topic Just something I found while doing some research in General Credit Topics

Just something I found while doing some research

Anonymous — Wed, 23 Jan 2008 04:45:09 GMT

I came across this interesting article...Thought it'd be informative!

I negotiated a settlement with a creditor for less than I owed. The creditor is now suing me for the balance. Is this legal?

Yes! You need to read the following information carefully.

Some collection agencies will agree to settle with you for far less than you owe and then turn around and hire another collection agency to collect the difference. However, in many states this is illegal. Once a creditor deposits or cashes a full payment check, even if she strikes out the words payment in full or writes "I don't agree" on the check, she can't come after you for the balance. The states in which this law is enforced:

Arkansas
Colorado
Connecticut
Georgia
Kansas
Louisiana
Maine
Michigan
Nebraska
New Jersey
North Carolina
Oregon
Pennsylvania
Texas
Utah
Vermont
Virginia
Washington
Wyoming

Some states have modified this rule. In the following states, if a creditor cashes a full payment check and explicitly retains his right to sue you by writing "under protest or without prejudice" with his endorsement, then he can come after you for the balance. But those exact words must be used. If he writes "without recourse," communicates with you separately, notifies you verbally or writes on the check that it is partial payment, it is not enough.

Alabama
Delaware
Massachusetts
Minnesota
Missouri
New Hampshire
New York
Ohio
Rhode Island
South Carolina
South Dakota
West Virginia
Wisconsin

Re: Just something I found while doing some research

TryingVeryHard — Wed, 23 Jan 2008 04:51:13 GMT

Very informative. It could have been more useful with the source to back it up. Now, you gave me something to research. Thanks again.

Re: Just something I found while doing some research

future — Wed, 23 Jan 2008 04:51:56 GMT

good info, to share and KNOW... ty

Re: Just something I found while doing some research

Junejer — Wed, 23 Jan 2008 05:05:46 GMT

@Anonymous wrote:
I came across this interesting article...Thought it'd be informative!
I negotiated a settlement with a creditor for less than I owed. The creditor is now suing me for the balance. Is this legal?

Yes! You need to read the following information carefully.
Some collection agencies will agree to settle with you for far less than you owe and then turn around and hire another collection agency to collect the difference. However, in many states this is illegal. Once a creditor deposits or cashes a full payment check, even if she strikes out the words payment in full or writes "I don't agree" on the check, she can't come after you for the balance. The states in which this law is enforced:
Arkansas
Colorado
Connecticut
Georgia
Kansas
Louisiana
Maine
Michigan
Nebraska
New Jersey
North Carolina
Oregon
Pennsylvania
Texas
Utah
Vermont
Virginia
Washington
Wyoming
Some states have modified this rule. In the following states, if a creditor cashes a full payment check and explicitly retains his right to sue you by writing "under protest or without prejudice" with his endorsement, then he can come after you for the balance. But those exact words must be used. If he writes "without recourse," communicates with you separately, notifies you verbally or writes on the check that it is partial payment, it is not enough.
Alabama
Delaware
Massachusetts
Minnesota
Missouri
New Hampshire
New York
Ohio
Rhode Island
South Carolina
South Dakota
West Virginia
Wisconsin

Sounds like a good reason to get everything that you want to happen in writing.

Re: Just something I found while doing some research

Anonymous — Wed, 23 Jan 2008 05:09:24 GMT

Gotta be careful when posting links cause if there's advertising links within the other website promoting credit repair sites Barry might delete. I did that once and had to go bury my head in the sand.

Re: Just something I found while doing some research

TryingVeryHard — Wed, 23 Jan 2008 06:27:38 GMT

I understand. I was actually hoping for state law citations.

I am not sure, but I believe this post may constitute plagiarism, because of the verbatim cut and paste. I can be wrong.

Re: Just something I found while doing some research

Anonymous — Wed, 23 Jan 2008 12:34:30 GMT

Simple copy/paste. Can't live without it!

Plagiarism is the practice of claiming or implying original authorship of (or incorporating material from) someone else's written or creative work, in whole or in part, into one's own without adequate acknowledgement. Copyright infringement is a violation of the rights of the copyright holder, when material is used without the copyright holder's consent.

Re: Just something I found while doing some research

Anonymous — Wed, 23 Jan 2008 12:59:45 GMT

Restrictive endorsements are an interesting topic-

Did you have one on the payment sent to this CA?

Re: Just something I found while doing some research

Anonymous — Wed, 23 Jan 2008 16:06:19 GMT

Well I do apologize if I wasnt supposed to do that....I guess next time I should double check!!...My apologies!!

Timothy: I am dealing with a CA right now and sent them a letter telling them I will be sending a restrictive endorsement on the amount we settled...Awaiting their reply

Re: Just something I found while doing some research

Anonymous — Wed, 23 Jan 2008 18:44:20 GMT

I have been afraid of this working on PFDs in the past.

I have modified my letter to include a statement saying that not only will this account be considered paid-in-full, but that the remainder of the balance is not to be sold to any third party debt collector.

Hope that covers me...