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How much does SOL play into settlement?

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hisfrogness
Established Member

How much does SOL play into settlement?

The SOL for this collection isn't reached until Feb 2011. I'd really like to get this deleted but I'm afraid that contacting them will trigger a lawsuit.  How much success is there with PFD for accounts within the SOL?
Message 1 of 7
6 REPLIES 6
llecs
Moderator Emeritus

Re: How much does SOL play into settlement?

Do you have the money to PIF? If not, don't touch it until SOL expired or you have the $$$ to PIF, if you had to  (to avoid a lawsuit).
Message 2 of 7
RobertEG
Legendary Contributor

Re: How much does SOL play into settlement?

Sorry for the lengthy response, but here are the issues as I see them. 

You have a legiitmate concerns, for several reasons.  And a great question.

The first, and major thing I would look at is, how much is the debt?  The larger it is, the more liikely that they might pursue legal action.

On the legal front, there are many things to consider relating to SOL and credit reporting, separate in and of themselves, but nonetheless interrated in some aspects.

 

The first thing you must clearly pin down is the DOFD on the original creditor account. That is simply the date of the first (30-day) delinquency with the OC that is causing all your woe.

That date begins the 7 1/2 year period for continued reporting of the CA account in your CR.  SOL has absolutely nothing to do with credit reporting.

Also be aware that many CAs express to you, as corporate policy, that payment of a CA is not grounds for deletion from your CR, so they will refuse outright to delete.  And this policy is, IMHO, totally justified.  The credit reporting manual to which they subscribe includes specific instructions to CAs that they are NOT to request deletion of a CA based on it payment.  It is not illegal for them to do this, but it does violate their credit reporting guidlelines.

 

Moving on to SOL.  State SOL laws set the initial running of your SOL expiration at that same DOFD on the OC account.  But here is the rub.  Some state laws provide for a reset of the running of the SOL based on payments of any kind, and other states permit reset of the SOL based merely on offers to pay, which is what a PFD offer is.

 

A creditor, be they an OC or a CA, never has to accept a PFD offer, for it is not a PIF, it is just a conditional offer to pay in the future.  If they accept it, then it is win-win for you.  It erases the CA, and any chance of legal action by them.  But if they dont, it might reset your SOL and emboldened them based on the fact that you have shown inclination to pay.

 

I cannot offer you advice on how to proceed, any more than I can advise you whether to double down on a hard 12 at a black jack table. It is a gamble, with no clear answers.

 

 

 

Message 3 of 7
hisfrogness
Established Member

Re: How much does SOL play into settlement?

Thanks Robert for a very detailed breakdown of all the considerations Smiley Happy

 

The debt is $2,600. So it's not a tremendous amount but enough that, considering all things, I could get a summons. DOFD is Feb 2005 and I incurred the debt in AZ which has a 6 year SOL for debt (I'm in CA now).

 

If I do contact them it will be to negotiate a settlement with the ability to PIF so I guess the SOL reset isn't so much of a concern. I can definitely see why a CAs reporting, especially within the SOL, is not something that should be subject to negotiations. I mean, credit history is suppoed to be accurate. If it's all up for sale then its sort of undermining the purpose of credit history.

 

But then again, I want a high credit score Smiley Happy 

 

Does that mean that GW letters to CAs are also technically against guidelines?

Message 4 of 7
llecs
Moderator Emeritus

Re: How much does SOL play into settlement?

Again, don't do anything until you have all $2600 in hand. If they serve you and sue and you don't have the money to PIF assuming they don't accept a settlement, then you'll have a judgment on your record too. 


hisfrogness wrote:

 

Does that mean that GW letters to CAs are also technically against guidelines?


No, they are not against the guidelines. In a GW, you are asking for a favor from the creditor to look into and adjust or remove any derog info on your CRs. The creditor is making the change in their computer. Your CR must accurately reflect what's in that computer. If the creditor doesn't want to do that, they don't have to.

Message Edited by llecs on 08-16-2009 10:02 AM
Message 5 of 7
hisfrogness
Established Member

Re: How much does SOL play into settlement?

Thanks IIecs Smiley Happy I definitely won't contact anyone until I have the cash to PIF.

 

My GW question was directly in relation to Robert's statement:

 


  The credit reporting manual to which they subscribe includes specific instructions to CAs that they are NOT to request deletion of a CA based on it payment.  It is not illegal for them to do this, but it does violate their credit reporting guidlelines.


 

It just seems to me that GWs would fall into the same category. You're asking them to delete accurate info about your history.

 

I had another question that hopefully someone can answer. This collection is listed as an open account that is 120+ days late (Midland). They opened this account in 10/2007. The payment history shows:

 

30 days late 0 times

60 days late 0 times

90+ days late 0 times

 

If it's legitimate that that they can list a collection as an open account (and I assume it is) then why aren't they spamming my history with a late payment every month? They're listing a 120+ day payment that I never agreed to so why don't they also add a 30, 60, 90 late payment? 

 

And what sort of other updating to this account can they do to further hurt my score?

 

Any insight would be greatly appreciated!!

Message 6 of 7
gdtobefree
Established Contributor

Re: How much does SOL play into settlement?

The open statement can be debatable, it could be construed as an open ended account when the OC had it.

 

Do keep in mind if you do NOTHING at this point and just let it sit you MAY end up with a judgement filed against you and Midland is the slickest of all when it comes to this, they will contest that they served you properly when in fact they didn't and will be awarded a default judgement. If that happens you will be rewarded with a judgement on your credit reports for 10 years for the amount of the debt PLUS filing fees and court cost, which BTW is renewable EVERY 10 years during the course of your life or until it is paid.

 

The amount of the debt is large enough for them to NOT let it sit, I for one would send them a DV letter asking for FULL validation of this debt, as well as their proof that they are legally allowed to collect a debt in your state. Upon reciept of that information and you find that the debt is still valid and no other charges have been added to the balance by Midland then I would offer a PFD,Now, granted they do not have to agree to a PFD that is going to be your 1st negotiation tactic, if they refuse a PFD then I would get the ball rolling in a settlement. I would offer 10% of the amount owed, if they come back with are decline to that then up your offer to 15% of the balance and again if the delcine that offer give them a last offer of no more then 25% and make them aware that it is your LAST offer.

 

Keep everything you do in writting, your contact and their responses, keep them in a file I can gaurantee you that they WILL violate any law they can to get you to pay this debt, your paper trail will be your vistory when they do violate any laws.

 

Doing nothing with a debt this large is asking for unintended consequences.

 

 

Message 7 of 7
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