That's very true, Brammy. Unfortunately, up until now, the system has been set up so paying it wouldn't have helped me at all (it would have prevented further collections, but no collection agency could remove the report from the original creditor). I had tried to work with the original creditor and their internal collections department, but my financial situation at the time (and my knowledge of credit reporting in general) was very limited, and they might as well have been asking for $10 million. Over the ensuing years, this particular debt passed into and out of the hands of at least three collection agencies who didn't make any attempt to collect beyond the initial dunning letter, so I assumed it either wasn't worth their time or the "predator had no teeth" (ie - there wasn't much they could legally do, or there was some statute of limitations I was unaware of). This collection agency, which probably purchased this debt for $20 (I'm exaggerating a bit, but who knows), has now decided to get all aggressive because they *know* I'm backed against a wall and will likely cough up something just to make it go away. I don't think that's an ethical business practice at all.
I do acknowledge that I owed the debt, and I do acknowledge that the original creditor, and their designated representatives, had the authority and right to collect on the debt. They decided it was better to charge it off and eat the loss than to take any money from me. What peeves me is that now this debt shows *twice* on my credit report (double jeopardy, IMO), and this collection agency bottom-feeder has reported it as being 120+ past due 4 or more times, even though I have never entered any kind of payment agreement with them (and thus, I couldn't possibly have been late), and the late payments they're talking about have *already* been reported by the original creditor. I also fail to see how this agency has the authority and right to collect on an account which I never opened with them, and one in which they are not designated representatives of the original creditor (I know that it is *legal*, but I don't think it's *ethical*, and I think it runs counter to the "heart" of the law, as it were).
Beyond any of that, I don't see how, logically (which, I know the law and logic don't necessarily go hand-in-hand) Providian Financial (now WAMU) can assign a collection agency's, collection agency's, collection agency's, collection agency to act on their behalf when they never had contact with them, and the debt itself was merely sold on the open market. If this collector is going to continue to try to collect the debt owed to a different company, I say there should be some sort of business arrangement where that agency is acting on the original creditor's behalf, and they should actually be able to *do* something about the original creditor's reporting of the debt (so that I don't have the same debt reported multiple times). The way the system is set up now, well, heck, Billy-Joe-Bob-Gene's Big 'ol Doggone Collection Agency, LLC can report the bad debt, sell it to whoever wants it, they report it, rinse, repeat, ad nauseum, until the same debt is reported five different times on the same credit report. It artificially lowers the consumer's credit score because it looks like this person has 5 bad accounts when they really only have 1. That just doesn't sit right with me at all...
Sorry about the rambling, I just got into a "thing"...
Phllip, please don't take that comment as directed towards your situation. It just seems the thread had taken on a life bashing CRAs for updating at the creditors request. Unfortunately once the account is sold from the original creditor to a CA. that CA fan continue to sell the debt as you said 'on the open market' for pennies on the dollar. The good news about that is that the more the debt is sold, the more likely you are to be able to negotiate a settlement far less than the amount owed.
No paying it off will not remove it from your reports but it will prevent further reporting and further sales on the open market resulting in additional damage to your scores...
I didn't, Brammy. I'm sorry if it sounded like I did, but I'm just so peeved at this that I kind of lash out at the wrong moment.
I just hate that I'm powerless to do anything but cough up whatever the heck they want me to pay (and they *know* I'm going to have to - so my negotiation room is probably pretty small), and I wasn't even given an opportunity to try to work something out with them *before* they dropped the big hammer. I can honestly say that if I knew that this creditor wanted to collect (and that the debt had been sold again) before I signed all the mortgage paperwork and committed to the loan, and they had given me some time, I would have probably worked with them without resentment. After all, I am trying to get my scores as high as possible, so preventing further collections would be in my best interest for the future, right?
Anyway, I think I'm going to end up having to just squeeze that turnip some more to see what comes out, but I doubt I'd be able to cough up any more than $100 at the most... and that just might be stretching it. Does anybody think that this collection agency (keep in mind that this will be at least the 4th collection agency who's had this) will settle a debt that was originally $2,414 (after all the exorbitant fees were added, but that's another thread altogether) for $100 or less? Or am I just screwed?
Just thought I'd pop back in and update everybody on this. Yesterday afternoon at 4:15 EST, I closed on my house, and I have the keys in my hot, little hands! I don't think the reality has *really* set in yet, but as of yesterday, I am officially a home owner and well on my way to my little slice of the American Dream. The lender didn't even care about the collections accounts because my overall score didn't change drastically (it did drop by slightly more than 10 points on all three reports, but still above the minimum required by the bank with a bit of breathing room), the collections were for black marks already reported elsewhere on my report that I had already been approved with, and my income and debt had stayed the same.
Now, who wants to help me paint the new house and move all my crap into it?