topic Re: 10 Year Old Debt in Rebuilding Your Credit

10 Year Old Debt

armywifelong03 — Mon, 04 Jun 2012 19:44:59 GMT

Hi guys! I just have a quick question. We have been rebuilding our credit, we are doing great! But, today, I got a letter from Asset Acceptance for an old phone bill from 2001 for $99.88. This isnt on any of my reports, and shouldnt this be out of the SOL? I just wanted to see if anyone else had this happen and should i just ignore it? We are looking at buying a house next May/June timeframe and want everything to be perfect and no stupid surprises. It is my understanding that they can try to collect all they want, but they cant report it? Correct?

Re: 10 Year Old Debt

pizzadude — Mon, 04 Jun 2012 19:48:38 GMT

@armywifelong03 wrote:
Hi guys! I just have a quick question. We have been rebuilding our credit, we are doing great! But, today, I got a letter from Asset Acceptance for an old phone bill from 2001 for $99.88. This isnt on any of my reports, and shouldnt this be out of the SOL? I just wanted to see if anyone else had this happen and should i just ignore it? We are looking at buying a house next May/June timeframe and want everything to be perfect and no stupid surprises. It is my understanding that they can try to collect all they want, but they cant report it? Correct?

You are correct that the debt is past the credit reporting time period ( CRTP ). It may or may not be out of SOL ( statute of limitations ), which is the period of time in which a creditor has to bring legal action against you for unpaid debt. However the likelihood of being sued for such a small amount is small IMO.....

They can attempt to collect, but you are free to ignore their letters and/or calls. If you want them to stop calling you, just send them a cease communications letter.

Re: 10 Year Old Debt

RobertEG — Mon, 04 Jun 2012 20:23:57 GMT

They are not actually prohibited from reporting it based on expiration of the CR exclusion period, but if correctly reported, it will never see the light of day in your CR, and you most likely would never be aware of any such reporting.

A debt collector is required to accurately provide the DOFD on the OC account when reporting. If they provide a DOFD that is more than 7 years plus 180 days old, the CRA is prohibited from including it in any normal CR they issue.

Re: 10 Year Old Debt

armywifelong03 — Mon, 04 Jun 2012 20:34:24 GMT

I should specify that it was on my CR, but fell off about 3-4 years ago. Date of default was December 2002, not 2001. Either way, it has been over 9 years since default.

Re: 10 Year Old Debt

mtrsprt — Tue, 05 Jun 2012 00:36:48 GMT

Just throw the letter in the trash, and laugh at them for purchasing postage for such nonsense.....

Re: 10 Year Old Debt

tammyjk — Tue, 05 Jun 2012 23:42:22 GMT

They tried this with me about 3 mos ago. The debt wasnt even mine and it was 11 years old lol. I called and couldnt contain my laughter, havent heard from them since. Basically I told the woman this was past the SOL and good luck because its not mine anyway....just fishing. OPT OUT.

Seems all the bottom feeders come out when you apply for a mortgage.

Re: 10 Year Old Debt

pizzadude — Wed, 06 Jun 2012 01:19:14 GMT

@tammyjk wrote:
They tried this with me about 3 mos ago. The debt wasnt even mine and it was 11 years old lol. I called and couldnt contain my laughter, havent heard from them since. Basically I told the woman this was past the SOL and good luck because its not mine anyway....just fishing. OPT OUT.

Seems all the bottom feeders come out when you apply for a mortgage.

Very true unfortunately. CAs like to pounce when they get specific collection triggers from the CRAs, like mortgage inquiries.

Re: 10 Year Old Debt

Anonymous — Thu, 21 Jun 2012 15:43:30 GMT

I don't think you should communicate with the collection company. Any attempt could start the clock again. You should ignore the letter. A lot of times collection agencies sell the accounts to other collection agencies in an attempt to collect. Because the account is over 7 yrs. I would ignore the letter.

Re: 10 Year Old Debt

Anonymous — Thu, 21 Jun 2012 15:52:50 GMT

Asset acceptance is known for trying to collect on out of SOL debt (http://www.ftc.gov/opa/2012/01/asset.shtm):

One of the nation's largest consumer debt buyers has agreed to pay a $2.5 million civil penalty to settle Federal Trade Commission charges that it made a range of misrepresentations when trying to collect old debts. In addition, the company, Asset Acceptance, LLC, has agreed to tell consumers whose debt may be too old to be legally enforceable that it will not sue to collect on that debt.

They do this all the time and tried this with me. Look up the SOL for your state. If it's out of SOL, you can send an SOL letter...that got rid of them for me.

Re: 10 Year Old Debt

pizzadude — Thu, 21 Jun 2012 15:55:33 GMT

@Anonymous wrote:
I don't think you should communicate with the collection company. Any attempt could start the clock again. You should ignore the letter. A lot of times collection agencies sell the accounts to other collection agencies in an attempt to collect. Because the account is over 7 yrs. I would ignore the letter.

