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.

Removing Default Judgments From Credit Reports & Public Records

Have you ever gone and applied for credit or pulled your credit to qualify to buy a car or house and the finance manager or loan officer tells you that you  have to take care of a judgment in order to qualify and you say, "What judgment?"  I hear it quite a bit. This usually happens because you got sued and never were properly served. I see this happening a lot to people who have been sued by 3rd party debt collectors.

If you've read much of my blog, you know that I absolutely loathe debt collectors. These companies are the scum of the earth.  They have no business meddling in your life. They play dirty, violate the law, and should never get a dime from any consumer.  What is really rotten is when they sue you.  They file a lot of lawsuits because they know that most consumers will not fight back and they get default judgments.  If they think you might be a fighter, or they just don't want to take the chance of that, many times they will improperly serve you a summons and complaint or not even serve you at all. If you don't know about the lawsuit, you won't fight it and they'll win by default.

Courts do NOT furnish these judgments, or any judgments for that matter, to your credit reports. They don't verify them with the credit bureaus either when you dispute them.  These are furnished to the bureaus by data diggers. They scour the public records to find new public records and I believe they are paid to furnish them to the credit bureaus.  These data diggers are considered "Vendors" by or to the credit bureaus and they are the ones who both furnish and verify the disputes with the credit bureaus.

This really pisses me off because they are not qualified to do either of these things and when you demand that the bureaus give you the contact information for the person who verified, they lie and give you the court's address and contact info and never expose the true furnisher of the information nor who claims to have verified the information.  I say that they are not qualified because in order to verify something, you have to have first hand knowledge and the full documentation to back it up. They have neither.

But let's talk about how you remove them. Before I explain the following process, let me state that paying off a judgment does not make it come off your credit report. When you are repairing your credit, you will dispute the judgment with the credit bureaus.  You need to give a specific error.  You can say things like, I have never had a valid judgment for $xxx.  Or, I didn't lose any lawsuit on 1/1/01 or whatever date they are reporting.  You need to spin it if it looks sort of accurate.  You can challenge the court location, dates, amounts, plaintiff, missing information, inaccurate information, even the age being obsolete if its too old to even be on a credit report. You must be VERY CAREFUL not to admit anything about the judgment.  Use "I don't recall..." if you have to but don't even hint at admitting to it.

At the same time you are disputing with the bureaus, send a letter off to the court requesting their method of furnishing information and verifying information with the credit bureaus.  Do not get specific. Do not include your social security number. Do not include any case numbers. Do not reference ANY specific case.  You are only inquiring about whether or not they furnish information and verify information with the credit bureaus.  Make sure you include a self addressed stamped envelope so that they can send you a response quickly.

You should have the response from the court back before you even get your bureau responses back. This is most of the time.  Sometimes courts fail to respond.  When this happens, I think that there's a clerk or court employee that is intentionally trying to make it difficult for you to remove your public record items because they believe you deserve it.  I'm just very suspicious of them like that. I like to see the good in people but I've seen so much that I just have a hard time giving them the benefit of the doubt.  Anyhow, hopefully they will answer your inquiry properly so that you will have some good ammunition for your next round of bureau disputes.

Hopefully your bureau disputes will come back showing that the judgment has been deleted.  But if it comes back as "Verified", you will need to do another round.  This time, your dispute will be, you told me to contact the court regarding the verification of this item. Please see the attached letter I received from the court when I did as you told me to do. They had nothing to do with this information and they certainly didn't verify it.  Please either give me the contact information of the liars who claimed to have verified this or delete it.  Make sure you have attached a copy of the letter from the court and you can also include an FTC staff opinion letter that I use and highlight, that states bureaus are allowing inaccurate public record information on credit reports.

This time, your bureau responses should come back showing the judgment deleted.  But, sometimes they do, sometimes they don't. Bureaus will occasionally claim they can't use the supporting documentation that you sent with your dispute and its still verified.  Even though the correct and lawful response would be that it has been deleted, unfortunately, bureaus are big lawbreakers too.

We are moving on now to the next section. Whether or not you removed your judgment from the credit report it will still be in the public records.  If you are buying or selling property, when they do a Title search, they will find this judgment and underwriting for your mortgage may require that you pay it off as will escrow for sellers to be able to close.  Credit repair does NOT remove the judgments from public records.  But, getting the judgment vacated with the court sure does!

Now, this is good for everyone who hasn't been able to get it off the credit reports.  I also want to reiterate that this is ONLY FOR DEFAULT JUDGMENTS!  Removing a judgment from a public record should cause your next dispute to the bureaus to finally delete it off your credit reports.

