@Anonymous wrote:
Hello,
Thanks in advance for any replies.
Not sure if it matters but I live in the state of NJ. Back in 2017 I took out a $10,000 personal loan from Freedom Plus for a relative, whom subsequently defaulted on the loan. I am no longer in contact with relative. Out of the $10,000 about $3,000 was paid and the loan was charged-off in 2018.
Freedom Plus the sold the loan to a collections company, Second Round LP in Austin, Texas. I have not been contacted by Second Round as of yet and would like to be on the offensive. Financially I am in a bit of a squeeze, but I can afford to make $300 monthly payments, if it came to that.
What should my next steps be? If I wait around, Secound Round LP could eventually get my address and sue me. I am trying to avoid that process. I was thinking of contacting them but if they decide $300 is unacceptable, what could be my recourse? Should I try to negotiate down on the amount owed during the initial call as well?
Thanks,
Mary
So sorry to hear you are going through this. I think a lot of people on these boards can relate to your experience. Without knowing your entire financial ability/situation, here are some ideas I might consider if I were in your shoes. The first thing I would recommend is that you become familiar or reacquaint yourself with the laws as they relate to credit reporting/collecting debt (collection agencies). This could give you some understanding and awareness so that you are not being taken advantage of, and can also put you in a position of being more aware of your rights. ( I will try to remember to post a link or two below).
Secondly, take a look at your credit file and current expenses; ask yourself, what is the most I can afford as a downpayment offer - if possible - for this debt? And then, what is the most I can pay on a monthly basis if an agreement is accepted? I do not believe the CAs have to accept an offer from you. It is possible - and hopefully if I am wrong another contributor will correct me here - that they may have to accept anything you send in via mail. I had one collector declined my offer, so I mailed in payments 2x/month. Did they send them back? Nope. Once I got the balance down to a reasonable level, I ended the torture. Enough.
Finally, if you can broker a deal with a DP and monthly payment try to make it a PFD (pay for delete) condition. See if they can get something to you in writing; on a recorded line etc; preferably writing. Make sure your numbers are workable; make sure that whatever amount you can pay, you factor in unexpected things so that this is paid. One goal here is to prevent a lawsuit and subsequent judgement. I think by checking in here shows that you are like everyone else with an unfortunate situation that needs remedied. You are clearly committed to resolving this but it will take a little work. Don't get frustrated or discouraged. (I was sued and contacted the CA's lawyer, worked out an arrangement and dropped the suit)
If you haven't done so already, you could dispute the item. The law allows you do so and the CA has to respond within 30 days. Look at this item and see where there may be a discrepancy. Do you have a viable and valid dispute? Could it irritate the creditor (I'm being cyncial here) to a point where they fight it? I once disputed a similar item - a few hundred dollars - arguing that (a) I had no formal agreement/relationship with the CA (b) asked the CR to confirm that I have a legal responsibility to them for the debt and (c) asked for permanent deletion if they could not.
Some collection agencies will code the credit file noting the original creditor implying their ownership of the debt. CAs have to be licensed in your state to collect the debt. Do they want to go through providing proof to the CRA that they are licensed to collect? I don't know.
No fun having experience in this area, but I certainl hope this adds value and context to what you're doing. Continue to come to these boards. The information is valuable and effective. There are heroes here and we are all beneficiaires of their generosity.
https://www.ftc.gov/system/files/545a_fair-credit-reporting-act-0918.pdf
