CA is requesting more than original amount for PFD, should I go HIPAA route?

[SunriseEarth]

Advocation of the so-called "HIPAA Method" is not permitted on the myFICO Forums, so you will need to consult outside resources for questions on that.

As for the PFD offer, I think it's worth looking into Robert's suggestion to see if this is a violation.  If so, it might be worth a complaint to the CFPB, the BBB, and perhaps even the state AG's office.  

Even if they can legitimately make this offer, I wouldn't take it on a time-barred debt.   I'd probably throw them a really lowball offer to settle the debt and then send GW letters every month until they cave and delete the TL.  However, it's entirely up to you ask far as how much having that item removed now is worth.   

[Anonymous]

Well, bummer. The supervisor called me at work and asked if I was ready to pay off "The full amount you owe of $1,200" I told her that is not the full amount I owe, that I only owe $800. She sternly said, "No with fees and interest you owe $1,200." She would barely let me get a word in esdgewise so I told her what RobertEG said; "I read on the FTC's website that it is a violation of FDCPA 808(1) to collect on a debt for more than the original amount."

She was very rushed and just said, "So are you going to pay the full amount?"

I told her I would not pay $1,200 because that is more than I owe. I guess I will have to wait for it to fal off my credit report in two years and will have to send yo ua cease and desist letter?" (I was hoping that she'd agree to just the $800 I owe, honestly)

Her response was, "No need to send the letter, I'll note your account."

And then she hung up. 

Darn, I really did just want to pay the $800. Her tone was so frenzied, it did not go as I expected. I am honestly surprised that she wouldn't offer $800 in full. 

[Anonymous]

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@creditguy wrote:

I can't answer your question as far the HIPAA removal process but i will say this is a terrible offer. If you truly want the debt removed now then the call is yours to PFD. But if this debt is five years old you have passed the SOL in California for a lawsuit. The CA really has no leverage to get you to pay that amount unless they sense desperation. If it were me I'd say no deal, the debt will fall off in a few years, the ball is in their court to come back with a better offer. They are simply milking you on these incurred fees, what a joke. And finally if there is no deal in writing then there is no deal, never just take their word for it.  Good Luck with whatever you decide to do. 

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Exactly! As soon as they smell blood in the water they will dig in. ALWAYS try to negotiate from a position of strength, not weakness or desperation. If the first thing you bring up is your desire to "get this off my reports", you've just filled the tank with blood, and the sharks will begin circling. The first thing out of your mouth when trying to negotiate a deal should be the phrase "this is a time barred debt" -  let them know immediately that you *know* they really have NO strong bargaining position to begin with.

I would never get hung up on not getting it in writing. A verbal agreement is fully binding under the law and they ARE recording the conversation - that means you may freely record it as well.

[Anonymous]

OP, read up on collections in mortgage section. I thought I read that FHA loans dont require collections under 1k to be paid and something else about medical not being as big of a factor.

[Anonymous]

Yeah, I definitely didn't play my hand to its full potential. Hopefully others dealing with California Business Bureau will read this and have better luck! In the end, CBB loses too because I was offering to pay the full amount. I am still a little baffled that it was $1,200 or nothing. (especially when they offered $300 several months ago) This is my only collection on my credit report (it's from 2010) so we will see what happens when I go for a mortgage. \_(ツ)_/¯

[Anonymous]

Thanks, work_in_progress2, that is what I am hoping for! I will update again here in a few months for posterity so that others can be helped.

[Hokies2379]

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@SunriseEarth wrote:

Advocation of the so-called "HIPAA Method" is not permitted on the myFICO Forums, .   

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I've always wondered why this is, but never cared enough to go searching for the reason.

[Rebuilding69]

It's 1200 or nothing because they still have 2 years to screw with you & think you will give in before that timeframe.

[Anonymous]

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@Anonymous wrote:

Yeah, I definitely didn't play my hand to its full potential. Hopefully others dealing with California Business Bureau will read this and have better luck! In the end, CBB loses too because I was offering to pay the full amount. I am still a little baffled that it was $1,200 or nothing. (especially when they offered $300 several months ago) This is my only collection on my credit report (it's from 2010) so we will see what happens when I go for a mortgage. \_(ツ)_/¯

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Mortgage lenders just care that the debt is settled and not open.  They dont insist that it be PIF.

I do understand your line of reasoning in that if it was off your reports you would have a good chance of better terms.

If it were my debt and I wanted it settled, I would take into consideration it was time-barred, so their chance of getting the courts to help recover the amount is over, so the debt is devalued.

The closer it gets to the 7 year mark when it will not be shown on standard CRs, the lower the value.   The longer it goes unpaid, the lower the probability it will be paid, from a CA perspective.

My suggestion - let them cool off for a few weeks.  If you have the 300 offer in writing, dig that out, copy it, and send that by mail to them (CMRRR) and offer to pay that immediately after their written acceptance for full settlement.  Put a time limit on the offer, like 7 days.  If that doesnt work or it is ignored, consider another offer of 400.

There is plenty of time to get it handled and you shouldnt feel rushed.  When the mortgage lender pulls your CRs and its removed, it wont say 'removed 12 months ago', it will just be gone.  So no advantage if its gone 12 months ago or 1 month.

When you get a settlement, then pursue the whychat method.

By all means, do not drive an hour each direction to confront them in their home territory with a home team crowd.  I dont see anything good coming from that visit. 

HTH

[Anonymous]

WOW! I just got an alert through MyFico that California Budiness Bureau added an Installment Loan Inquiry to my credit report! Can they do that?! What recourse do I have?!