Charged off account removed by orginal creditor...

[Anonymous]

If there is no record of the orginal negative account that the collection agency says that they purchased my debt from on any of my 3 credit reports does that mean any collection has to to be removed?

I currently have a collection from Portfolio Recovery that I've disputed recently and in the documentation that they sent in return it states that the account was purchased from Capital One who had acquired it from HSBC bank, however neither of those 2 accounts are currently listed anywhere on either of my 3 bureau reports (well I currently have 2 CC accounts with Capital One that are in good standing, but the account that they are alleging I owe from is not on my reports at all). Can I use the fact that there is no history of the orginal accounts being shown on my reports to dispute the collection and have it removed as well?

[Anonymous]

How old is the account was account that was purchased 7 years or more from the date of first delinquency? Are you disputing on the grounds that this third account never existed? It's not uncommon for the original creditor to remove their charge off when debt is sold and the collection agency picks up where the original creditor left off reporting the debt. This has been my experience but myFICOer RobertEG is much more knowledgeable than I on collections and the laws that accompany them and I'm sure will chime in at some point.

[Anonymous]

Hello,
Thanks for the response!

The account is currently 3 years old, and I'm disputing if this is actually my account. I was wondering if the fact that the orginal bank no longer shows it on my report be used as proof that whatever they are trying to collect on could be an error that the orginal creditor later corrected.

[Anonymous]

A simple Debt Verification letter could give you more insight into this. It will require the debt collector to investigate with the original creditor and mail you back the results of their investigation and what they are using a proof the debt is yours. If they find that verification cannot be obtained with the original creditor they will state that and cease any collection efforts at which time with their letter you have a valid dispute to have the collection removed. Trying to dipute the collection on the grounds that the original creditor is longer reporting wouldnt be a valid dispute as a simple investigation will show that you indeed had an account with the original creditor that was defaulted on and thus showing the reporting of the collection is valid.

[Anonymous]

I see.
So far in the dispute they've sent a statement from Capitol One and a summary of the debt. Question would they have to have something from HSBC verifying the debt as well since they are listed as the actual originator of the account not Capital One.

[Anonymous]

I dont believe so but because when Capital One purchased HSBC accounts they purchased any and all debt associated with the account meaning they own the debt and sold it to the collection agency but I'm not 100% how purchasing of accounts are handled when it comes to debts and collections. Technically speaking the purchase of the accounts make them the creditor/new original creditor.

[Anonymous]

Gotcha! It's kind of frustrating because a lot of people preach that if the collector has no proof of the debt from the orginal creditor then it is not sufficient validation, so I'm not sure which way to go at this point.

My last question would be would they need the documentation of the orginal contract with HSBC if they choose to file a suit to collect? I ask because Arkansas law says debts without written contracts pass the SOL in 3 years which would have already passed for this (unless the clock on that doesn't start until the time the collector purchases the debt), while the SOL for debts with contracts is 5 years. Would the SOL be up already for this if they don't have the orginal contract (which I doubt they have)?

I was thinking I'd try to negotiate a PFD with them for half the amount by letting them know that if left with no recourse to get this deleted then I fully intend to just wait it out but I don't want them to end up turning around and taking me to court if it's still within the SOL.

Anyways sorry for so many questions and thanks for your help!

[Anonymous]

The clock starts from DOFD (Date of First Delinquency). However this is where I cannot give any further information simply because this case isnt cut and dry. Capital One purchasing the account makes it unique as I dont understand how they handle previous contracts and or debts. Hopefully someone with more knowledge can assist further. Regardless of who had the contract and who currently holds it if there is one doesnt affect the DOFD so that remains the same so your go to date would be that for SOL.

[RobertEG]

No, deletion of an account or of derogs by an original creditor is not evidence that the debt is invalid, and is not basis for requiring deletion of a collection reported by a debt collector.

Credit reporting is voluntary, and a creditor can choose to voluntarily delete their reporting.

Debt collector reporting of a collection is by a separate party, and records authority to pursue collection on a delinquent debt.

Each makes their own reporting decisions.