DISCLAIMER:  THIS IS NOT LEGAL ADVISE!! THIS IS "HOW TO" INFORMATION BASED ON MY OPINIONS, MY EXPERIENCES, RESULTS FROM PUTTING IT INTO PRACTICE AND MY KNOWLEDGE GAINED FROM RESEARCH AND PRACTICAL APPLICATION RESULTING IN CONSISTENT SUCCESSES ONLY. I AM NOT CLAIMING TO BE A BAR ATTORNEY. (I refuse to stoop to that level or be insulted to that degree).

You will need to get the judgment vacated at the court level. This means you will need to file a Motion to Vacate and Set Aside the judgment, and Motion to Stay the Execution of the judgment. You will also need an Answer to the lawsuit which will be entered as an attachment to your Motion to Vacate.

Court rules vary from state to state and county to county. Sometimes courts have rules specific to that court.  There are 2 arguments that can be raised to get a judgment vacated.  The first one is the one most often used and pretty much the only one that an attorney would use. It is a Motion to Vacate for Lack of or Improper Service.  What this means is that you weren't served at all or they didn't serve you properly.  They may have served the wrong address. But for whatever reason, you were not timely and properly notified that you were being sued.  There is also an argument to be made that you were in the hospital at that time or out of the state/country, and didn't get served properly.  They may have done what is called "Substituted Service" because they weren't able to serve you personally.

You will need to pull the full case file and buy a copy of everything in that file. You will want to see the Summons and Complaint (sometimes called a Warrant of Debt), the proof of service, any affidavits that were included, and anything else in that file.  You will be using these items and the information they contain, especially in their Complaint, which has "Causes of Action" to form your defense for both your motions and your Answer.

Remember I talked about court rules?  Well, its very common to see a deadline to file a Motion to Vacate within 6 months of discovering that you had a judgment.  So, when you find out about it and you want to use this defense, you will usually need to get your motion filed into the court and served upon that plaintiff within 6 months.

Now the 2nd argument that can be raised to be granted a Motion to Vacate, and again, this is ONLY for DEFAULT judgments, is the court's lack of Jurisdiction. A default judgment is considered a "Void" judgment and it can be challenged AT ANY TIME - There is NO Statute of Limitations to challenge a default judgment.  The court lacks jurisdiction because there are 4 requires items for every case.  A Plaintiff; A Defendant (Whoops, that was missing); Subject Matter; and A Competent Witness.  

When the court grants a default judgment, there was No Defendant. That means the court lacked Personal Jurisdiction.  If when you pull the file you find that the Plaintiff didn't include an affidavit from a "Competent Witness" (one who has first hand knowledge and is qualified to testify - not hearsay!), then the court also had no Subject Matter Jurisdiction.  Also, subject matter jurisdiction can be challenged at any time and the case cannot move forward until the PLAINTIFF establishes, proves it.

Here is the beauty of vacating default judgments, especially when using the argument of the court's lack of jurisdiction. As I stated, default judgments are Void judgments and can be challenged at any time with NO statute of limitations.  What this means is that if you look at the Date of Last Activity for the original account, and had there not been a judgment it would now be outside that Statute of Limitations for debt, once that judgment is vacated, that debt is now considered Time-Barred and they can't come back and sue you again!  While a judgment is active, they can pursue payment until the statute of limitations for judgments expires.

So keep in mind these Statutes of Limitations:

State statute of limitations on debt is based on the Date of Last Activity (when you last made a payment.

State statute of limitations for judgments - based off the date of judgment and runs for usually at least 10 years but it varies by state.

Statute of Limitations for vacating a Default Judgment - ABSOLUTELY NONE!

So the moral of the story here is, be excited for default judgments. If you get sued, even served properly, but are not prepared to fight and doubt you could win (you probably could if you knew how to fight it properly), don't be afraid to get that default judgment.  You have the ability to reopen the case when you are ready. vacate it, and if you can hold off the vultures trying to collect on that judgment until the debt statute of limitations has passed, you can totally get rid of it from the public records as well as your credit reports.  

Oh, PS.  It is much more wise to vacate a judgment than to file a bankruptcy to get out of paying off a judgment.  Filing a BK will add 10 more years of crap credit to your credit reports and they are a pain in the butt to remove. Save those BK filings for emergencies such as one of your strategies for avoiding foreclosure. By the way, if you are facing foreclosure and want to fight, you can contact me for a referral to a friend of mine who is massively successful, its what he does for a living, and just so you know that he knows what he's doing, he's been in his house now without making a payment for over 11 years. 

If you would like someone to help you remove your judgments from your credit reports, I can help you with that. Though it is illegal to guarantee results, my partner and I do use an escalated and proprietary process that generally removes them in approximately 30 days and we have a 100% success rate.  I would love to help you remove your judgments, your tax liens, your collections, etc. and help you raise your scores so you can have that fresh start you so deserve! You can find my contact information on the top right of this blog. Both my email and phone number are there for you to reach out to me.

