Can I be forced to settle a debt with a collection agency instead of the original creditor?

Answer 1

Lets get something straight.

You have no legal obligation to even talk to a collection agent. Your debt is to the original creditor.

Whether the creditor wants to continue to negotiate with you is up the them. If they refuse, then you will either have to deal with the collection agent or just ignore the debt.

Any "obligation" that is made is between the collection agent and the creditor.

Therefore, ALWAYS contact the original creditor to see if you can work out a deal.

Answer 2

Don't panic. :) Although you do have to settle the debt with the collection agency, you don't have to allow yourself to be harrassed and pestered on the phone.

Here's a very legal step you can take. It's easy, it's legal and I've personally done it.

If you don't have it, get the address of the collection agency. Then write a letter that states that you do not want to have any phone contact over your debt. You prefer to have all your contact through the mail only.

You can tell them how much you can afford to pay and when you'll pay it if you like. That part is up to you. If the creditor is represented by a law office, usually this happens when it involves a car or a type of secured credit debt, then you may want to make the payment arrangement over the phone and request the lowest payment you can afford. Many times the creditor can lower your interest as well. Don't hesitate to ask for that.

In addition, let's say your cercumstances change and you can afford to pay it off early - NEVER OFFER THE ENTIRE AMOUNT!

Let's say you owe $4,000, call and offer $1500.00. They will counter offer. If they don't budge, you can counter offer. Negotiate your debts. Negotiate for lower interest rates, lower payments and the payoff.

Just remember, if you do not want to deal with the phone calls, you can request that they do not call you. Don't bother trying to get them to stop by requesting it on the phone. They know your rights, but they don't want to stop calling as that is a more effective way to get people to pay.

Just ask for the address of where to send your payment and then mail the letter. They must compy. You may receive another phone call after you mail the letter. At that time you can inform the caller that you have mailed in a request to stop calling and only deal with you by mail. Ask them to make a note of that in their records.

Once they receive the letter, they have to stop. They may call you again to tell you your status has changed, but they cannot call for collection. Usually, you'll never hear from them again, accept by mail.

Answer 3

Yes. Typically collection agency's purchase bad accounts from companies for less than they are worth, ie they pay $25 for a $100 debt. Then they try and get as much money for it as they can. At this point they own the debt and not the original company.

Answer 4

Yes....the collection agency is in fact, acting as the creditor's attorney and has all the powers granted to the original creditor.

Answer 5

Yes . . . this is what we call the consequence of waiting until the 11th hour regarding delinquent debt.

You see, you can't be the big baller -- the shot caller -- when you haven't handled the delinquent debt before it is referred to a collection agency.

You have the best POKER hand BEFORE it is charged off.

You will have to charge this one to experience.

Answer 6

You sure can.

And you will be pressed hard for the money.

That's how the collection companies make their money.

They don't care how much it cost them to get the money because
they can add some of their costs to what you already owe.