topic Re: I'm getting confused about some of SOL posts on here in General Credit Topics

I'm getting confused about some of SOL posts on here

billhill — Thu, 28 Apr 2011 12:39:14 GMT

I live in South Carolina. I keep reading posts that say how dangerous it is to send a debt validation letter within SOL, but why wouldn't you? I mean, if the reporting SOL is expired and the debt is no longer on the credit report I could understand, but why not send a debt validation letter if it is still within that 7 year period and is being reported to the credit bureau? I know that they could get a judgement against you at that point and make you pay the entire amount due, but that wouldn't start the 7 year reporting period over again, would it? Am I misreading these posts?

Re: I'm getting confused about some of SOL posts on here

203bravo — Thu, 28 Apr 2011 13:23:43 GMT

Bill -

The SOL is state specific that gives the creditors a specific amount of time to seek legal action to recover any monies. it has nothing to do with the 7 year reporting clock.

There are a couple of reasons to be careful about DV'ing a debt if the SOL is still in effect.

You are correct that some CAs see this as an attempt to not pay and may start immediate legal action -- and yes this is can result in a judgment against you. SO:

1 - does one have the cash to pay this or risk getting wages attached (if allowed by state law)?

2 - the judgment is a NEW entry onto a credit report and it is NOT bound by the 7 year reporting of the original DoFD.

3 - the judgment entry will bring one's score down even more that it already is.

Hope this helps a bit to understand why most don't recommend DV'ing an account that is within the SOL unless you have the cash on hand to PIF to avoid the legal action.

Re: I'm getting confused about some of SOL posts on here

cw81 — Thu, 28 Apr 2011 13:24:01 GMT

The SOL in question is the legal SOL the timeframe in which you can be sued on the said debt. So if the SOL on CC debts is say 4 years you can be sued within that time frame if you are not prepared or able to pay the debt it puts a big monkey wrench in your lifestyle as they will most likely garnish your wages. If it is outside that time frame if they sue you have an affirmative defense that its outside the SOL and you will win on those grounds. I hope that clears it up for you

Re: I'm getting confused about some of SOL posts on here

billhill — Thu, 28 Apr 2011 13:30:48 GMT

Thanks. You folks have cleared up quite a bit of confusion for me. I do have just one more question. When I opened all of these accounts that are now with the CA's, I lived in Georgia. The SOL there for written contracts (which are things like medical debts and credit card debts, right?) is 6 years. In South Carolina, where I now live, it is 3 years. So the South Carolina laws apply to me, even though I lived in Georgia when the accounts were opened, correct? Thanks again.

Re: I'm getting confused about some of SOL posts on here

RobertEG — Thu, 28 Apr 2011 13:58:43 GMT

Carrying the SOL explanation a bit farther, some consumers mistakenly also believe that expiration of the credit report inclusion periods set forth in FCRA 605(a), such as 7 years from a monthly OC account delinquency, and 7 years plus 180-days from the DOFD on the OC account for collections and charge-offs, are also a type or "statute of limitations" on the credtiors and/or debt collectors for contnued reporting to a CRA. They are not.

A creditor or debt collector can continue to report accurate information to a CRA, thoretically forever, even after the credit report exclusion peiiod has passed.

FCRA 605(a) are limitations solely on the CRAs, and not the creditors or debt collectors, Those limitations define what a CRA normally cannot continue to include in any credit report that they issue after those dates. Expiration of those periods simply "masks" information in your credit file from being viewed by those who pull your credit report. And those restrictions are not absolute. FCRA 605(b) provides for some exemptions from CR exclusion.

I raise this issue because, not only are the legal debt obligation SOLS unrelated to credit reporting, but the expiration of the periods under FCRA 605(a) also carry with them no statutory limitation on condinued credit reporting.

Re: I'm getting confused about some of SOL posts on here

203bravo — Thu, 28 Apr 2011 18:18:30 GMT

Bill -

Yes they will be bound by the SoL in the state in which they seek legal action -- thus for you currently it would be SC.

The SoL in SC for open contracts (credit cards) is 3 years HOWEVER NOTE: A partial payment or acknowledgment in writing tolls the SoL, (SCCLA 15-3-30) (this restarts the legal SoL NOT the reporting clock)

Written Contracts is 10 years.