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.

Pitfalls Of Paying Late On Credit Cards

Before February of 2009 there was this horrendous practice by creditors called a "Universal Default" that could catapult you into credit devastation.  The main practice was if you were to make a late payment to one creditor, all of the rest of your creditors could hike your interest rate to oblivion (okay, a little exaggerated but pretty common to see around 30%) even if you had never been late on those cards or credit extensions.  They would repeatedly be checking their consumers' credit reports for these late pays and then swoop in like vultures to reap the financial paydays they were allowed to render on mostly unsuspecting "debtors."  They could raise the interest on both current and future purchases, making the interest hike RETROACTIVE!  It may have been legal, but it certainly wasn't ethical or moral.  But, since when are banks or creditors ethical or moral? You should know by now that its always about money and profit to them.

Well, in February 2009, there was new legislation that went into effect that claimed to prohibit this practice of  "Universal Default."  I say claimed because, typical of anything that affects banks or lenders and is within reach of unscrupulous lawyers, there's going to be lobbying and backroom deals to make sure that any legislation would have plenty of loopholes and spin to still stab the consumers and rake in the money for them.  The legislation is called the CARD Act (Credit Card Accountability, Responsibility, and Disclosure Act).  It was supposed to protect consumers more and rein in the creditors a bit.  It was touted as the end of  the "Universal Default" practice.

So here we are now and there's no more Universal Default.  Except, there kind of is, its just that they call it by different names and it plays out a bit different.  Here's how the CARD Act works.  If you have a credit card, or credit line, whatever, some sort of credit agreement with a lender, and you've become 60 or more days late, they can hike up your interest rate if they want to (and you know they want to), to however high they want - there is no cap on the amount they charge for a "penalty interest".  However, under this act, if you are good little children and pay your bill on time for the next 6 months in a row, they have to restore your interest rate back to what it was before you got behind.  They also can't raise your interest rate based on your performance on other credit obligations. Kind of sounds like they care about us consumers doesn't it? 

Don't be fooled.  Those are about the only "good" things for consumers in this legislation.  How about this:  You are one of the best of the best.  High FICO Scores, never late, pay more than minimum, had the credit card for over a year. Can you believe that if they want, they can practically arbitrarily increase your interest rate to whatever amount they feel like?  And the fees -- oh the fees!! They are endless!  They can fee you now if you don't go paperless, or fee  you to pay by phone, or in person, or fee you for the convenience of accepting your payment, or an annual fee, you name it. They can make up all kinds of fees and call them whatever they want, to squeeze every last dime out of you.  

If you're late on a different credit card bill or credit account that is unrelated to them, they can give your situation another name, put you into a category where they can spank you.  So, if you are a bad child and end up as a potential defaulter, they can cancel your account or lower your credit limit, or raise your minimum payment or both the last 2, if they want.  If they raise your interest rate for whatever reason they make up, they can raise the minimum payment to an amount that would allow you to pay off the balance in 5 years.  That could be quite a payment hike!  They do have to give you a 45 day notice for raising your interest rate. But, if they don't raise the interest rate, they can raise the minimum payment as high as they want, and they don't have to give you an advance warning.  They don't have to give you an advance warning if they decide to close the account, either.

So, is there anything else that is "good" about this new-ish CARD Act?  Here's a few.  If they raise your interest rate and you say, "uh, no, you don't deserve my business, cancel the card," they can't make you pay the balance off in full in such short notice.  They have to allow you to make payments and pay it off in up to Five Years.  They can't "penalize" you with a higher interest rate for being late on some other company's card, and they can't raise the interest rate as a "penalty" for being late on their card, unless you are more than 60 days past due.  They have to review your account in 6 months from the start of the "penalty phase" and lower your interest rate back to what it was.  They can't post that you were late making a payment on your credit report(s) until after you are over 30 days late.  They have to keep the same due date every single month.  They have to send you a bill at least 21 days prior to it being due.  They cannot charge you for being late for not paying them midday. The cutoff time has to be at least 5 pm, their time.

So, for those of you that are still using credit cards, make sure that you're not late, at least more than 60 days late because that is when the heavy penalties can take affect.  Just be careful, read all your disclosures carefully, especially for those accounts you've had a long time.  They put those small print, contract changing enclosures in your bills.  You don't want an unwelcome surprise and not respond in time, if you cannot accept their new terms.

If they've already beaten you down and you can't or don't want to pay them anymore, no doubt your credit report has suffered.  You may want to think about fixing your credit.  If its not a job you look forward to, and don't want to handle all on your own,  feel free to call me or email me for some help.  Fighting these out of control creditors and scum of the earth  3rd party collectors is what I completely enjoy.  I would love to help you as well!