If your debt was sold (assigned) to a debt collector, this simply means that your original creditor gave their right to recover the money to the debt collector. In that case, you no longer owe the original creditor any money and you need to engage directly with the debt collector instead.
The creditor will sell your debt to a collection agency for less than face value, and the collection agency will then try to collect the full debt from you. If you owe a debt, act quickly — preferably before it's sent to a collection agency.
Can you dispute a debt if it was sold to a collection agency? Your rights are the same as if you were dealing with the original creditor. If you don't believe you should pay the debt, for example, if a debt is statute barred or prescribed, then you can dispute the debt.
If a Debt Collector obtains a Court judgment against you or your company, they can apply to the Court to issue a writ against you. This will result in the Court sheriff attending your house or business premises and seizing and selling your assets to satisfy the creditor's judgment debt.
It's possible in some cases to negotiate with a lender to repay a debt after it's already been sent to collections. Working with the original creditor, rather than dealing with debt collectors, can be beneficial.
If you are struggling with debt and debt collectors, Farmer & Morris Law, PLLC can help. As soon as you use the 11-word phrase “please cease and desist all calls and contact with me immediately” to stop the harassment, call us for a free consultation about what you can do to resolve your debt problems for good.
It's important to try and pay the original creditor before a debt gets sent to collections. In some cases, the original creditor may be able to reclaim the debt from collections and work out a payment plan with you. A collection account on your credit report harms your credit score considerably.
Six Year Limitation Period
For most debts, a creditor must begin court action to recover the debt within six years of the date you: Last made a payment. Admitted in writing that you owe the money.
You might not have to pay an old unsecured debt if it has been more than 6 years (or 3 years in the Northern Territory) since you last made a payment or acknowledged the debt in writing. This is called a statute barred debt.
Organise a settlement offer with you that may make it easier to pay off the debt. Sell your debt to another company who will have the same arrangements and powers as the original creditor. Obtain an order from a court to repossess some of your property. Take court action against you.
However, they may file a lawsuit against you to collect the debt, and if the court orders you to appear or to provide certain information but you don't comply, a judge may issue a warrant for your arrest. In some cases, a judge may also issue a warrant if you don't comply with a court-ordered installment plan.
You can ask the creditor — either the original creditor or a debt collector — for what's called a “goodwill deletion.” Write the collector a letter explaining your circumstances and why you would like the debt removed, such as if you're about to apply for a mortgage.
Agreeing to pay: If you acknowledge that the debt is yours and agree to pay, the statute of limitations on your debt will start over. Making a charge: If you have old credit card or revolving debt and you make a charge to your account, the clock on your old debt will restart.
Most commission rates for debt collection services vary between 5% and 30% of the value of the debt.
No, you really can't get rid of credit card debt without paying. Filing bankruptcy for credit card debt will indeed lets you escape credit card debt. But if you're asking, “How can I get rid of credit card debt without paying anything to anybody?” the answer is still: You can't!
Typical debt settlement offers range from 10% to 50% of the amount you owe. Creditors are under no obligation to accept an offer and reduce your debt, even if you are working with a reputable debt settlement company.
There's no time limit for the creditor to enforce the order. If the court order was made more than 6 years ago, the creditor has to get court permission before they can use bailiffs.
Even if you are not legally obliged to pay any money once a debt becomes statute barred, you can still get chased for it.
They have 12 years to recover the principal amount borrowed, but only 6 years to claim interest – from when court action started.
By law, a debt collector is not allowed to threaten or use physical force of any kind towards you, any member of your family or a third party connected to you to try and collect your debt. They can, however, contact a family member, friend of third party to obtain location information on you.
Your credit score could take a hit if you repeatedly ignore calls from debt collection agencies. This might make it difficult to take out a loan in the future—or even get a part-time job, since many employers run credit checks prior to hiring.
If you have a collection account that's less than seven years old, you should still pay it off if it's within the statute of limitations. First, a creditor can bring legal action against you, including garnishing your salary or your bank account, at least until the statute of limitations expires.
The most secure way to pay a debt collection agency is by mailing a check with a return receipt. This will prove that the collection agency accepted the check.