Fighting Collections - They Are All Fraudulent!

I'm going to warn you right from the start that this is going to be a fairly long post. But I believe it will be an easy read and you will learn some very important information. Some of it may seem unbelievable but I assure you that it is true. Look, I've been doing this for over 31 years now. I can prove what I'm saying and I have proven it in court for quite a few of my lawsuit clients.  So grab your munchies and something to drink and let's start class!

It amazes me that people pay collection companies when they really don't owe the debt. Maybe they feel they have a moral obligation or they are stressed out and think paying them is the only way to make them go away. Maybe they've been convinced that they owe it and no one has taught them the truth about collections. Maybe it's a combination of the above, or all of the above, or some other reason that makes sense to them. Almost no reason makes sense to me.

Talking about collections with me makes me just go off, spewing out one fact after another and sometimes I get so riled up I get potty mouth. Yep, I do blow it occasionally when it comes to collections. Their fraudulent behavior and bullying, harassment, lies and stubbornness sometimes sets me off.  I'm going to teach you about collections today and I promise I will try my hardest to keep my words clean so as to not offend anyone or put bad language in front of youngsters that may read this.

Let's start from the beginning and we'll assume the original account is a credit card account, (but this scenario applies to most types of collection accounts including medical, utilities, insurance, cable/telecommunication accounts as well).

When you are approved for a credit card account, you are given plastic and a credit limit. When you spend using that card, the bank/card issuer convinces you that they lent you money/credit limit for you to spend. But that's not the truth. Banks are not allowed to lend money from their assets nor their depositors' assets.  It's also completely illegal to lend credit.  So now that you know that banks can't lend money or credit, what are they lending you?  The answer is NOTHING! 

What actually happens is that credit card agreement with your signature becomes a negotiable instrument. Your signature gives it energy and value. Title 12 instructs banks to treat negotiable instruments as cash. In accounting, a bank treats it as "cash equivalent" and that means that YOU FUNDED THE ACCOUNT!  The instrument has your signature on it. You own it. But they NEVER disclose that to you. You are actually making a loan to the bank but they trick you and convince you that they lent you something, totally ignoring that you were the one lending something.

Let's skip over to contract law for a moment. In order for a contract to be valid, there are 4 main elements, in addition to being bilateral - meaning 2 signatures, 1 from each party. The 4 essential elements are Offer, Acceptance (you have these two in your contracts), FULL DISCLOSURE, and EQUAL RISK. Your credit card account contract is missing the last 2 essential elements for a valid contract.

To have full disclosure, they would need to inform and advise and disclose to you that YOU are the one who is funding the account. They would have to disclose to you that the account is going to be insured in case of asset loss for the bank's favor and that you will be paying the insurance premium for that asset loss insurance (known as "credit default swap"), and get your written consent to the amount of the premium. They would need to disclose that they will most likely only service the account and transfer "ownership" to a special purpose vehicle such as an asset backed trust. They would need to disclose that this is securitization and that by separating the payment stream from the note, the contract is void. 

To have equal risk, both parties must have something to lose. What do the banks have to lose? They don't lend anything. They are insured against loss, they sell it and transfer it, they get tax credits. WHAT DO THEY HAVE TO LOSE? The only thing I can think of is insane amounts of illegal profits that they really aren't entitled to. But really that doesn't fit either because they insure everything! They can't lose!  Anyhow, I hope I've explained why the banks don't really have a valid contract.

Now, moving on to the creation of collection accounts and the fraudulent nature of them. 

You have your credit card account and you're using it and paying it regularly and consistently and then something happens that causes you to be late. You get hit with fees. You catch it up and use and pay and use and pay but you get to a point where you just can't keep up with the payments and you default on your agreement. The account gets further and further behind. So you try to work something out with them but still you can't keep up.

Let's say you asked me to try to talk to them about the account. So I call them up and say that I want to discuss account number  1234XXXX, and see what can be done to save the account and get back on track.  They ask me if I am Mary Doe and I tell them, no, I'm Shannon, Mary's friend, or sister, or whatever. They will then tell me that they cannot discuss the account with me or anyone except Mary unless she has given specific authorization or a Power of Attorney to speak with them on her behalf.  This is important to understand. They CANNOT share any information about Mary's account with me or ANY PERSON (corporations are also defined as a "person") without a request, agreement, authorization, or Power of Attorney specifically naming that person as authorized to communicate and receive her account information. THIS IS IMPORTANT!

Well Mary can't catch up the account and at 180 days, the bank needs to remove it from their books and they charge it off.  But wait! Remember that they insured that account in case of loss due to default or other credit/asset loss?  They never tell you this but at approximately 90 days, they are allowed to file an insurance claim for that asset loss. The insurance company then issues a check for the amount of loss they claim they will or have incurred. The account is now PAID OFF IN FULL.  Remember who paid the insurance premium?  That's right, it was you - whether you knew it or not you were charged the premium and you paid it. Or maybe I should say your negotiable instrument paid it. 

That insurance payoff happened at approximately 90 days of default. Remember I told you that the banks charge off the account at 180 days? That charged off amount is the balance they report to the credit bureaus, or an amount near the amount of the charged off amount. IT'S A HUGE LIE!  The account was paid off by insurance that YOU paid for. The balance is $0! They charged off NOTHING! Scam! Fraud! Lies! Schemers!  Your credit reports should ALWAYS show the charged off account has a $0 balance. Oh heck no! It shouldn't even be a charge off. You paid off that account in full at approximately 90 days of default. And that's not even taking into consideration that you funded the stinking account in the first place so you never really were in default and didn't even need insurance to pay it off. I swear! Now you know why I get so worked up. But oh, it doesn't end there.

When they do their charge off of the account, next they recoup some more money by filing a Profit and Loss on their taxes. This allows them to take a deduction or receive a credit for that asset loss.  Funny how they conveniently forget that they never lent a dime, never lost a dime, actually made money (from your payments and insurance payouts), and still benefit from the P&L. You'll see that P&L on your credit reports quite often under "Account Status." 

Now that they've squeezed out as much money for that account as possible for the time being, they use the credit reports to try to extort that fake balance out of you. Some people fall for it and you will see a Paid Charge Off on the credit reports. Many times people pay them because of the threat of being sued. Oh the greed of the banks!  

