report, but if you pay them, you will have an even harder time getting it off because they have no incentive to delete and they will claim because you paid them, you contracted with them.

Now debt negotiation is a little different. This is where you hire a company to negotiate a settlement for you.  Why is this bad? Well, for all of the above reasons, but also, now you are paying another company money. They won't make payments on your behalf right away. No, they hold on to the money.  Oh wait, that's not correct. They will take a portion of your payment and keep it as part of their fee, and then hold on to the rest until you build up enough to make a settlement offer to 1 or a few creditors and or collectors. So now, you may have just been struggling to pay the credit card bills, but were never late, and this company stopped paying them, when you thought they were going to be managing it for you. Oh boy are you getting screwed!

Debt negotiation firms, (if they don't take your money and run), they hold on to your money so long without making payments that you will end up with charge offs, having original creditor debts now go to collectors, have your car repoed, even get you into a situation where you get sued! Wow, they are really helping consumers, aren't they?

Now there's also the consumer counseling companies. They do debt settlement also but its a little different. What they do is negotiate to lower or freeze the interest rates. But, the balance of the debt stays the same, plus you have a monthly fee for them negotiating with the credit card companies. You don't get any cut in the balance at all.  Its kind of like a Ch. 13 bankruptcy and they will many times notate on your credit report that its included in a counseling plan.  The only thing I can commend these types of settlement companies on is the fact that they actually will be making the payment to the creditors every month. That's because they don't have to save up a large amount to negotiate a balance settlement. So as long as you make that payment every month to them (which of course includes their service fee), they'll pay the creditors.

Okay, so who benefits? Well, many times these companies claim to be non-profit. That doesn't mean anything for you. It means they are exempt from taxation, but it doesn't mean it costs you less. And who donates to these companies, gives them grants, invests in them, keeps them up and running?  Many times its the credit card companies! I can tell you for sure the credit card companies are behind most of the credit counseling companies. Its another nice tax credit.  Did you see that one coming?  Its a stinking scam! So, now the negotiation company benefits, the original creditor benefits, the collector benefits, but how on earth do you benefit?

Every month they don't pay because they're building up the payoff fund, your credit report gets more late notations and your score drops, and you get charge offs, and you get new collection activity being reported on your credit. You aren't benefiting at all! You are getting spanked!

What annoys me also is, they have the nerve to claim they are helping you repair or restore your credit. Its such BS! They are no better than dirty 3rd party debt collectors. They are lying thieves!  None of them are out to help you. They are all vultures finding different ways to snipe your money from you. They don't care what kind of hardship it causes you. They don't care that it jacks up your credit. All they care about is the money. And its a lot of money. These debt settlement and debt negotiation companies make big money, whether they are for profit, not for profit, or non-profit.

If you want to fix your credit, don't think for one second that paying one of these companies is going to help you. They are not, and that's a fact! If you want to fix your credit, you're going to have to learn how to fight back. Learn to write validation letters. Learn how to read your credit report. Learn how to know if what they send back as validation or verification is accurate or actually validation or verification. You have to learn how to respond to them. If you want to be successful on your own, you will need to learn some laws and not just say the same thing that letters you find online say. You have to understand the laws. You have to know how and when  to use them, which ones to use, which case law to throw back at them, what to say to defend yourself and make them pound sand!

I try to teach you here how to stand up for yourself, how to fight to get your credit score back up and your credit reports looking pretty. But, it takes commitment. It takes time. It takes persistence and not everything always comes off.  You probably won't have as much success as someone who does it professionally, but you can see fantastic results if you keep at it and if you use a lot of what I share with you on this blog.  I don't think you'll find anyone else who has been in the business as long as I have been, willing to share as much truth and strategies and laws as I do here.  What I share has helped me be successful for almost 3 decades. I want you to be successful too!

So, I congratulate you on making the decision to fight to restore your credit and improve your credit. You can do it.  But, if you find you just don't want to do it on your own, I would love to help. Use the phone number or the email address up at the top right hand side of this page to contact me.  Let's get started on your new clean credit report so you can get those better insurance rates, you can get that job, you can qualify for that car or home purchase. Let's get you going to finally get back your life!

How To Write A Validation Letter

I get a LOT of emails asking how to write a validation letter so I'm going to try to explain it again here.  Validation letters are NOT sent to Original Creditors.  Validation letters are NOT sent to Credit Bureaus.   They are ONLY sent to 3rd Party Collectors.

When you get a letter from a collection company, the first time you receive one from that company, they should be very clear that you have a right to dispute their claim within 30 days.  This does not mean that they won't be putting it on your credit report or that they haven't already put it on your credit report.  But it does mean that they will have to immediately stop collection activity when they receive your dispute or what we call a Validation letter.

Sometimes you never get that first letter or maybe you did and you ignored it, but you have a copy of your  credit report and you see a collection account on there.  You will want to dispute this with a Validation letter as well.  Even though you may not have disputed within the first 30 days of being notified that this collection company is hot on your trail, or you never knew about it until you saw your credit report, once they get the Validation letter from you, they must stop all collection activity.

A Validation letter is demanding proof that you owe them something.  You have the right to challenge their claim and make them stop collection activity pursuant to the FDCPA (Fair Debt Collection Practices Act).  Collection activity can be phone calls where they are pressuring you to pay something, another "bill" saying to pay, and even verifying the alleged debt or updating the alleged debt on your credit report.  They must stop ALL collection activity until they prove the alleged debt is yours.  The only things they are allowed to do at this time are to 1. Prove the alleged debt is yours; 2. Mark the alleged account as "In Dispute" on your credit report; or 3. Send you a letter stating they are closing the file and removing it from your credit report - or similar language to that effect.