GA - Open is 4 years and written 6 yrs.

Re: I'm getting confused about some of SOL posts on here

Anonymous — Sun, 01 May 2011 01:07:12 GMT

@billhill wrote:
Thanks. You folks have cleared up quite a bit of confusion for me. I do have just one more question. When I opened all of these accounts that are now with the CA's, I lived in Georgia. The SOL there for written contracts (which are things like medical debts and credit card debts, right?) is 6 years. In South Carolina, where I now live, it is 3 years. So the South Carolina laws apply to me, even though I lived in Georgia when the accounts were opened, correct? Thanks again.

Creditors generally have to sue you where they find (serve) you. For most, that would be the state in which you currently reside. Technically, though, they could sue you in one state and attempt to use the SOL of a second state, but those instances are rare.

If, after determination that the debt actually does belong to you, you are prepared to pay, a DV would not be dangerous. If your DV is timely made, even if the CA decides to sue you they must still respond to the DV before they are able to do so.

Re: I'm getting confused about some of SOL posts on here

MarineVietVet — Sun, 01 May 2011 03:52:58 GMT

@Anonymous wrote:

Creditors generally have to sue you where they find (serve) you. For most, that would be the state in which you currently reside. Technically, though, they could sue you in one state and attempt to use the SOL of a second state, but those instances are rare.

If, after determination that the debt actually does belong to you, you are prepared to pay, a DV would not be dangerous. If your DV is timely made, even if the CA decides to sue you they must still respond to the DV before they are able to do so.

This brings to mind a discussion that went on several months ago and I can't remember if there ever was a consensus.

We all know that a CA has to stop collection activity until they respond to a DV. If the SOL has not expired is filing a lawsuit after receiving the DV considered "collection activity" and therefore prohibited?

I don't know. I'm just asking.

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

Re: I'm getting confused about some of SOL posts on here

Anonymous — Sun, 01 May 2011 05:08:42 GMT

@MarineVietVet wrote:
@Anonymous wrote:

Creditors generally have to sue you where they find (serve) you. For most, that would be the state in which you currently reside. Technically, though, they could sue you in one state and attempt to use the SOL of a second state, but those instances are rare.

If, after determination that the debt actually does belong to you, you are prepared to pay, a DV would not be dangerous. If your DV is timely made, even if the CA decides to sue you they must still respond to the DV before they are able to do so.
This brings to mind a discussion that went on several months ago and I can't remember if there ever was a consensus.

We all know that a CA has to stop collection activity until they respond to a DV. If the SOL has not expired is filing a lawsuit after receiving the DV considered "collection activity" and therefore prohibited?

I don't know. I'm just asking.

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

There have been several decided cases on just that issue and the general conclusion is that, yes, filing a lawsuit is a collection activity.

The actual summons is not considered a collection activity, but the filing of a complaint which initiates the lawsuit is. Some states, such as NY, have even mandated that all paperwork related to a consumer credit lawsuit must have all the required FDCPA disclosures printed on them in plain view.

Re: I'm getting confused about some of SOL posts on here

MarineVietVet — Sun, 01 May 2011 05:20:38 GMT

@Anonymous wrote:

There have been several decided cases on just that issue and the general conclusion is that, yes, filing a lawsuit is a collection activity.

The actual summons is not considered a collection activity, but the filing of a complaint which initiates the lawsuit is. Some states, such as NY, have even mandated that all paperwork related to a consumer credit lawsuit must have all the required FDCPA disclosures printed on them in plain view.

I see. But once that DV is answered properly by the CA then they are free to sue if still within the SOL? So there is always the possiblity, no matter how slight, that a DV request could result in a lawsuit? (After proper response by the CA).

I stay confused (which is pretty common) about this.

Re: I'm getting confused about some of SOL posts on here

TheMarg — Sun, 01 May 2011 05:26:10 GMT

So if a collection account is past the 30 day initial dispute window the CA doesn't have to verify the debt, right? Are you saying, though, that even if a debt has been with the CA for a few years, well past the initial 30 day dispute window, that if it is DV'd, they still have to stop collections activity until they verify? And if they don't verify within 30 days it should be removed from credit reports?