Banks don't always hold onto charged off accounts. Sometimes they crunch the numbers and figure that it's more beneficial to sell off the charged off accounts. This is where the 3rd party collection company enters the picture. They usually bundle up a lot of charged off accounts and sell them as debt portfolios.  Then "debt buyers" purchase them. I really hate the title of "Debt Buyers." They don't buy debt, they buy YOUR INFORMATION.

Now please recall the little scenario of me trying to talk to the bank on Mary's behalf. Do you remember why they wouldn't talk to me or anyone else about her account?  They, by law, cannot share any information with any person without Mary's consent. They can't share info or communicate or negotiate without her authorization or a Power of Attorney, or an agreement such as a company stepping in and paying off the account  for which she would have contracted to now pay them. An example of this would be similar or the same as a refinance.

When banks sell off their portfolios of charged off accounts to a 3rd party collection company or misnamed "debt buyer," they are selling the account information only, because remember, the account has not only been paid off by insurance, but also charged off and received tax credits. But, they NEVER contact the account holders and get their consent to share that information  with any other party. They do it behind your back! They do it without your consent and without your knowledge.

I declare that this is collusion between banks and collection companies to perpetrate identity theft on account holders.  Collection companies get these accounts, create new accounts that you know nothing about then send you a bill claiming you owe them. Wait!  Where's the contract? Contract law requires a valid bilateral agreement between you and another party. It requires offer and acceptance. When dealing with a collection company, there is No upfront offer and acceptance. There is no full disclosure - they ALL know that the true account balance is $0 and I've confirmed that with a broker for debt portfolios. They KNOW! Lastly, it's obvious that there is NO EQUAL  RISK! It is impossible to have a valid contract with these debt collectors. It is also highly likely that collection accounts are insured as well. I'd guess that I'm about 95% sure of it.

WHAT A HUGE SCAM ON CONSUMERS! GRRRR!  I know some of you are feeling what I feel when discussing this huge fraud on consumers. It's an outrage!  It's intentional and willful and corrupt.

I'm not advocating not paying your bills because it all starts off with a failure to disclose, no real lending, no truly valid contract, etc. I believe that in this society, you have to play the credit game in order to achieve the American dream of home ownership and purchasing cars, or personal loans, renting a place to live or renting a car, turning on utilities, getting insurance, getting a cell phone, or whatever. You need good credit to obtain additional credit or financing for major purchases. I'm just  wanting you to be aware and awake. I just want you to understand about collections and learn to fight back. I don't ever advise anyone to pay a collection account though. It's all a sham. 

Demand validation of these collectors. Demand they produce a valid contract. Demand they produce a signed authorization. They shouldn't be on your credit report for any reason but since they are, they certainly should not be there without an authorization to collect information and make communications about you and an alleged account. They can NEVER truly validate. There is no valid contract and there is no POA or signed authorization. They've never lent anything to you. They are not named on original contracts with original creditors so they don't even qualify to subrogate/substitute themselves on to a contract. They have no interest to protect. They haven't been aggrieved and are not entitled to seek redress. 

I hope you've learned a lot from this post. I hope it gets you fired up to fight back. I hope the information helps you to see success against these 3rd party collectors to get them off your credit reports and out of your lives! 

If you have collection accounts that you need off your credit reports and you don't want to take on the fight alone, contact me because I love my work. I love fighting to get these thugs off your reports and out of your lives. 

Using the Section 609 Credit Repair Process

This is a subject that I have wanted to write about for some time now.  Many of you have heard about this method to repair your credit. Probably some of you have done it.  I'm not a big fan. I heard a lot of reports about people who have used it.  There have been some that have experienced success with this method and most of those were people who used it way back when it first came out.  I have heard of many more people that have used it and not had near the results they were expecting or were assured that they would have.  I too have used the method a couple of times for my clients but had to go back to using the methods I have used successfully for over 3 decades.

My first problem with this method is that it is only disputing with the credit bureaus. When you are going after 3rd party collections, I believe you need to protect yourself with validation demands so that you have it in place in case the collector decides to sue you.  If you have demanded validation, they cannot sue unless they have validated - a task they cannot actually and lawfully succeed at because they do not have first-hand knowledge, they have no contract, and they do not have your permission to collect information and make communications about you and the alleged account.  They have to get that authorization from you, in writing.

This method, the Section 609 method is bureau disputing only.  It is based on a good concept that requires the credit reporting agencies to prove  the verification they claim. This is a task that they NEVER do. They don't have the ability to do because they don't conduct reasonable investigations, they don't collect the documents to support the information furnished, they don't get authentic verification because verification requires sworn testimony (affidavit) accompanied with that supporting documentation. All they have is hearsay, which the courts have deemed as incompetent and inadmissible.

So, here is how it works:

You write a letter to each bureau telling them to provide the documents used to verify or that validate the following accounts.  You  are demanding that the send you the verifiable proof (copy of the original contract between the furnisher and you) that the FCRA requires them to have in your file. The word "file" is very important because they try to convince you that a "file" is the same thing as a credit report, but it is not.

Next, most templates have a table that has the furnisher name (creditor/collector) then the account number, then the dispute says "unverified account" in the final box of the table. One of the requirements under both Section 609 and 611 requires that information that is incomplete, inaccurate, or unverifiable be corrected or deleted. So, just above the table you tell them provide the proof for each account within 30 days or delete it as required by law.

The bottom of the letter tells them to remove all promotional non-account related inquiries and to suppress your information from promotional services - in other words, opting out.  After that is the signature though some variations of this credit repair process has you get each letter notarized.

So that is the method.  There are letters 2, 3 and 4.  Each letter is basically the same, but the language in each consecutive letter gets stronger. The second letter tells them that it's the 2nd written request and they claim to have verified but didn't provide any documentation. You are demanding they provide you the documentation along with the name, title, contact information with the persons who they spoke to or communicated with in their "re-investigation" in order to prove to you that an actual reasonable investigation was done and they acquired the documentation proving the account was verified.

The letter reminds them again that they are required to delete unverified accounts and if they cannot provide that documentation, then it is not verified and must be removed according to Sections 609 and 611.  It also reminds them of their civil liability (meaning you have the right to sue them) under FCRA  617 for willful negligence.

