Helping a friend with collections and judgments, Unique situation

[Anonymous]

Hi all,

A good friend of mine has asked me to help him clean up his report. He's in a unique situation in that he doesn't have any credit at all. Nothing showing on his reports other than some collections and judgments. I want to help him but I really don't know where to start. I'll summarize...

1) For the past 6+ years he has only lived on cash, land contract for his house, no cc's or loans.

2) Had a hospital visit last year that resulted in a $6,000 balance that has now gone to collections. The $6,000 is divided up by 3 companies, one for hospital, one for labs, and one for cardiologist.

3) Has a Sears card he stopped paying on in 2003 that went to collections (Asset Acceptance). They filed suit and got a default judgment on him in Feb 2008.

4) Has an AT&T balance that went to collections (Asset Acceptance) in 2006.

5) Has a Providian CC that he stopped paying in 2002 that went to collections (Great Seneca). They filed suit and got a default judgment on him in 2004. Palisades now owns this debt.

He has cash and wants to look at getting this stuff paid off and removed if possible. He also wants to start building credit and get a mortgage in the future. He's aware that there is no way that he's going to get any credit card without it being a secured card initially.

So, any help on how to get started on this would be greatly appreciated.

Fred

Message Edited by fused on 04-14-2009 08:50 AM

[Anonymous]

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LostInMich wrote:
Hi all,

A good friend of mine has asked me to help him clean up his report. He's in a unique situation in that he doesn't have any credit at all. Nothing showing on his reports other than some collections and judgments. I want to help him but I really don't know where to start. I'll summarize...

1) For the past 6+ years he has only lived on cash, land contract for his house, no cc's or loans.

2) Had a hospital visit last year that resulted in a $6,000 balance that has now gone to collections. The $6,000 is divided up by 3 companies, one for hospital, one for labs, and one for cardiologist.

Visit the "Recovering from Medical Debt Board"-- see link below.

3) Has a Sears card he stopped paying on in 2003 that went to collections (Asset Acceptance). They filed suit and got a default judgment on him in Feb 2008.

Who is reporting the account? Sears or a CA? If DOFD is in 2003, it should be removed about next year.  Was he properly served for the judgment?

4) Has an AT&T balance that went to collections (Asset Acceptance) in 2006.

Can he PIF? Is only the CA reporting? Has he heard from the CA?

5) Has a Providian CC that he stopped paying in 2002 that went to collections (Great Seneca). They filed suit and got a default judgment on him in 2004. Palisades now owns this debt.

Is the OC and CA both reporting? If DOFD was in 2002, it should be removed this year sometime. Was he properly served for the judgment?

He has cash and wants to look at getting this stuff paid off and removed if possible. He also wants to start building credit and get a mortgage in the future. He's aware that there is no way that he's going to get any credit card without it being a secured card initially.

So, any help on how to get started on this would be greatly appreciated.

Fred

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Judgments will remain for 7 years from filed date, unless he gets them vacated.

Message Edited by fused on 04-14-2009 09:37 AM

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:

2) Had a hospital visit last year that resulted in a $6,000 balance that has now gone to collections. The $6,000 is divided up by 3 companies, one for hospital, one for labs, and one for cardiologist.

Visit the "Recovering from Medical Debt Board"-- see link below.

Thank you, I checked that out and although I said he has some cash to work with, he doesn't have enough to pay off this debt and all the others. Since it just went to collections in Jan, should he contact the OC to see if he can start making payments to them and have them recall the debt from the CA's?

3) Has a Sears card he stopped paying on in 2003 that went to collections (Asset Acceptance). They filed suit and got a default judgment on him in Feb 2008.

Who is reporting the account? Sears or a CA? If DOFD is in 2003, it should be removed about next year.  Was he properly served for the judgment?

Sears is no longer listed on his report.  However, there are 2 separate CA's that are showing for this account, the current CA Asset Acceptance and and earlier one LVNV Funding.  He should be able to dispute the LVNV one off his report right?  His DOFD is 04/2003 but does this matter since they got a judgment against him in 2008?  Michigan only has a 6 yr SOL but I think he is outta luck on that because of the judgment.  BTW, I checked the public record for this and it shows they tried to serve him many times and finally got approval for alternative service.  The record shows he was served  in 11/2007.  I'm thinking this is proper service.

4) Has an AT&T balance that went to collections (Asset Acceptance) in 2006.

