What would YOU do with this...?

[Anonymous]

Hi y'all...

Back on Feb 14th, I sent out a batch of 5 DV letters. One was to Consumer Recovery because they are reporting I owe a debt to them (as of last year and only on EX) but it's the same debt/account number for a an account with GE Money as ANOTHER CA - Equable Ascent (they've been reporting on all 3 of my CRs since 2008 and still are). Quite honestly, I wasn't even sure what debt that was at first. The balance was close ($1 off) to a "balance due" for GECRB/Care Credit. However, GECRB/Care Credit still shows I owe that balance and NOT as $0.

Since Consumer Recovery is the newer of the posted collections for this same account number with GE Money, I DV'd them (was going to DV Equable after I got this one cleared up).

Fast forward to today. I get a letter in the mail from GE Capital Retail Bank (who I never contacted and can deduce is GECRB/Care Credit). It says:

Dear "you":

Thank you for your recent inquiry regarding your credit card account.

We have been unable to locate your record with the information provided. We would like to handle your request, however, we ask that you please provide your account number in order to assist us in finding your records. Your account number is reflected on your credit card or on a past billing statement or may be on a copy of your credit bureau report.

Please return your correspondence to us, along with your account number and we will promptly address your inquiry.

Thank you for your assistance.

Sincerely,

Customer Service Department

Okay, a few things here. I think it's obvious that, since I didn't contact GECRB, that the CA did. So why are they writing to ME? Also, this wasn't a credit card - it was an account my vet had me apply for back in 2005 so I could save my dying animal by giving her a blood transfusion.  I don't have a card to get an account number from. I don't have any old statements because this was in 2005, when I lived in another state...that info and those statements are long gone in my lack of organization and memory lol.

As for the account number from the CRA, as you all know, they don't give an entire number, so when I contacted the CA, I gave them the partial, my name, and my address.

If this happened to you, what would you do? Re-write the CA? Respond to the letter from the OC? And, also, what do I do about the OC still reporting a balance due, an older CA reporting a balance due (on all 3 CRs), and then this new one that I'm trying to get to verify, who is reporting the SAME balance on one CR?

What a mess lol

[RobertEG]

You sent a DV to the debt collector.  That DV, assuming it was timely, invoked an automatic cease collection bar on the debt collector.  So, legally, the debt collector is barred from communicating with you regarding their efforts to collect the debt until they provide adequate debt verification.

I would guess that the debt collector may be having problems in their debt verification efforts through the OC, and the OC is not able to provide the needed verification.

So rather than commit a violation of their cease collection bar,they have consorted with the OC to contact you.

It is their duty to obtain verification from the creditor, and not your obligation to provide such documentation.  FDCPA 809(b).

They initiated the collection, and they have means to get it through the OC. I would not send them anything.  I would not respond to the OC.

I would simply consider them to still be under your imposed cease collection bar, and leave it to them to obtain the requested debt verification from the OC, as required of them under the statute.

As to the issue of both the OC and debt collector reporting a balance, there is nothing inherently improper.  As long as the OC still owns the debt, they can report the balance of debt due to them.  The debt collector can also report the debt.  That is not double-reporting of the debt, as the OC is reporting the balance owed to them, and the debt collector is reporting the debt that they are attempting to collect.  Very common.

[Anonymous]

So, what you are saying is that a CA doesn't have to own a debt to report it on your CR? And if the CA doesn't own the debt and I pay the OC, what happens to that CA TL? Wow, this is so confusing to me. I thought I was starting to understand everything better. If there are rules for Fair Credit Reporting, it doesn't seem "fair" that multiple listings for the same debt can be reported. I'm not saying it's wrong if it's not, but it definitely seems "unfair."

[RobertEG]

No, a debt collector does not have to own a debt to report to a CRA.

An OC can either attempt to collect their own debt, assign collection efforts to a debt collector while retaining ownership, or sell the debt.