Once again the 3 column table is there with creditor/collection company name, account number and unverified account. You of course remove any accounts that have been removed from the report from the first dispute.

Round 3, letter 3. Almost the exact same as round 2 letter but it says it's the 3rd written request and then above the table you demand that they send the documentation or delete immediately. Again you make sure that you don't dispute any of the accounts that were removed from the first and second disputes.

Round 4. This letter is again slightly different.  It has a header on it that says its a Notice of Pending Litigation Seeking Relief and Monetary Damages pursuant to FCRA Sections 616 and 617. It calls them out for not investigating, not providing documents, falsely claiming the accounts are verified but never sending the proof.  It tells them the 3 previous letters they received disputing the items will be used as exhibits and evidence if they proceed to litigation as will the credit reports showing they have been disputed and claimed to verify.  

This 4th letter is definitely notarized. Also, with each round of disputes you are expected to provide copies of your ID and SS card.  I'm not big on that at all but for this process, it's recommended.  You don't want to give the CRA's any loophole for not doing their job and following the law.

So, that is the process.  I however think that you need to send validation letters to collectors and proof of claim letters to original creditors. You need to demand that they provide you with the documents used to supposedly verify the information that the furnished to the credit bureaus. You let them know that a response letter that provides a summary of the account is NOT verification, is NOT validation, is hearsay and it will be rejected because you agree with the courts that hearsay is incompetent and inadmissible.

In my follow up letters to these collectors and creditors, I call them out for not sending certified copies of original documents, sending a slew of billing statements that are NOT proof of a full accounting, not sending proof of how the account was funded and where those funds came from, proof that the account is still within the statute of limitations, proof of license and bonding to collect in the consumer's state, proof of a Power of Attorney document or written authorization showing that consumer gave their consent to collect information and make communications about the alleged account, and proof that the 3rd party collector was specifically named on any original contract showing they are entitled to collect by having an interest to protect.

I like to write bureau letters that do include Section 609, but I use many other sections of the FCRA, federal acts, code of federal regulations, case law, state statutes, UCC, and other legal ammunition.  I don't like relying on just 1 main section of the FCRA.  I do the same thing with my direct to creditor/collector letters. Demanding proof of claim or validation is important to protect yourself and including laws and the above legal ammunition, proper wording is important to see a higher rate of success in your credit repair journey.

I hope you will find this information helpful.  If you are in need of credit repair assistance and don't feel like taking it on yourself, please contact me at futurefico@gmail.com. I may be able to assist you.

Have You Just Been Served By A Debt Collector?

Have you just been served a summons notifying you that a 3^rd party collector is suing you?  You need to act fast.

Most states' courts give you 20 – 30 days to file a response with the court. After that time has passed with no answer from you, the debt collector can motion for a default judgment – and be granted that default judgment!     

     

Fight Back!  You don’t owe a 3^rd party debt collector squat! You have no contract with them but if you don’t take action, they can, by your silence, have that court order a contract with you by way of a default judgment.  “Silence equals Agreement!” Don’t remain silent!

I can help you fight back.  You can’t beat them if you do nothing.  I know it’s scary, intimidating, and stressful. Sometimes you feel like you don’t know what to do or say, and you feel defeated.  That’s what they want you to think and feel.  If you fight back, you can win!  I want to help you win!

Contact me today. I fight better than most any lawyer will fight for you and I’m much cheaper too. I’m not interested in telling you to settle with them or file bankruptcy.  I fight to win! I have a 100% success rate. The law doesn’t allow anyone, including an attorney, to guarantee you will win, and I'm not guaranteeing that either, but I have a track record. I fight with laws and affirmative defenses and powerful discovery requests that so far, have yielded dismissals for my clients.

Don’t let these collectors win without even putting up a smidgen of a fight. Don’t let them smear your credit, get in a position to garnish your wages or put a lien on your bank account or other property. Contact me today.  Let’s beat them together!

Email me at futurefico@gmail.com or call me at 951-801-2828

Disclosure:  I am not an attorney.  I don't think that slow or stoop that low. I have however gone up against many debt collection attorneys and my paperwork prevails while they stand by, whine, stomp their feet and wail because they did not win. 

Why You Should Demand Validation From Debt Collectors

The majority of questions and requests for assistance are about debt collectors and 3rd party collections. These companies want your money but they did nothing to earn it or deserve it.  They are not owed anything and you really need to fight back to avoid paying them what they are not owed and to increase your chances of not being sued by them.

Many credit repair companies and many consumers as well dispute these items directly with the credit bureaus to get them removed. Sometimes you can have pretty good results for your credit reports by just disputing with the credit reporting agencies (CRA's) but most of the time, and especially if you are using an online tool to dispute, your results are not going to be great and sometimes not permanent.

But here is what I view as the problem with just disputing with CRA's. You're only disputing the accuracy for the most part.  Many people tell me they just dispute them as "No Contract" and most of the time I hear that the results come back as verified.  Even if the item is removed, it only means that the company just didn't respond in time or preferred to just let it be removed from the credit reports. Because you really don't demand validation through the CRA's, you haven't blocked their collection efforts.

Just because something isn't furnished to your credit reports doesn't mean they can't attempt to collect from you.  In order to block their collection efforts, the FDCPA says you must demand validation in writing. Once you have demanded validation, they must cease all collection activity until they validate. A demand for validation is the tool or weapon you need to use to get them to back off.

Now, many times these thugs make claims that they have checked their records, or that they have verified or that they have fulfilled validation requirements and they just continue on with their collection activity.  However, a well constructed validation demand letter will protect you in court if it lands there. When I say well constructed, I'm not talking about the nonsense you find online.

Eeesh!  I hate those ones where people say "This is not a refusal to pay..." and then goes on with a bunch of regurgitated stuff that makes up a validation form letter.  Do you think I would ever tell a company that isn't owed a dime and I know it that I'm not refusing to pay?  Oh, heck no!  My letter tells them I REFUSE TO PAY YOUR BS ACCUSATION unless you can prove me wrong!  Then I tell them the documents they need to produce to prove me wrong.

