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.

How To Beat Debt Collectors At Their Game

Last month I focused a lot on 3rd party debt collectors going after foreclosed homeowners and the deficiency they feel they are entitled to. This month, I'm going to go more into detail on how to beat these collection companies no matter what type of collection account they are on the warpath for money over.

If you receive a notice in the mail from a debt collector telling you that you now owe them for some debt, maybe its a medical collection or a charged off credit card, or even the difference left over after a car repo, it should tell you clearly that you have 30 days to dispute the debt.  If the first contact you have with a debt collection company is that they call you on the phone, you can confirm your name if you want, but do not confirm your birth date, your social security number, your phone number, your address, or anything else.  Do not acknowledge that alleged debt.  Tell them you do not communicate with companies like theirs over the phone and if they have something to say to you, they can put it in writing and mail it to you.

Once you have received that letter, its time to start the fight. You want to immediately fire off a letter disputing the alleged debt and demanding validation.  I go so far as to not even call their account number an account number. Its a reference number.  I do this because there is no way I'm going to acknowledge that my client has an account with them.  This is their own made up account number to try and make you think their claim is legitimate. So, this is where you start to fight back.

Your validation letter should tell them that you are responding to their letter and you do dispute their claims. In fact, you will need them to validate and prove to you that you owe them that alleged debt.  You see, there may be some alleged debt, but do you owe it?  That's what they need to prove.  Don't fall for the lame Chaudhry minimum standard of "verification" of the alleged debt. You don't need verification and they can't provide that anyhow since they are a 3rd party.

You are demanding validation, which is the proof, the documentation that supports their claim.  You are entitled to receive from them a copy of the contract showing you agreed to do business with them. That means that the contract names them as the creditor that actually lent something to you of value, and your name agreeing to compensate them or pay them back for what they claim they lent you.  Then it has to have your signature on it.  A contract between you and the alleged original creditor is not a contract between you and the 3rd party collector and it isn't full validation.

You will also need to tell them to provide proof that they own the alleged debt or that they have been authorized to demand payment, which means its been assigned to them by the original creditor.  Sometimes they will send a bill of sale, and that doesn't happen too often, and occasionally though rare, they'll send you a copy of their assignment. But sending this, even with a copy of the original agreement, is not full validation.

You are also entitled to ask them to provide a full accounting.  This is not just 3 years(or however many they send) of billing statements but also means an accounting ledger. The accounting ledger should show every charge, every fee, interest added, credits, debits, payments, every single event that changed the amount on the alleged account. Billing statements that show what was charged that month is important too because you have the right to say, "Hey, I didn't buy that or authorize that." Leave that for the courtroom though.  We never want to admit anything to a 3rd party debt collector.

You will also want to tell them that since they furnished information to your credit reports, they are required to have your consent to do so in writing, so they need to provide a copy of that consent or authorization.  They won't be able to provide this but this only helps remove them from the credit report. It is not part of validation and will not mean they have to stop trying to collect if they can't produce it.

A couple other things to ask for is proof that the alleged debt is not outside the statute of limitations and if you're in a state that requires licensing and/or bonding, you need to have copies of those documents as well. You also have the right to ask for a full chain of assignment, which means every collector that has ever had it in their possession, and proof that their collection fees are agreed to in the original contract. Heck you can actually even tell them that you have a right to know how much they paid for the alleged debt because that is closer to the phony baloney amount they should be trying to collect.

After you dispute with them and demand validation, you want to write to each of the credit bureaus and dispute each of the collections with them. You will do this about a week or two after you send the letters to the collectors.  This is very important because once you demand validation from a debt collector, they are required to stop all collection activity. Verifying with credit bureaus is considered collection activity and if they do it before they send you validation, they've just broken the law.  They actually need to remove the information they have furnished while its in dispute.  

