Do collection agencies retain the contract once you pay them or do they assign back to creditor?

[Anonymous]

I recently settled a large collection >12k. It was assigned to an agency and not actually purchased by an agency. Once the agency collects and reports to the OC, do they retain the contract or return it to the OC?

[Anonymous]

The agency is Monterey financial , they collected on a contingency basis and did not purchase the contract.

[gdale6]

They dont assign it back to the OC once its been paid.

[Anonymous]

Thanks. I was wondering who would be responsible for reporting to the CRAs. Based on your answer I understand that Monterey will continue to be the one to report the account to the CRAs.

[RobertEG]

If an owner assigns collection authority, they retain the ownership and are only assigning the right for the debt collector to conduct collection activities on their (the owner's) behalf.

If the assignment contract is terminated by either party, the debt collector does not assign the assignment back to the assignee.

The collection authority (assignment) is simply terminated.   

It is commonly recommended that the consumer request the creditor to recall the debt if they still own it.  That is a misnomer, as if the creditor owns the debt, it never passed to the debt collector.  All that passed was the authority for the debt collector to act on behalf of the creditor in pursuing collection of the debt.  All that is "recalled" is the authority to continue to act on behalf of the creditor.

What is recalled is the assignment of collection authority, and not the debt.

[Anonymous]

Thanks for the reply. I was considering a GW request to delete the tradeline and since it’s only reported by the collection agency, not the OC, I guess I’m stuck in requesting that through the OC, even though they no longer have authority over the account. Is this correct?

[RobertEG]

In the posted scenario, the OC still owns the debt but is not reporting to the CRAs.

The assigned debt collector has reported a collection on the debt.

Since there is no reporting by the creditor, there is no basis for any request directed to the creditor for deletion.

Only the party who has reported information can delete their reporting.

Deletion of the collection would be attempted either by way of a pay for deletion offer prior to paying, or by paying and then making a good-will request for their deletion of the collection.

[Anonymous]

Thanks. That’s the route I’ll go