Old private student loan collection - the sharks are back - HELP!!!!

[Anonymous]

So, about 5 years back I started my credit journey from the bottom of the ocean. Like my dark surroundings, I knew nothing of the bluer credit waters from above. 

I had my credit report, and saw student loans on there that were all in default. I didn't really know the difference between federal subsidized and private. I would soon get a crash course.

I somehow "remembered" the name of something I had seen on my credit, for USA Funds. I called them, and they informed me that yes indeed I had some back owed loans and yes indeed they'd be more than happy to make a deal. I made a deal and agreed to a payment, gave out my checking account number, and went home to do a bit of reasearch. Cart before the horse, you say? Oh yes, indeed!

I pulled up my CK and couldn't even find the USA Funds from my memory. In a panic, I started reading and researching like a death row inmate who was really innocent. I quickly learned that the USA Funds was private and had aged off of my report. I was paying off some zombie debt. So...I called my bank and cancelled the check, just in the nick of time.

I got the call from the angry collector the next day: "We had a deal, and you owe us the money. You owe my client, regardless of wheter or not it's collectable." I nicely repsonded that there is a time and place to atone for past sins, and this was not that time and not that place. Money was scarce and I wanted to really improve my credit, this would not have helped in the least. His final ominous reply: "I hope you read all about how collections work." I shuddered, because I had read something about regurgitating old debt by saying something stupid or doing something stupid. I had done both, but it was over 7 years old so I wondered...

Fast forward to nowadays. I received a few collection letters over the years, a call here or there, nothing brazen or crazy. Until about a week ago. A new collection agency took over the old debt, and it almost feels like they caught a whiff of something green and they've been calling me, auto calls that a legal action may be filed against me, one brazen agent, when I told him that I was in fact The Donald, said "This guy thinks were joking! Wait until he sees the judge!" 

The intensity as of late has me worried, and therefore, here I am, back where my credit journey started. Seeking ONLY true wisdom from all you who know. My biggest fear is that this old debt was re-triggered and they could actually take court action against me, even though it's been about 12 years. Action due to the cancelled payment and whatnot...

I submit my question and will await your sage responses and I'm appreciative of any nuggets that will set my mind at ease, or encourage me to take action now. Thanks!

[Anonymous]

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@Anonymous wrote:

So, about 5 years back I started my credit journey from the bottom of the ocean. Like my dark surroundings, I knew nothing of the bluer credit waters from above. 

I had my credit report, and saw student loans on there that were all in default. I didn't really know the difference between federal subsidized and private. I would soon get a crash course.

I somehow "remembered" the name of something I had seen on my credit, for USA Funds. I called them, and they informed me that yes indeed I had some back owed loans and yes indeed they'd be more than happy to make a deal. I made a deal and agreed to a payment, gave out my checking account number, and went home to do a bit of reasearch. Cart before the horse, you say? Oh yes, indeed!

I pulled up my CK and couldn't even find the USA Funds from my memory. In a panic, I started reading and researching like a death row inmate who was really innocent. I quickly learned that the USA Funds was private and had aged off of my report. I was paying off some zombie debt. So...I called my bank and cancelled the check, just in the nick of time.

I got the call from the angry collector the next day: "We had a deal, and you owe us the money. You owe my client, regardless of wheter or not it's collectable." I nicely repsonded that there is a time and place to atone for past sins, and this was not that time and not that place. Money was scarce and I wanted to really improve my credit, this would not have helped in the least. His final ominous reply: "I hope you read all about how collections work." I shuddered, because I had read something about regurgitating old debt by saying something stupid or doing something stupid. I had done both, but it was over 7 years old so I wondered...

Fast forward to nowadays. I received a few collection letters over the years, a call here or there, nothing brazen or crazy. Until about a week ago. A new collection agency took over the old debt, and it almost feels like they caught a whiff of something green and they've been calling me, auto calls that a legal action may be filed against me, one brazen agent, when I told him that I was in fact The Donald, said "This guy thinks were joking! Wait until he sees the judge!" 

The intensity as of late has me worried, and therefore, here I am, back where my credit journey started. Seeking ONLY true wisdom from all you who know. My biggest fear is that this old debt was re-triggered and they could actually take court action against me, even though it's been about 12 years. Action due to the cancelled payment and whatnot...

I submit my question and will await your sage responses and I'm appreciative of any nuggets that will set my mind at ease, or encourage me to take action now. Thanks!

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Unfortunately, once you agreed to a payment arrangement and set up a payment plan, that unfortunately reset the SOL to be sued.

What is the SOL on this type of dent in your state? I would find that out first. I would also consider the amount of the debt and the closer to the end of the SOL, generally the more intensive they become to collect on said debt, and may likely become litigious. If you are withing the SOL, you may want to consider figuring out something to settle or make a payment plan (that you can stick to realistically)

Since it is a private SL, the reporting period has passed and they cannot reinsert themselves (OC or CA) into your CRs and cannot be re-aged so there is at least that going for you.

Good luck!

[calyx]

I'm here to echo what LaHossBoss said.

Look up the Statute of Limitations (SOL) on debt is for both the state you live in and the state of the collection agency.   Sometimes they'll try to take people to court based on where the SOL is most advantageous.   5 years is a pretty good stretch, so at least you have that going for you.   And just to be clear:  the 7 years is for CRA reporting, SOL is for taking legal actions to collect upon the debt.   You still owe the debt, it has just become unreportable and may have aged out the chances for them to sue you for it.

It's not unusual for collection agencies to check credit reports for debt and if they see a marked improvement, to try to get more "enthusiastic" about collecting on old debts since many people are unaware of SOLs, reporting, etc.   So them calling, if you've been improving your credit history/scores isn't terribly unusual.

Good luck.