Many times you will see comments on your credit report saying that "consumer disputes" or similar language.  If those comments are on a 3rd party collection account, that is a violation of law and proof that they are breaking it. Since communicating via the credit report is considered collection activity, putting a "dispute" comment on there doesn't void the fact that they are still trying to collect when they are supposed to stop all collection activity.  Its just proof that they are ignorant of the law or they don't give a rip about the law.  We're going to jump back to bureau disputes in a bit.

Now, when debt collectors respond to your dispute and demand for validation, many times they will send you the name, amount and a few tidbits of information about the alleged original account and then tell you that they have verified.  They haven't, that's hearsay. If they send you any documentation, it might look like they've proved the alleged debt, but its not validation. Its not proof you owe them.

Your response is a very important part of beating them.  You don't want to attack their response until you get the results from your bureau disputes though.  This is because not all of the collectors will usually reply to your demand to validation but they will respond to the bureau dispute by claiming they verified it.  That's a big NO-NO.  You are also going to want to check those bureau disputes and see which collectors were stupid enough to comment that the alleged account is disputed.  You will be using these things against them and this is very effective to make them hit the road.

Now that you've received your bureau dispute results back and the debt collectors that have bothered to respond to your demand to validation are pretty much all back to you, its time to contact the collection companies again.  For those that told you they are closing the file and notifying the bureaus, you don't need to send anything to them.  Just make sure they actually deleted. If they didn't you will dispute that again with the bureaus.  For those that claimed they verified, you need to get real tough with them.

Your response to those who claimed they validated or verified in response to your demand for validation, you need to tell them something like this:  "I've received your letter claiming you have validated (or verified) the above reference number. But the problem is, you didn't provide the documentation that proves I owe you anything.  Where is the contract between your company and me? Where is the full accounting because I can't just take your word for it that I owe some company I've never contracted with, some made up number?  Where is your license and bond?  In fact, from what you sent, I can see that you are trying to collect for something that is outside the statute of limitations for my state (if that is the case).  

You also haven't proved you have any right to be on my credit report because I know for a fact I've never contracted with you nor consented to you being able to make any communication on my credit reports.  You're violating the FDCPA by continuing collection activity and you're violating the FCRA by furnishing information and verifying unvalidated information, disputed information, erroneous information, when no access to my credit reports has ever been granted to you.

So, get your crap off my credit reports until you can provide some proof that I actually owe YOU! You haven't done that yet and by law, you are to cease collection activity immediately.  I reject your hearsay as being validation or verification. I reject the bills you sent as being validation because they are not. I reject any of your claims of validation or verification because you haven't proved anything."

That's pretty much how a follow up letter is written.  Now, for those that verified with the bureaus but didn't bother to even respond to your demand for validation, you should send them a letter similar to what I just gave you but blast them for verifying without even responding to your demand for validation.  You can even tell them that you intend to sue them for their FCRA and FDCPA violations if they don't remove this reference number and information they furnished to the bureaus from your reports.

Now, your follow up letters to the bureaus will be to dispute each one as having demanded validation from each one and they have not validated and therefore are still Unverified so please delete ASAP.  By the next time you get your responses back from the bureaus, you should see some great results.   Sometimes though, they just don't have any respect for the law and they keep leaving their bs on your report. You may need to keep attacking them month after month to remove these stubborn ones.

I hope that those of you who are working to improve your credit will take this information and use it.  It does work.  Its a basic attack and it's based on laws written to protect you from scum like debt collectors.  Remember, you don't owe these punks so fight to keep your hard earned money in your own pockets, not theirs.  Its your right to spend your money as you want, not give it over to these extortionists who will continue to harass you in an attempt to steal it from you if you don't knock them down and out of your lives.

Now, for those of you that want help with removing collections, we are extending our Christmas special into the New Year!  We use advanced techniques and put laws, case law, statutes, Supreme Court rulings and more in the debt collectors' faces. We go well beyond the attack shown above to get you the fastest results possible, all while staying ethical, honest, and within the law. Our special is valid through January 31, 2015.