A Validation letter should always be sent Certified Mail and preferably with a Return Receipt.  These are some of the things that you will want to keep for your "paper trail" if you end up in court against these suckers.  So, always keep a copy of each letter sent and the certified receipt showing they got your letter. Also, keep every letter they send you. You will be able to find violations they commit and also whether or not they responded and if they sent all the information you demanded in your Validation letter.

Validation letters can be short and to the point, or long and full of laws, or anywhere in between.  The best Validation letters are the ones you write yourself. The worst to use are the ones you find all over the internet or in some book where you said everything they did, word for word.  You want to make the letter your own. Put it in your own words. If you're pissed off and feel like letting them know, well then make sure your letter gets that across to them. I believe its absolutely fine to not be nice in a letter to any collection company. They are ruthless, rude, law breaking  scum, so why would you have to be nice to them?  Write from your heart while you make sure you demand they try to prove their claims.  If that's not you, if you just would  rather be nice or plain matter of fact, that's perfectly okay too.

The letter to them will start off with a Dear Sirs, or To whom it may concern, or some sort of generic salutation. Then you tell them you either received their letter claiming you owe them something or you have a copy of your credit report and saw that they are furnishing information on it that they think you owe them something.  Then you tell them you don't believe you owe them anything and you are disputing their claim and you demand that they stop all collection activity pursuant to the FDCPA.  You don't have to put that its pursuant to anything if you don't want, but whether or not you say that, it is pursuant to the FDCPA and they know it.

Make sure you reference the alleged account number that they assigned to the alleged debt. Now you can tell them what you want them to provide to you.  You definitely want a copy of the alleged contract that shows you agreed to do business with them.  You want a copy of the contract between you and the alleged original creditor. You want a full accounting - meaning, how did they determine how much they claim you owe them.  They usually have added extra charges for interest and collection fees so they need to explain exactly how they got to the amount they are telling you to pay them.

They also need to provide proof that they have a right to collect the alleged debt.  This means they will need to show the contract between them and the original creditor, or whoever they got the alleged account from, and the full chain of assignment. This means, if they are not the first collector claiming you owe this alleged debt, they need to show every single collection company that had it from the original creditor, through every 3rd party scum bag, to them.  Now if you are in a state that requires collection companies to be licensed and/or bonded, they need to provide copies of those items as well.

Another important item that they should be able to provide to you, is the date of the last payment and proof that the alleged account is not outside the Statute of Limitations. If the alleged original account is Time-barred, this is a fantastic way to get rid of them fast.  Some companies don't care and will continue to try to collect and may even sue you on Time-barred debts.  As long as you make no payment to them, make no payment arrangement with them and never admit you owe the alleged debt, it will stay time-barred.  You have to be very, very careful here. In some states, just acknowledging that you ever owed the alleged debt is enough to start the Statute of Limitations clock all over again, so DON'T DO IT! Don't admit Anything - Ever! Don't make a payment to these fools - Ever! Don't agree to a payment plan - Ever!

The next thing I believe you should tell them, and I think its very important to say it in writing, is that under no circumstances do you authorize or give them consent to furnish any information to your credit reports nor to take any action that would result in an inquiry on your credit report from their company. You should tell them this whether they are on your credit report or not.  In order for a company to inquire or furnish information on your credit report, you must give your authorization for them to do so.  Read my previous post, just before this one, so you understand what it takes for them to be able to have anything to do with your credit report.

Now, if they are already furnishing information to your credit report, also demand that they provide a copy of your consent and/or authorization that allows them to furnish or inquire on your credit report. Remind them that without this proof, they must remove all traces of their slander from your credit reports.

You really don't need much more than this in your validation letters. If your want to, you can use case law or the actual laws that give you the right to demand everything you have told them to provide to you, just to give your letter even more weight. You can use something you find on the internet and request the same things those letters say, but again, put it in your own words.  Don't use a form letter and don't copy word for word from those letters. They just don't have as good of an effect or result  as your own letter will have.

Okay, now you've come to the end of your letter. Here is something super important. NEVER, NEVER, NEVER sign your name to the letter.  You may type it or print it, or stamp it, but Don't Sign in YOUR Handwriting!  Also, NEVER, NEVER, NEVER give them your social security number. And nowhere in your letter at all, NEVER, NEVER, EVER admit that you owe them diddly nor that the alleged original account belongs to you.  

You don't ever want to acknowledge anything other than you received their correspondence and/or you see that they are reporting on your credit reports. They are the ones that should be sending you proof.  You have NO obligation to send them copies of ANYTHING or to disclose anything to them. No copies of old bills, no social security number, no utility bills, no driver's license, no birth date, no whatever they claim you need to send them as proof of anything.  You are not the party needing to prove something - THEY ARE! 

If they are requesting you send them something, it means that they don't have what it takes to even come close to resembling validation. The minute they start asking for you to provide any type of information is time for you to tell them you know they obviously are fraudsters and have no proof of any alleged debt and they need to go pound sand.

So, this is how you write a Validation letter. Hopefully you will craft an excellent one that successfully gets them out of your life and off your credit reports. I'd like to tell you that you will probably be a lot more successful if you can respond to their initial letter within the 30 period. But if you've missed it or never received that "Dunning" notice, don't worry. You still retain your rights, you just need to exercise them and be consistent. Don't accept their claim of validation, don't accept anything other than they are ceasing the game with you and always respond until they give up and go away.

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