If you don't tell them what they need to produce, they can just skirt by and make whatever claims they want. Many times they will come back with a lame response such as "...there is no basis in law to send you the documents you're requesting...", I'm paraphrasing.  Well, I don't see that often, though I do occasionally.  But what I put in my validation demand letters is a legal citation for each item I'm requesting from them. So when I respond to that nonsense, I call them out and point them to review each case law cited, each federal act cited, each law, state or federal cited, and so on.

A competent and forceful validation letter is critical, folks.  This is power if they sue you or you decide to sue them. I've stated in other posts that validation is the Proof they need to come forward with and verification is the Sworn Testimony that MUST accompany it. They must have both. Without 1 or the other or any of what is demanded, they have hearsay but they don't have validation. Hearsay is inadmissible in a court of law and the courts have said it is incompetent.

So, you either need to learn what to demand and the laws, case law, or whatever appropriate legal ammunition that relates to each item requested to back up your demand, or hire someone who knows how to craft an effective validation letter.  If you don't demand validation, they can continue coming after you. They can continue to furnish on your credit reports. They can initiate a lawsuit against you. 

Demanding validation properly and always responding to their claims and rejecting their false claims is key. One more important thing about validation.  A demand for validation is rarely done with 1 letter. What I mean by that is, it is rare to send one letter and then they respond with a  letter telling you they're closing their file and removing the lie from your reports. These collection companies are getting very bold in their lawlessness, very stubborn, and they require a fight.

You must always respond. If they claim they've already addressed it and further similar communication will be trashed (well not exactly but that's what they sort of mean), you still need to respond.  YOU must be the last one to respond to anything other than "We're closing the file and removing our BS from your credit reports."  

You have a right to demand full validation. Know your rights. Exercise your rights. Fight back and don't back down. Basic bureau disputes don't completely protect you. You need to dispute with the CRA's but you Need to Demand Validation.  If you want someone who knows this game, knows the laws to use to back up the demands, will fight for you, contact me.  It's what I'm good at.  It's what I'm passionate about. I want to see you win this fight! 

You can reach me at futurefico@gmail.com or 951-801-2828

I'd love to fight for and with you. 

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.

Judgments Don't Belong On Your Credit Reports

I am of the firm belief that most derogatory items that are on your credit reports don't belong on there.  You see, if you dispute an item, the credit reporting agencies are required to verify the item.  I wrote in a post quite a while back that verification is only hearsay unless it is accompanied by validation or proof of claim, which would be the documentation.  I'm not just pulling this stuff out of my ear. No, there is case law to back up what I'm saying.

Also, verification according to Black's Law Dictionary is Sworn Testimony.  This testimony can be in a deposition, on the witness stand, or an affidavit, sworn under penalty of perjury and under oath, and notarized. Who can testify?  Only someone with first hand knowledge. Only someone who has the documentation to support the testimony and the testimony that supports the documentation.  This is how it works. One without the other is hearsay and according to the courts, it's incompetent and inadmissible.

Now back to credit bureaus claiming something is verified. Have you disputed something and they said it was verified?  Did they provide any documentation?  Did they send you the sworn affidavit testifying to the accuracy?  Hmmm, I'm guessing for everyone that has disputed with the bureaus the answers are Yes, No, and No again!

Have you disputed a judgment and you know it's not accurate?  The amounts are not always accurate. The dates they report are not accurate, usually.  But bigger than those things, is the fact that they come back claiming "Verified" when there are only 3 entities that can verify according to Black's Law Dictionary and case law directly from quite a number of courts. You can verify it - and surprisingly many people actually unintentionally do that when they dispute a judgment. The plaintiff can verify it. And the court/judge has the capability to verify it but that is against the law for them to communicate with the bureaus regarding a specific consumer/case.  In fact, Equifax got slammed a little over a year ago in Chakejian v. Equifax and the court said they cannot claim the court or any government agency furnished information or verified information pertaining to a public record.

The bureaus don't get their information from the courts and plaintiff's don't furnish public record information nor do they verify it with the bureaus. What credit bureaus do is hire a 3rd party "vendor" to check the courts' public records and they furnish it and they claim to verify it. Wait a minute!  Do you see the words "3rd party?" Now remember what the courts and Black's Law Dictionary said about verification?  A 3rd party can't legally claim to verify anything because they lack 1st hand knowledge. They're not even qualified to be furnishing the information!

So, now you know why I'm saying that judgments don't belong on your credit reports.  If you have a default judgment, that is considered a "Void Judgment" because  the court lacked jurisdiction.  If you were sued by a 3rd party collector, they lacked and will always lack Personal Jurisdiction over you. No jurisdiction, no valid judgment! 

Of course, if you fought the lawsuit and didn't fight it properly, they will have a judgment against you because you didn't challenge jurisdiction properly and you didn't word things properly in your response and/or testimony in the case.  If you didn't challenge jurisdiction, you gave them jurisdiction and the courts generally are biased and favor the plaintiff.  You have to say the right things and word things properly and challenge properly and effectively in order to win.

It's the same thing when disputing with the bureaus.  You can fight the judgment and dispute and challenge the judgment with the bureaus, but they are liars, cheats, lawbreakers, and are biased in favor of the companies that pay them.  Judgments should come off easily because they cannot truly be verified. But if the language is not correct, its a 50/50 shot.

There are things you can do in preparation for disputing and I've talked about that on other posts.  These things will give you a little more leverage and help you get them removed.  But if you want someone with over 30 years of experience, who knows the exact verbiage that has given me a 100% success rate of removing the judgments from credit reports, contact me.  I can help you get them off.  I can help remove your judgments whether they are paid or not. Usually after doing some prep work, they come  off with the first dispute. Occasionally the bureaus push back a bit and we have another go at it but as of the date of writing this article, the success rate is 100%.

I want to help you remove these judgments from your credit reports. If you're running out of time to remove these or have been told pay a judgment showing on your credit reports in order to get a car or mortgage or a place to live, or a job, or a promotion, I know how to get them off your reports quicker than most companies, and quicker than disputing it on your own.  The verbiage I use is effective. It is proprietary. It works.