Our special will save you anywhere from $100 - $300 depending upon the number of collections on your report, as well as other derogatory items.  To qualify for the special, you need to have at least FOUR 3rd party collectors furnishing information on your report.  You will need copies of your credit reports for all 3 major bureaus so get them together and contact us so we can help you have a new, pretty credit report in this exciting New Year!  My email address and phone number are up on the top right hand side of this blog.  I look forward to hearing from you and helping you fight the debt collectors and win!

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 Follow Up Letters For A Medical Collector's Validation Response

On my last post, I had already written so much that I thought it would be good to address the follow up letters you need to send when you get a supposed validation response for a medical collection in another blog post. Collectors, whether standard alleged debts or medical, have to comply with the FDCPA and also the laws that many states have that mirror the FDCPA.  But, medical collectors also have to comply with HIPAA. That is the Health Information Portability and Accountability Act.

First of all, when you demand validation from a collector for an alleged medical debt, you really should be altering your letter a bit.  Medical providers have to comply with very strict HIPAA regulations. HIPAA governs the privacy of medical information. Failure to comply with, or committing violations of HIPAA, come with stiff penalties and even jail time.  This set of laws isn't playing around.  When you demand validation for medical collections, you need to use HIPAA to your advantage.

Medical collections are most of the time actions of 3rd party collectors.  It is very uncommon to have collections from the actual medical provider.  They are in the business of medical stuff, not collections. They have billing and accounts receivable departments, but they usually turn accounts that are not paid for in 30 - 90 days over to a collection company immediately after that time has passed.  That is wonderful for you. 

I'm not saying you shouldn't be taking care of your medical bills, but really, who has that kind of money laying around?  If you don't have insurance or you do but they are slow to take care of their part, it affects your credit, and they don't give you time to make payment arrangements usually. No, they let the 3rd party collection companies do that.  Well, you know how I feel about 3rd party collectors - you don't owe them a dime!

I hate 3rd party collectors, and the 3rd party medical collectors really turn my stomach.  Here's why.  I'm in real estate. You have a property that you listed or you have a buyer that finally got his offer accepted and you're on the final stretch in escrow.  The buyer has been approved for a loan, credit is fine, no collections that have to be paid, then...out of nowhere, on the final credit pull by the lender prior to funding...OH CRAP!!!! There's a brand new medical collection that is super old, reporting on the credit report and its screwing up the score and it has to be paid and removed or this deal goes south!

YES, THAT'S WHAT THESE BLOOD SUCKERS DO!  They monitor or ping, or somehow find out someone is buying a house and they know that people will pay even old, time barred debts so that they can finally buy their house. These 3rd party collectors are unscrupulous, low life, law breaking, scum of the earth pricks that will do ANYTHING for money!  Okay, you get the idea, I really can't stand them!

Let's take a look at the types of responses you may get from medical collectors. The first one, and the main one I like, is the letter that straight out says they are discontinuing collection efforts and sending it back to the original creditor.  That is such a beautiful thing to see.  Sometimes they will even state in the letter that they are removing all entries of it from your credit reports.  You will still need to send a dispute letter to the bureaus to make sure that they take it off.  If it doesn't come off, send another dispute to the bureaus with a copy of the letter that the collector sent you stating that they are removing it. That should definitely make it go away.

The next type of response is very similar to other types of collections.  They say they have investigated and they are reporting correctly.  That is NOT validation!  That is HEARSAY! Sometimes when they address their response, they call it your request for "Verification."  You did NOT ask them for Verification, you asked them for Validation.  Validation is forwarding copies of the actual proof of the alleged debt and alleged account.  Verification is being willing to testify under oath that they have the documents on hand, know everything that has ever transpired on the alleged account, and testifying that everything that is reported is 100% accurate.  Your follow up letter tells them what I just said.  Hold them to it, call them on it (in writing, not on the phone), and never acknowledge the alleged debt or alleged account.  It is their job to prove it.