What a debt collector reports to the CRA is their collection on a debt the consumer incurred with another.  If the debt collector also has purchased the debt, they are still collecting on a debt you incurred with another, so are still considered a debt collector, but they then also become the owner.  Either way, their reporting to the CRA is of their collection.

When an OC still owns the debt, you could legally pay either the OC or the debt collector.  However, many agreements between an OC and a debt collector include specfic provisions that any payment on the debt must be received via the debt collector.  It is their internal business agreement.  So often an OC will not, and cannot, accept payment, even though they still own the debt.  If the OC refuses to accept payment, that is their option.

When the OC still owns the debt, both the OC and the debt collector can report a balance in their respective reportings.  The balance reported by the OC reflects the DEBT owed to them, while the balance reported by the debt collector reflects the balance they are COLLECTING.  While they appear to be duplicative reporting, in fact, they are not.  They reflect different things.  If both the OC and debt collector have reported, then if the party you pay agrees to delete their reporting, that does not compel the other party to also delete.  A party can only agree to delete their own reporting.  If you pay the OC, you can request that they ask the debt collector to also delete, but the OC cannot agree to or compel the debt collector to delete their own reporting.

If the OC sells the debt, they must then update their reporting to $0.  They no longer have debt owed to them.  The party who purchased the debt still reports the balance in their collection reporting, but it now reflects BOTH debt owed to them and debt they are collectiong.  Once the OC has sold the debt,they cannot accept any payment.

[Anonymous]

Believe it or not, I actually understood everything you just said (I know..I'm slow sometimes lol). THANK YOU so much for explaining that to me. I "get it" now.

Well, the OC must still own the debt since they are still reporting the balance owed. I'm not sure what the deal is with this new CA that is only showing on one of my CRs.

I'm going to just respond to the OC and ask them if they still own the debt and if I can work out a payment option with them, I guess.  Is that what you would do?

[RobertEG]

Here is your scenario, as I understand it.

You have a valid debt with the OC, who still owns the debt, but has referred it to a debt collector.

You have DVd the debt collector, and they have not yet provided debt validation or reported their collection.

The OC wrote you, asking for information that is apparently needed for them to verify the debt back to the debt collector (my presumption).

You plan on paying the OC.

If that scenario is correct, I would begin by placing a telephone call to the OC rather than sending them a written request, as they have an outstanding written request pending response from you.  What such a written response might lead to vis-avis debt validation by the debt collector is kinda murky.

If you feel out the OC, and they are willing to accept payment, the debt will then be gone.  Thus, the debt collector will have to close their collection and report a $0 balance under collection. 

All of that would probably work to your favor with one exception.  While paying the debt will force closing of the collection, it wont necessarily prohibit the debt collector from still reporting their collection to the CRA.  They did have a valid collection, and the fact that it would be closed would not necessarily bar them from still reporting it.

However, in my opinion, that is not likely.  They would achieve no collection purpose in such reporting, and would have to simultaneously report both an open and closed collection with a $0 balance under collection.  Kinda silly on their part, but not prohibited.

I would take a shot at paying the OC, and bank on the debt collector not reporting to the CRA.

[Anonymous]

I am definitely going to do what you just suggested. That makes complete sense to me. Thank you again for your help with this, Robert!

[rkelley3]

Forgive me if I don't subscribe to the same conservative interpretations of the law as other posters but I think it is definitely illegal to record the same debt twice on your credit report.  I've never had a problem having that cleared up quickly with the CRAs.  I'd just dispute with the CRA's and tell them that a single debt is being reported twice.  They won't remove the OC but they will remove the CA.

[jaypeedee]

I would dispute the CA with CRAs.  They obviously cannot prove the debt, which is why the OC is trying to get the info out of you.  The CA will most likely be taken off of your CR.  THEN you call the OC and request a PFD.  Good luck.

[Anonymous]

Thanks so much for the advice everyone! I appreciate it so much. I'm going to find out if the OC owns it and then go from there but I probably WILL dispute at least one of the CAs (the one I sent the DV to).  I agree, they obviously can't validate it. I'll let you know what happens....