Call or email me today so I can help you get these off your reports and on with your life.  7 years is too long to suffer because the bureaus prefer to be thugs to consumers than to aid them with accurate, verified reports.  Fighting for 6 - 12 months or longer to get the bureaus to remove them when you need to close escrow in 45 days is too long. Let me help.  It's what I'm good at, what I'm passionate about, and I want you to be able to get the things you need that these judgments on your reports are preventing you from attaining.

My phone number is 951-801-2828 and my email address is futurefico@gmail.com. Contact me right away to allow me to help you start getting your life back.

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.

Repair Your Credit Before Buying Or Selling A Home

We're coming up on Summer and that is usually a hot time for buying or selling a home.  You need to consider the shape of your credit before you take the leap to either buy or sell real estate. It might seem like it doesn't matter how your credit is when you are selling your home but believe me, you are a prime target for the collection vultures. They're definitely preying on potential buyers but sellers usually have equity and they want to get hold of some of it as well.

For sellers, you're not going to be able to hide the public records like tax liens and judgments. The title company will almost always force you to pay those off before they will allow you to close escrow.  You may also get hit with claims from creditors and collectors that get wind of your transaction.  It's not hard for them to find out that you are selling your home so you really need to take care of your credit issues before you open escrow, and preferably before you even list your home for sale.  

Many times sellers are also going to be buyers. Again, you will want your credit in the best shape possible.  Even if your new lender doesn't require you to pay off certain alleged debts prior to funding, getting these things either paid or off your credit reports is most likely going to raise your credit scores, which will give you a better loan rate and save you thousands - even hundreds of thousands of dollars on your home loan and possibly other credit down the line. 

Some lenders will approve you for a loan with a mid FICO score of only 580. That is typically an FHA loan. However, debt to credit and debt to income ratios play a part in qualifying for a loan.  The higher your score, the better your interest rate. The less debt, and yes that includes 3rd party collector debt, the better your ratios are going to be. Many times your lender will tell you to pay off  the bad debts showing on your credit reports.  That's not necessarily the best advice, many times it is bad advice, but then again, they don't know credit repair the way a professional credit repair expert knows it.

I HATE, HATE, HATE anyone having to pay a 3rd party collector anything!  If you've read even just a few of my blog posts, you'll know that and you'll know that I stand firm in my claim that you don't owe a collection company a dime!  This is one of the main reasons that if you are contemplating buying or selling a home in the near future and your credit is not perfectly clear of these types of accounts, you need credit repair help soon.  You may also be in a position to need to rebuild your credit as well. This is where getting together with a professional credit repair consultant can really assist you in getting ready to buy a home.

Two other main items to address before buying a home are tax liens and judgments.  These are public record items but many times lenders don't pull public records reports on borrowers. So, if they are showing on your credit reports, you want to get them off. Otherwise, your lender might make paying them off a condition of  funding your loan.  Again, removing these types of items are where hiring an expert to assist you really helps you save many thousands of dollars.

I don't worry too much about removing bankruptcies from credit reports. It's not like you can hide the fact that you've had one (or more) in the last few years.  You have to disclose that on the loan application.  If you don't disclose it, you run the risk of being accused and possibly prosecuted for bank fraud. Don't go there.  

Bankruptcies are VERY difficult to remove from credit reports. You have to disclose the fact that you've had one when you apply for a home loan, so I just wouldn't worry too much about removing them.  Yes, attempt to remove them, but don't feel defeated if it doesn't come off.  At least it's not like a collection, tax lien, judgment or charge off showing a balance that might need to get paid in order to close escrow if it's showing on your credit reports.

Interest rates on home loans are still pretty decent but they're not going down; they're going to be going up. Now is the time to get to work on your credit if you're thinking of buying or selling a home in the near future. If you're thinking about buying in less than a year, then its probably best to hire someone to assist you. 

If you're needing to move and you're going to rent, if your credit has collections and public records, you are in the same position as a potential home buyer.  Landlords want to rent to people that have good credit. If they see you have tax liens,judgments, collections, charge offs with a balance higher than $0, they're going to choose to rent to someone with better credit  than you.  Your score will also reflect a lower number as well and that is a turn off to landlords.

 Credit repair is what I've done professionally for over 30 years.  My business partner has done credit repair for over 20 years.  We've taught other credit repair companies how to do it successfully. We are true experts. We want to help you purchase your home.  We want to help you keep the equity your home has earned.  We want to help you be able to rent your next home.  We want to help you. 

If you're ready to get your credit reports looking much prettier and your credit scores higher, we'd love the opportunity to help you reach your goals.  Email me today. Let us get you into your next home!  My email address is futurefico@gmail.com if you would like to contact me directly. You can also go to our website and fill out the form to get started with a free consultation. Just go to InsightCreditGroup.com so we can fight for you.

Getting Collection Accounts Off Your Credit Reports

Getting rid of collections from your credit reports is one of the main goals of credit repair.  They are very damaging to both your perceived credit worthiness and your credit score. They used to be one of the easier tasks to complete even if you really didn't know too much about fixing your credit.  But that is not the case anymore.  Sometimes they are as stubborn to remove as charge offs and they take a lot more work than in years past.

Collections, based on who the 3rd party company is, who the original creditor is, what type of alleged debt it is,and other factors can drop your credit scores overnight to a score that will prevent you from qualifying for a home loan, car loan, credit cards, even from renting, and even other important needs or wants, such as employment, promotions, and a whole slew of other things that can affect your life. My partner and I have seen our clients' scores drop up to over 100 points with a new collection but typically in the range of 40 - 80 points. 

You have to attack collection accounts vigorously and consistently in order to remove them. You have to be careful the way you say things when you are disputing to avoid verifying the alleged debt for them. This is true when disputing with credit bureaus and also with the collection company.   You must choose your words wisely. You must NEVER admit you owe a collection company anything and never admit you owe the original creditor that is related to that collection account.

For the best chance at successfully getting rid of collections, you need to dispute with the credit bureaus and the collection companies. If you want to get them deleted from your reports you need to have bureau disputes that attack in multiple ways to avoid getting a "frivolous" response letter.  You will also need to demand validation directly from the collection company. You may need to do several "rounds" of letters to both of these entities before you see the results you're looking for.