Can he PIF? Is only the CA reporting? Has he heard from the CA?

Yes to all.  The CA is Asset Acceptance and they don't typically do PFD right?  Besides, they also hold the much larger judgment debt of $2,400.

5) Has a Providian CC that he stopped paying in 2002 that went to collections (Great Seneca). They filed suit and got a default judgment on him in 2004. Palisades now owns this debt.

Is the OC and CA both reporting? If DOFD was in 2002, it should be removed this year sometime. Was he properly served for the judgment?

OC is no longer on his report.  CA is reporting as a collection for the judgment.  Although the DOFD was 2002, they can still collect because of the judgment in 2004 right?  BTW, yes, it shows an alternative service by mail.

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Message Edited by fused on 04-14-2009 09:37 AM

[Anonymous]

For the CAs that also hold judgments:  these are two separate things.  The CA can still only report for the reporting period, from DOFD.  The judgments then report for their separate reporting period, usually from the date of filing.

For judgments, they can collect as long as the judgment allows them to . . . and some states allow unpaid judgments to be renewed after a certain number of years.

Message Edited by fused on 04-14-2009 09:38 AM

[Anonymous]

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@Anonymous wrote:

For the CAs that also hold judgments:  these are two separate things.  The CA can still only report for the reporting period, from DOFD.  The judgments then report for their separate reporting period, usually from the date of filing.

For judgments, they can collect as long as the judgment allows them to . . . and some states allow unpaid judgments to be renewed after a certain number of years.

Message Edited by fused on 04-14-2009 09:38 AM

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Ok, so should he even do anything right now then?  They haven't been contacting him lately.  Maybe do a PFD on the judgment after the 7 years on the DOFD?  I know the judgment won't come off but there are two listings for Asset Acceptance, one for the original debt and one for the judgment.

[Anonymous]

Ignore the judgments for a second.

For the CAs, the question is whether they are inside of the window of when they can report.  This runs from DOFD.  Usually, the period is the FCRA period:  7-7.5 years.  Sometimes states have set a smaller period, but that is usually only for paid collections.  So that may be something to work on if they are outside the reporting period.

However, if the CA also has a judgment against your friend, then tinkering with the CA's reporting may remind them that they meant to collect from your friend.

I think you should figure out what to do about the judgments first--that is, how to satisfy them, or if he wants to pay them at all.  Once you have that all worked out, should be easy to get the CA's that are "obsolete" off of the credit reports.

Can't do PFD's on judgments--only CAs.  To get rid of the judgment before the reporting period is up, the usual process is a motion to vacate.  It is rare that those are granted--usuallly only where there was a problem with the service.

[Anonymous]

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@Anonymous wrote:

Ignore the judgments for a second.

For the CAs, the question is whether they are inside of the window of when they can report.  This runs from DOFD.  Usually, the period is the FCRA period:  7-7.5 years.  Sometimes states have set a smaller period, but that is usually only for paid collections.  So that may be something to work on if they are outside the reporting period.

However, if the CA also has a judgment against your friend, then tinkering with the CA's reporting may remind them that they meant to collect from your friend.

I think you should figure out what to do about the judgments first--that is, how to satisfy them, or if he wants to pay them at all.  Once you have that all worked out, should be easy to get the CA's that are "obsolete" off of the credit reports.

Can't do PFD's on judgments--only CAs.  To get rid of the judgment before the reporting period is up, the usual process is a motion to vacate.  It is rare that those are granted--usuallly only where there was a problem with the service.

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Yep, that's kinda what I was thinking.  I know you can't do a PFD on judgments, I was thinking more in line of offering to pay 50% to have it considered paid in full.   For now, I'm going to tell him to leave the old accounts alone.  He has less than a year before the two of them are past reporting date.  That is just going to leave the two judgments that he can work on paying off.

Now, as for the medical collections, they are only a year old. Should he contact the OC's to see if he can start paying them directly and have those 3 CA's removed?  He's not in position to pay them off so a PFD using the HIPPA process isn't an option.

[Anonymous]

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LostInMich wrote:

Now, as for the medical collections, they are only a year old. Should he contact the OC's to see if he can start paying them directly and have those 3 CA's removed?  He's not in position to pay them off so a PFD using the HIPPA process isn't an option.

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 Ask that on the medical board....that is where you will get the best answer.