@Anonymous wrote:
Two years ago, I purchased a number of services from a company to help setup a business for me. The next year, when I got an invoice for them to continue their "services," after paying for that year, I decided to cancel their services (including being a registered agent for my company). I thought everything was fine until I got a notice Friday from a collections agency saying I owe them $260 for this year's "services." The original company also left a voice mail regarding a "business matter" on my VM on the same day.
After doing research, it appears my situation is a common scam of this company. I can't afford for this to show up on my credit report as we are applying for a mortage in January. Should I just suck it up and pay the money, and then fight them later to get my money back? What steps can I take to show that I have no longer agreed to their services, so that can't do the same thing next year?
Bad timing.
If I had that, I would proceed on the assumption they will report.
I'd start by opting out from each credit report (search for the URL, but it's something like optoutprescreen.com...trust but verify). Some CAs (collection agencies) will subscribe to your credit reports and look for triggers by which to alert, like mortgage inquiries. The idea behind that is that they will report after seeing a mortgage inquiry and they'll report knowing that your mortgage lender will likely require you to pay for it in order to close. Opting out doesn't prevent them from reporting, it just prevents them from receiving info from the CRAs by which to make a decision to report.
I would also assume they might report regardless. If I had that I would send a DV letter to the CA. If they verified and if I agreed, then I'd pay right away. If this debt isn't valid then they might just go away and never report after seeing the DV. I would also delay in mailing out the DV. By law you have 30 days from that initial notice (aka a dunning letter). So, on about the 25th day or so I would mail out the DV CMRRR to the CA. I would also ignore their calls.
Another option as you pointed out is to pay it. Paying it isn't a guarantee they won't report. They could report as paid and that can be a pain to deal with. You can then sue them later for the amount paid.
Finally, call the OC and talk to them. Figure out why they are doing this and at least you can cancel for future years. Maybe they can pull the debt back from the CA.
Welcome to the forums!
I'd suggest reading the following:
Common Abbreviations
Credit Scoring 101 - great for knowing what is in your credit score and to see how your score is impacted.
What Steps Do I Take - great for learning the repair process.
and Example letters - PFDs, GWs, DVs, etc.