Demanding validation is important for several reasons.  Once you demand validation, the FDCPA requires the collection company to cease all collection activity until they validate.  However, there is NO LAW, not even in the FDCPA that requires a collection company to validate.  What this means is  that if a collection company does not validate, they can no longer furnish or verify information on your credit reports.  They are required to delete the information.  They are no longer allowed to send you a bill.  That's obvious collection  activity.  They are not allowed to initiate a lawsuit against you either if they haven't validated.  The bad news is that many of these collection companies don't give a rat's whiskers (thought I was gonna say something else, huh?) about the law and they ignore it, violate it, and continue their illegal collection activity.

Validation can eliminate the alleged debt if the collection company obeys the law. This happens quite often when you write effective letters.   But even with effective letters, many companies give up their pursuit of you but try to recoup some money by selling the account to another collection company.  The more this happens, the easier it usually gets to remove each new claim for that old account. However, sometimes you slam them so hard and so effectively that you eliminate that alleged debt and never have to see anything related to it again.  That is the ultimate success you are looking for.

Successful disputing also requires you to consistently respond to their replies to your disputes. You can't drop the ball.  You MUST respond and you must respond on point. In other words, you have to attack what they say, what documentation they provide, what they don't provide, and properly rebut any claims they make that they have verified or validated the account.  A good arsenal of laws, case laws and other legal citations to back up your demands and your rebuttals helps to knock them down and kick them out of your life and off your credit reports.  I think this is probably where I see most people get hung up, stumped and start to give up.

Credit repair is not as easy as a lot of people think! Sometimes it feels like a full time job when you are doing it on your own. My partner and I have been doing this for over 50 years combined. We are the best of the best at what we do. We have other credit repair companies calling and asking for our assistance because they are frustrated with their clients' progress sometimes. And you know what? It's sometimes hard for us too so we know that you can get frustrated, worn down and feel like giving up.  Fortunately, we love fighting, love seeing great results for our clients, are passionate about what we do, and heck, its our job so we don't give up.  

You need to hang in there, keep fighting, keep responding, keep demanding proof, documentation, etc. Your credit depends on it. Your ability to rebuild your credit, improve your scores, qualify for credit, loans, get employed, etc. depend on it. 

If you get too worn out, burned out, frustrated or tired, please reach out to me. This is what I do.  If you don't even want to attempt it on your own for whatever reason be it lack of  time, fear, or you just want to let a professional assist you, please contact me. I will audit your reports and my partner will give you a consultation. We will answer your questions and give you a realistic projection of what you can expect our services to achieve for you. 

You can contact me by email at futurefico@gmail.com or go to our company website at InsightCreditGroup.com and sign up for a consultation.  I look forward to helping you achieve the credit you desire!

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.

My 3 R's For Disputing 3rd Party Debt Collections

Although I have several articles on this blog dealing with how to fight back against debt collectors, I still get a lot of emails and calls asking for assistance with collections whether it is how to demand validation, how to follow up, is what they got validation, etc.  I don't have time to write letters for everyone that calls and emails me for help.  I can't do that as it wouldn't be fair to my clients that hire me to help.  But, for those of you DIYers, I'll try to answer some questions here and give guidance to help you have more success.

In the credit repair world, we all used to want clients with a bunch of collections to remove.  They were always the easiest derogatory item to address and see success on. But times have changed.  Collection "accounts" are not always easy to remove anymore.  Quite the opposite. These companies have become obstinate, stubborn, still liars, but just defiant really.  They don't validate yet they refuse to remove their slander from reports as quickly as they should.  Some just flat out ignore you or refuse to remove unless you sic the big dogs on them or launch a lawsuit against them.  So I understand the frustration.  Hopefully the following information will help you get even better results.

Let's discuss my 3 R's you need to ALWAYS do with these thugs.  This means you do them with the first correspondence you get from them (Dunning Letter), every response you get from them when you have done a bureau dispute, and every response you get from validation demands and follow up letters you send to them.

1.  RESPOND

You absolutely ALWAYS need to respond to them.  If it's a 30 day initial period in which you can dispute their claim then do it within 30 days. Tell them you are exercising your right to dispute their alleged claim and are demanding validation.  If it is a response from a bureau dispute that says something to the effect of  "We received your dispute from a CRA and have investigated and our records are accurate and blah, blah, blah - we're marking it as disputed" you need to respond. 

If it is in response to a demand for validation and they do not tell you that they are removing it and closing the file, you need to respond. If it is a response to your follow up letter or your response letter, you need to respond. YOU ALWAYS NEED TO RESPOND! If it is a letter claiming that they can't determine the nature of your dispute or that it is frivolous, you need to respond.

2. REJECT

You always need to reject their claim that they validated or verified something.  You always need to reject that their records are accurate. You need to tell them that they failed to send what you requested which means they failed to validate.

Some generic letter saying they investigated and their records are accurate is not validation nor anything close to validation.  It is an unsubstantiated and reckless claim that amounts only to hearsay. They are liars. Are you going to take their word for it without any proof?  I sure wouldn't.

Sending a long detailed medical bill from the original medical facility is not validation. It is a list of services and charges from someone other than them.  That needs to be accompanied by a contract between you and the collection company with your signature and their representative's signature on it.  If they include the admitting form with your signature saying you'll be responsible, well, that was between you and the medical facility, not you and the collection company.

Even if you checked the box that they could share your information and that they might forward it to a collection company, unless the company that is trying to collect is specifically named in the original contract, you are not liable to them.  You have the right to choose who you decide to do business with. It's contract law. Without a contract showing you agreed to do business specifically with that company, they have nothing and you owe them nothing.  Reject that claim!

Sending old billing statements from a credit card company is the same thing. Its not validation. Where is the recorded assignment from the original creditor to them?  How much did they pay for your information? Notice I did not say your debt.  They did NOT purchase any debt. They purchased your information and it usually comes on an excel spreadsheet accompanied by a few of the final billing statements around the time the original account was charged off.  They are missing a big piece of the documentation though.  Where is the contract showing that you agreed to do business with them specifically?  Reject that claim!  Without a valid, bilateral contract (2 signatures, 1 from each party), they do not have a valid claim and they don't have validation.

Whatever a 3rd party collector sends you, no matter if it's a whole stack of stuff, it is NOT validation.  They MUST be able to produce a contract between their collection company and you. That is the vital document that establishes a claim and seals validation. They don't have it! REJECT, REJECT, REJECT THEIR CLAIM.