The next type of response is also very similar to other types of collections. They may respond just like the previous example, but they include a printed statement from the original creditor. Sometimes it will be a copy of your signature agreeing to be responsible.  Sometimes you can tell that they copy/pasted the signature.  That is still not validation.  That is a paper saying that you agree to be responsible for the services, but it is not a contract between you and them.  Where is that?  Where is the full accounting?  Where is the contract showing that they have been given the right to collect on the alleged debt from the original creditor?  They don't send those because they don't have it.  And if they give the full accounting, well, you've got them on HIPAA violations really strongly.

The next type of response is my second favorite response.  It is the one where they send a full accounting from the medical provider.  It has medical procedures, medications, supplies, you name it.  It has HIPAA violation written all over it! You see, that is your information that is supposed to be very private. They are never supposed to come in contact with that kind of paperwork.  This is the one where your response letter really gets to go after them and ream them good. Here's some of the stuff I tell them when I see those:

• They committed a Level 3 HIPAA violation that comes with not just financial penalties but can also get them up to 10 years of jail time.  A Level 3 HIPAA violation is "an offense committed with the intent to sell, transfer, or use individually identifiable health information for commercial advantage, gain or malicious harm.
• They are in violation of Subtitle D of ARRA Sec. 13401 (Application of Security Provisions and Penalties to Business Associates of Covered Entities) 
• They are in violation of Subtitle D of ARRA Section 13407(1) - (Breach of Security).
• The last 2 can hold them liable for penalties under the HITECH Act.
• They will be in clear violation of HIPAA (..."no permissible business purpose in divulging protected health information to anyone on an account") should they ever inquire, report, update or verify anything on the credit report

ARRA is the American Recovery and Reinvestment Act which gave stimulus monies to the health care industries for IT resources. HITECH is Health Information Technology for Economic and Clinical Health. HITECH is Title XIII of ARRA. They have a lot to do with health and medical information being maintained and communicated through technological means. Think - filing and maintaining these very sensitive files online or on computers.  

Now, another thing I look for in their responses, is if they have dates of the original bills or services.  Many times, you will find that they are outside the Statute of Limitations for your state.  You can hit them with that as well.

One thing I ALWAYS include in my responses to the 3rd party medical collector, is the fact that since they are 3rd party, they have no rights to collect anything from the alleged debtor since there is no way they can prove they were on any original contract.  I always hit them with 73 AmJur, 2nd, Section 90.  They have no right to "subrogate" (substitute) themselves into a contract, whether it is by purchase, assignment, transfer, or trade. If they "bought" the debt, they did it on their own behalf, not at the request of any alleged debtor, and therefore are a "stranger to the transaction" (voluntary payee).

One of the final things I put in the letters to these vultures that clearly violate HIPAA, is that if they refuse to delete all information they furnished to any and all credit bureaus, and they do not destroy any information about any alleged account they claim to have with me, to prevent them from pursuing any more collection activity against me, and that should they sell, assign, transfer or trade the alleged account to some other entity to attempt collection, I will file a formal complaint to the DHHS OCR against them. (Department of Health and Human Services, Office of Civil Rights).

I like to hit them hard, throw the law at them and give a call to action - to get rid of it, get it off the credit report and never pull this with me again or allow some other 3rd party scumbag to attempt to mess with me either.  You can do the same.  Use the laws you find to go after them. Put the laws in their face. Its a game.  Defense is always important, but its your offense that wins the game!  Be strong. Be knowledgeable. Don't be intimidated! 

I love credit repair. I love writing. I love helping people. I love winning!  If you don't love writing, don't like research, don't look forward to repairing your credit on your own, but you want to fight, you want a chance to win the credit repair game, please call or email me.  My contact info is up at the top on the right side. I would like to help 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.