Re: I'm getting confused about some of SOL posts on here

Anonymous — Sun, 01 May 2011 05:43:17 GMT

@MarineVietVet wrote:
@Anonymous wrote:

There have been several decided cases on just that issue and the general conclusion is that, yes, filing a lawsuit is a collection activity.

The actual summons is not considered a collection activity, but the filing of a complaint which initiates the lawsuit is. Some states, such as NY, have even mandated that all paperwork related to a consumer credit lawsuit must have all the required FDCPA disclosures printed on them in plain view.
I see. But once that DV is answered properly by the CA then they are free to sue if still within the SOL? So there is always the possiblity, no matter how slight, that a DV request could result in a lawsuit? (After proper response by the CA).

I stay confused (which is pretty common) about this.

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

Once the CA gives a proper response to a DV, they are generally free to continue collection activities. Of course, the requirements for a proper response to a DV are, at best, thin, but at least it gives one a general opportunity to see whether or not the debt is really theirs. If not theirs, they can also stop a CA in its tracks by going through the identity theft process.

On a related note, personally I have yet to see a CA sue just because of a DV request, though I do believe it is possible. The requirements for a proper DV response are so shabby that I doubt any CA -- if they really wanted -- with a legitimate debt couldn't easily meet them. Going to court, though, would require much more documentation, especially if the debtor challenges the action. More likely a CA would sue if they respond to a DV and then the debtor just flips them the bird. That is why I think it is always a good idea to be prepared to negotiate or pay if the DV response shows the debtor that the debt really is theirs.

Re: I'm getting confused about some of SOL posts on here

Anonymous — Sun, 01 May 2011 05:52:21 GMT

@TheMarg wrote:
So if a collection account is past the 30 day initial dispute window the CA doesn't have to verify the debt, right? Are you saying, though, that even if a debt has been with the CA for a few years, well past the initial 30 day dispute window, that if it is DV'd, they still have to stop collections activity until they verify? And if they don't verify within 30 days it should be removed from credit reports?

Generally, you are correct in that a CA does not have to answer an untimely made DV request. Some states, however, operate differently.

The 30-day period runs, if not mistaken, from the time of initial written communication by the CA. If they never contact you and you one day discover that they have been reporting for year on your credit reports, I would say the 30-day period runs from the time you discover their collections activities.

Under the FDCPA, CAs do not have to stop collection activities if your DV request is not timely made.

Timely made DV request = cessation of acollection activities

Untimely made DV request = no cessation of collection activities.

If the DV request is timely made does the CA have to stop / remove CRA reporting until they properly respond? I'd wait to see if RobertEG can answer that one. Without looking through my files and notes, I'd say that if they are not currently reporting, they cannot start to report. If they are already reporting, I believe they do not have to remove the tradeline, but cannot continue to update.

Re: I'm getting confused about some of SOL posts on here

Anonymous — Tue, 03 May 2011 01:39:23 GMT

If the TL is already on your report, they do not have to remove it just because they receive a DV. If they cannot validate, they have to remove.

If it has not been reported, they cannot until they answer the DV.

Re: I'm getting confused about some of SOL posts on here

Anonymous — Tue, 03 May 2011 02:23:10 GMT

@Anonymous wrote:
If the TL is already on your report, they do not have to remove it just because they receive a DV. If they cannot validate, they have to remove.

If it has not been reported, they cannot until they answer the DV.

Help me understand.

If reported, it does not have to be removed if you DV. as long as the CA responds to the DV. If they do not respond, they must remove it. Did I understand that correctly?

How much time do they have to respond before having to remove?

Re: I'm getting confused about some of SOL posts on here

Anonymous — Tue, 03 May 2011 02:42:29 GMT

They need to be able to validate the debt. Some CAs will respond to a DV wanting more information or with a dunning notice.

If they don't validate they have to remove the TL.

I don't believe there is a time limit for them to do that but I am sure they could be prompted to do so.

Re: I'm getting confused about some of SOL posts on here

Anonymous — Tue, 03 May 2011 04:43:59 GMT

@Anonymous wrote:
They need to be able to validate the debt. Some CAs will respond to a DV wanting more information or with a dunning notice.

If they don't validate they have to remove the TL.

I don't believe there is a time limit for them to do that but I am sure they could be prompted to do so.

If there's no time limit on validating, what's the time limit on removing?