3. REFUSE

Every contact they make with you telling you that you owe something is an offer to contract with you. Refuse to contract with them.  Tell them you do not do business with collection companies and you don't pay companies that you don't owe. You're not going to start now and you refuse to contract with them.  

Why would you agree to pay someone that you don't owe and that can't prove they have any valid business agreement in place with you? I wouldn't.  Refuse their demand, refuse to contract with them. Again, everything is contract law.  In fact, when they claim they have a valid contract because they purchased the account with all rights of assignment and interest, you need to reject that immediately and throw 73 AmJur 2nd, sections 90 and 93 in their face.  This is Supreme Court case law!  

73 AmJur 2nd, Sections 90 and 93 state that they cannot substitute onto a contract unless they have an interest to protect.  That means that they have to be clearly and specifically named on the original contract to have an interest to protect.  Further, it states that they are a "Stranger to the transaction" and a "mere volunteer."  It is saying that you don't owe them.  They do not qualify for subrogation, which is substitution, under the Doctrine of Subrogation.  They are not qualified.  Don't go and agree to pay them anything. Instead, be very clear and Refuse to Contract with them.

3rd party collectors have no valid claim against you.  They have no contract with you. They cannot truly validate their claim. They have no interest to protect. They didn't buy any debt from any company, they only bought account information about you without your knowledge and without your consent and definitely without any business agreement in place requested by you.  That is the only way that they can substitute onto a contract they have no interest to protect, is by you requesting their assistance to pay off the alleged debt and you would then agree to be responsible to them. CONTRACT LAW!  It is what you have protecting you.

So, always respond, always reject their claims of owing them something and false claims of validation/verification, and always refuse to contract with them.  

If you are tired of dealing with these liars, thieves, scum sucking, extortionists called 3rd party collectors and debt buyers and are tired of the back and forth fight you have to stay on top of, I would love to assist you in the fight.  My partner and I have been at this successfully for 50 years combined.  In fact, this month I am celebrating my 30th year in the industry. I love the fight and am passionate about helping others get rid of the bad credit that is holding them back.  I get tons of emails about how my assistance has helped people get jobs, buy homes, cars, and start over.  I would love the opportunity to help you too!

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.

How To Write Bureau Dispute Letters - Part 2

I am very late at getting out this post and I am truly sorry.  I have been swamped with my own clients' letters and real estate duties and just haven't had the time to get to this.  Please accept my apologies for the long delay.

Let's get to the bureau disputes.  We will cover charge off's collections, repo's, foreclosures, settled accounts, accounts included in bankruptcy (IIB), and public records.  One thing that is important for you to know about some derogatory accounts is that some are not worth disputing.  Take charge off's for example.  If they are reporting a $0 balance, I don't bother with them.  I'm telling you that in more cases than not, if you remove them, your score will likely drop.

Accounts with $0 balances, even though derogatory, usually have more positive attributes that affect the score than the negative aspects, so they offset the damage that is being done.  Deleting them removes the good factors and the bad factors but because the good outweighed the bad, your score will drop.  We see this time and time again for clients that are adamant about removing old charge offs and settled accounts with $0 balances.  We warn them, we advise against it, but if they insist, we go after them and when we start seeing them removed, we see the score drop pretty much every time. I personally think that a higher score is more important than a totally pretty credit report.

Collections:  Always negative and I don't care if the balance is $0, I'm going to go after deletions on these.  Typical disputes are as follows:

• (Round 1) I do not have any account with this company, have never heard of them and this needs to be deleted. 
• (Round 2) You told me to contact this company and I have done so. FDCPA 809b requires this to be deleted until they validate.  I have requested validation and they have not produced it. Delete this now.
• (Round 2/3/4...) Please produce the contract used to verify this account because I have none with them and the information you have is inaccurate.
• Please provide the sworn affidavit used to verify and the accompanying documentation as required pursuant to Black's Law Dictionary which defines what "verification" actually is.  ~ then I copy/paste the definition of  "verification" to the letter.

Charge Off's:  This is only for accounts showing a balance, past due or both.  Typical disputes are as follows  - Do not dispute all the errors at one time. Dispute them 1 at a time, round after round:

• (Round 1) The balance (and past due/or past due) on this account is incorrect. It should say $0. I do not owe any monies to this company for this account. Please correct or delete this.
• (Round 1 or subsequent) You are allowing an inaccurate history of this account to be reported.  Please investigate, gather documentation proving accuracy, or delete this from my credit report.
• (Round 1 or subsequent) This company does not have any information to verify as they have reported over and over in the history that they have "No Data (ND)".  As this is unverifiable, FCRA Sect. 611 REQUIRES you to delete this.
• (Round 2 or subsequent) This is not verified. I contacted the furnisher as you told me to do and they have either refused to provide any documentation or they are unable to provide documentation proving the claim or the accuracy.  This remains inaccurate, incomplete and not verified. You are REQUIRED to delete this immediately according to FCRA Sect. 611.

Repos:  Many times you will have a repo auto loan account that has a balance because of a "deficiency" remaining after they sell the car.  I treat these as charge offs and dispute the same way but some times add a little twist.

• (Round 1) You are allowing this company to furnish an incorrect balance.  The balance needs to show $0 because this account was paid in full by the asset protection insurance attached to it. Please correct to $0 or delete this account immediately.
• (Round 1 or subsequent) Please investigate the history reported on this account. It is absolutely inaccurate. Correct or delete this immediately as anything inaccurate about the information they have furnished requires correction or deletion according to FCRA Sect. 611. Take care of this immediately.
• For Repo accounts with a $0 balance I suggest that you send the company a notice to Cease & Desist ALL communications regarding the account. Advise them that furnishing or verifying information with credit bureaus is considered a "communication" according to the courts and a violation of your C&D notice.  For these types of repo accounts, once you have issued your notice to them your dispute should be as follows:
• (Round 1) I do not have any account with this company and they have been issued a notice to Cease and Desist all communications with you.  Please delete this account immediately!

