Collection Agents... - Posted by Anthony - OH

Posted by chris on June 02, 2000 at 07:00:38:

Anthony- I don’t have a cut and dry answer for you on this. One thing you can do to help you find out where you stand is to head over to the link below. They have a lot of good info at that site about the games collection agencies play and useful legal knowledge such as the statute of limitations for your state.

http://www.creditinfocenter.com/rebuild/

-Good Luck,Chris

Collection Agents… - Posted by Anthony - OH

Posted by Anthony - OH on June 02, 2000 at 05:14:24:

About 5 years ago my wife let a bank repo a car she owned. She only had the car about 9 months when the bank repo’d it. She offered to bring the loan current, but the bank refused because she had been late with most of her payments. They of course sold it at auction and it went for about half of what it was worth. They expect her to come up with the other half (standard I know). They got a judgement against her for the amount owed. Ouch. Approx. $5500

In comes collection agency they say that they will settle for 70% of the $5500…$3850. They said that 2 payments was acceptable. I made the first payment of $1925. I was not able to make the second payment and 30 days later they were calling and making threats that the deal was off unless I made the next payment immediately. I told them that they never sent anything in writing to me and that they wouldn’t get another dime until they did so. I still have not received anything.

Accounting person from collection agency calls to set up a payment plan. I tell him that if I can just pay the $1925 that I will write him a check today. He says that he will call the bank and get this approved. He calls back FOUR days later with bad news. The bank says that the collection agency never added interest for the past 5 years!!! The $1925 payment I made covered the interest and that he could probably swing a settlement for $3500!

First its ridiculous that my wife didn’t sell the car before they repo’d it. Second its ridiculous banks can sell your car for half what its worth. Third, don’t banks usually waive the interest when loans are defaulted on? Fourth, how bad does the judgement hurt me? The accounting person at the collection agency acted like the bank could take my first born to satisfy the debt. Can I sue them for breach of contract? They told me they would settle for a certain amount, and now they’re not.

Any suggestions please.

Re: Collection Agents… - Posted by ScottE

Posted by ScottE on June 02, 2000 at 09:06:57:

Anthony,

I am sure you have figured out by now that these collection guys don’t play fair. Their are only two ways to combat this problem.

  1. Pay what they say you owe (with paperwork to substantiate the amounts)
  2. Know the laws regarding judgments,collection agents and the Fair Debt Collection Practices Act better than they do. There are definite things these guys can and cannot say, specific times they can call or contact you, where they cannot contact you (i.e. at work)if you so request in writing, etc. Chris brings up an excellent point-find out what the statute of limitations is on judgments.

Since the collection agency is technically entitled to all of the amounts and remedies granted in the judgment, your wife is on the hook for it all.
The reality is that this collection company bought your wife’s judgment for pennies on the dollar. They didn’t need to call the bank back at all. That was just a ploy to get you to pay more (the whole amount!). $3500 + $1925 = $5425…almost the whole judgment!

Get a copy of the original judgment and read it. Chances are, it provides for interest from the date of judgment until paid.
Was this a car your wife bought BEFORE you two got married? If so, they have NO claim against you, however, depending on the statutes where you live, they could attach their judgment to any property your wife has an interest in and wait until a transfer occurs to collect (as long as their judgment doesn’t go ‘stale’ during this period).

I would handle them this way- tell them that you are prepared to tender a cashiers check for $1925 immediately to fully satisfy the debt (GET IT IN WRITING!!) If they decline, just say, “then all I can afford is $25 a month” They will go crazy. If they threaten you (know the law), then ask for a supervisor and let him know was his pawn told you and that you intend to sick the feds on them.
The bottom line is to get this monkey off of your back. Get it settled and move on.

Good luck!
Scott

Read up on the Fair Debt Collection Practices Act… - Posted by Ben (NJ)

Posted by Ben (NJ) on June 02, 2000 at 08:56:50:

this is a federal statute which makes collection agents quake in their boots, it mandates all kinds of
picky requirements and disclaimers which they must meet otherwise THEY can be sued for abusive, deceptive and unfair debt collection practices. Bronchick recently wrote an article about this, maybe you can find it on his site, Legalwiz.com

You SHUDDA waited till you had something IN WRITING b/4 you made your first payment to anyone (settlement or otherwise)… - Posted by SusanL.–FL

Posted by SusanL.–FL on June 02, 2000 at 08:08:26:

I do know THIS—if you owe on a car loan (repo), they will hunt you down like a DOG till they get their LAST dime! This is fact, according to Dave Ramsey (author of Financial Peace). Recently he gave some STARTLING information regarding banks who make car loans.

Let’s say you have several other accounts with that bank (ckg,/savings/mortgages, etc.) and suddenly you ‘default’ on your car loan. They can (by law) and WILL dip into your checking account or clean out your savings account.

If you have just paid off a mortgage (with them) and are waiting for your ‘Satisfaction’ paperwork to be processed, they can refuse to give it to you UNTIL you have paid your car debt to them IN FULL! Scary, isn’t it? I didn’t know this.

I was driving along on my lunch hour a couple weeks ago when I heard this on his radio program. Shocked the ‘you know what’ outta me!

He said car loans are treated very different than other loans and they will HOUND you to death till you pay up.


I was nearly in your shoes last year. Things had gone haywire and I was having a devil of a time trying to make our two car payments (an original total of $62K!!). Talk about SCARY–but I got thru it.


Like you said, it is TOO bad that your wife just didn’t sell the car herself and make up the $difference$ out of her pocket. You would be over and done with it by now.


If nothing else comes from this experience, at least we can all learn from each other’s mistakes.


My advice is: Sit down with someone with some authority who will tell you ‘what the score is’ on what you owe. Put everything in writing then pay it off!

Good luck.