What are you referring to ? The credit reporting time period ( CRTP ) has expired and it can't be reset.

Re: 10 Year Old Debt

-Cain- — Thu, 21 Jun 2012 16:12:38 GMT

@pizzadude wrote:
@Anonymous wrote:
I don't think you should communicate with the collection company. Any attempt could start the clock again. You should ignore the letter. A lot of times collection agencies sell the accounts to other collection agencies in an attempt to collect. Because the account is over 7 yrs. I would ignore the letter.
What are you referring to ? The credit reporting time period ( CRTP ) has expired and it can't be reset.

The CRPT cannot be reset, but the SOL might be, maybe by acknowldeging the debt. Hopefully someone can answer definitively.

Re: 10 Year Old Debt

Anonymous — Thu, 21 Jun 2012 16:14:32 GMT

If it's outside SOL and CRTP, paying is optional.

Re: 10 Year Old Debt

Anonymous — Thu, 21 Jun 2012 16:23:48 GMT

If they do push this, ask them to provide you an itemized list of the charges. Under the Federal Fair Debt Collections Practives, they must provide this when you ask for it.

http://www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt144.shtm

Re: 10 Year Old Debt

musakluv — Thu, 21 Jun 2012 16:55:56 GMT

Credit reporting is based upon the Date of Last Activity. If you make a payment and you are giving permission to restart the clock and it WILL affect your FICO which calculates activity in the past 24 months. Toss the paper in the trash and ask them to stop calling you.

Re: 10 Year Old Debt

cashnocredit — Thu, 21 Jun 2012 17:24:43 GMT

@musakluv wrote:
Credit reporting is based upon the Date of Last Activity. If you make a payment and you are giving permission to restart the clock and it WILL affect your FICO which calculates activity in the past 24 months. Toss the paper in the trash and ask them to stop calling you.

No.The 7.5y reporting FCRA SOL is based on DOFD. Even if you make a payment the most you could do would be reset the state SOL for filing suit and that varies by state. Making a payment on a CA never extends the FCRA reporting SOL.

Re: 10 Year Old Debt

JusdoNit — Thu, 21 Jun 2012 17:42:49 GMT

The ship for them has sailed. Ignore the mailings. If they call tell them NO, THANK YOU for their offer and end the conversation.

For me; they called about 20 plus year debt. I listened to their offer and when asked" Will you be taking advantage of this offer?" I politely replied "No. Thank you." The caller from the CA started laughing so hard he could barely reply as I said good and hung up.

Re: 10 Year Old Debt

pizzadude — Thu, 21 Jun 2012 17:56:23 GMT

@musakluv wrote:
Credit reporting is based upon the Date of Last Activity. If you make a payment and you are giving permission to restart the clock and it WILL affect your FICO which calculates activity in the past 24 months. Toss the paper in the trash and ask them to stop calling you.

This is not correct. The credit reporting time period as described in the Fair Credit Reporting Act ( FCRA ) is 7.5 years from the date of first deliquency of the original account, regardless of whether a debt is paid or unpaid.

Re: 10 Year Old Debt

Anonymous — Thu, 21 Jun 2012 17:58:26 GMT

Ok, since I'm new here, I'll ask the dumb question; Why not just pay the old and relatively small debt in full? I understand that there is no legal obligation and that the money would be going to a collection agency rather than the original service provider. But a clear conscience might mean something to some people. So I guess the adjunct to my original question is, would it be more trouble than it's worth to just pay it off? Could paying the old debt in any way show up on a credit report and negatively affect someone, for example, applying for a mortgage? Could it also be an invitation to an unscrupulous collection agency to pursue additional shenanigans against an honest (but somewhat foolish) person?

Thanks for any insights.

Re: 10 Year Old Debt

Anonymous — Thu, 21 Jun 2012 18:13:53 GMT

YES, aggie is correct, If you make one single payment on an old debt the 7 years starts over. For example if you owe $1000 10 years latter you make a payment of $1 you will now have $999 back in collections and it can stay on your report for 7 more years.

This begs the retorical question, "Then why should I pay off an old debt?" because you could effectively hurt your credit score by paying off an old debt, because it will then show up as a paid off collections account.

Re: 10 Year Old Debt

pizzadude — Thu, 21 Jun 2012 18:21:34 GMT

@Anonymous wrote:
YES, aggie is correct, If you make one single payment on an old debt the 7 years starts over. For example if you owe $1000 10 years latter you make a payment of $1 you will now have $999 back in collections and it can stay on your report for 7 more years.

This begs the retorical question, "Then why should I pay off an old debt?" because you could effectively hurt your credit score by paying off an old debt, because it will then show up as a paid off collections account.

That's not how it works. The credit reporting time period for collections is 7.5 years from the date of first deliquency ( DOFD ) of the original account. This doesn't change regardless of whether you pay or do not pay. If a collection agency alters the DOFD to be newer based on a payment they are in violation of the FDCPA.