Foreclosures:  Sometimes foreclosure accounts will have a balance.  This is an obvious error. Dispute this as follows:

• (Round 1) This account is inaccurately and erroneously reporting a balance that they know should be $0. Their intentional and willful furnishing of inaccurate information is a violation of FCRA Section 623 and according to FCRA Section 611 you MUST correct or delete this immediately.
• (Round 2) I have contacted this company and requested the proof that they are reporting accurately.  They have failed to provide it within the 30 days the law allows them. This is inaccurate and unverified and you are required to delete this according to the FCRA. I expect you to comply with the law and remove this slander immediately!

Settled Accounts: For all settled accounts that are original creditors (except for repos), leave it alone!  For collections, send them a full Cease and Desist (C&D).  Then follow up with a bureau dispute that says:

• (Round 1) I have no account with this company nor have I ever signed any contract to do business with them. They have neither lent me anything nor have they provided services to me for which I requested.  They are under an order to Cease and Desist and accordingly, this must be removed from my credit report immediately.

IIB Accounts:  Because a bankruptcy obliterates all debt, you no longer have any account with the creditor. It has been eliminated. If you had a bk that was dismissed, no account was in a bankruptcy because according to the courts, a dismissed bk is the same as never ita bk at all. Sometimes they erroneously report a balance as well. Dispute as follows:

• (Round 1) I do not have any account with this company. Please delete this.
• (Round 1) This account claims it was included in a bk. If that were true, which it is not, this would be violating the federal bk stay. Delete this immediately.
• (Round 1) This account is erroneously claiming I owe them money, which I do not. This is an error and according to the FCRA, inaccurate information must be deleted.

Public Records:  Hopefully before you dispute these you have removed any addresses associated with it, especially bankruptcies. Do not send the court clerk or county recorder letter yet.  You may send the FTC staff opinion letter with the first round if you would like.

• Bankruptcy (Round 1):  Your information is inaccurate. I do not recall having a bankruptcy on the dates you are reporting and there are blank fields making your information incomplete as well. The FTC has publicly stated that your public record information is often inaccurate, which is the case in what you are allowing on my credit report.  Delete this immediately!
• Bankruptcy (Round 2): You are big, fat liars!  You claimed that you verified this and told me to contact the furnisher. You claim that the court furnished and verified the information. I did as instructed and they gave me a letter claiming that they neither furnished the information nor verified the information. They are the only ones qualified to make a verification regarding this alleged bankruptcy and they did not verify. You are allowing slander on my credit report.  See the attached letter from the court proving that you are allowing erroneous information on my credit report and are falsely claiming that it is verified. Your butts need to be sued if you do not remove this from my credit report. It is inaccurate, incomplete and NOT VERIFIED! Delete this immediately!

• Tax Liens (Round 1):  I have NEVER had a valid tax lien. Further, according to my state statutes/the IRS (pick one), taxpayer information is confidential and not allowed to be on any taxpayer's credit report. (if you know your state statute, insert it in your dispute). You need to get this crap off my credit report immediately as it is inaccurate and damaging to me and may be actionable for statutory damages, actual damages, and punitive damages. Delete this NOW!
• (Round 2): Please see the attached information from the county recorder which you claim furnished and verified this tax lien.  It proves you are huge liars. How do you get away with this stuff and how on earth do you sleep at night? You should be in jail for causing injury to consumers. This was neither furnished nor verified by the county recorder. Get your false information off of my credit report now!

• Judgments: Even if you have had a judgment, you can demand that they verify it and since they are accusing, the burden of proof lies with them. If you have a default judgment, it is not a valid judgment, it is a "Void" judgment and carries with it the right to challenge it at any time. In order for a judgment to be valid, the case must have at the trial a plaintiff, a defendant, subject matter jurisdiction (which can be challenged at any time) and a competent witness (sworn affidavit by a witness with first-hand information that testifies and produces the accompanying documentation to back up the testimony).
• (Round 1): I am not aware of any judgment against me for $XXXX. I do not believe you are furnishing accurate information and I need you to investigate this and provide the documented proof that your information is 100% correct. Otherwise, please delete this immediately.
• (Round 1):  I do not have a valid judgment against me. You are allowing false information on my credit report. Delete this immediately.
• (Round 2): I have proof that you have lied about verifying this bogus judgment. The only persons qualified to verify it is the court or me, and I can't verify it and they claim they didn't verify it. See the attached from from the court proving that you have lied and that this remains unverified. The FCRA requires that this be deleted until you get proof from the court exclusively that this is mine - which obviously it is not!  Delete your inaccurate, incomplete, and unverified information immediately!

Okay, this should provide you with a really good start to cleaning up your credit report.  I cannot guarantee that any or all of these disputes will work every time because you are relying on two other parties per account to obey the law. Unfortunately, creditors, collectors and credit reporting agencies have notorious reputations for ignoring the law and doing whatever they please.  I do hope that you will see more success using some of these disputes than you have been getting or that most people get using boiler plate disputes.

Please remember never, ever to admit anything to a credit bureau.  It is THEIR JOB to get the proof and it is the furnisher's job to provide you with the proof (which is why I dispute with both the bureaus and creditors/collectors). I never, ever advise sending proof of a paid tax lien, paid judgment, or bankruptcy paperwork to the CRA's. If you do, you are giving them what they need to keep these public record items on your credit report for a full 7 years after that event.

If you decide you don't want to do this on your own, I would love to assist you with your credit repair. Also, if you have trouble removing tax liens or judgments, paid or not, we have an escalated proprietary process that can help.  By law, we are not allowed to guarantee any results, however, we do have a 100% success rate removing them.  We would love to assist you with removing them if you would like us to.

Best wishes for your credit repair venture. You can be successful so don't believe the naysayers that claim ugly credit has to stay on your reports for 7 years or more. That's an ignorant statement and totally untrue. Whether it's accurate or not, the furnisher has the responsibility to prove it and the bureaus have a responsibility to maintain maximum accuracy.  If it can't be proven, a claim of accuracy should not be made by anyone.  Also, you may think it's accurate and you may think you owe monies, but I'm here to tell you that you that you have been deceived.  Your contracts with creditors were never truly valid and no 3rd party collector has a lawful claim against you.

Stand up for your rights.  Fight hard for your credit to be repaired. You are to be congratulated for taking the steps needed to get your life and credit back!

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.