Can I get money back from a collection agency for payments made (in error) AFTER the debt was closed?

Question

One of my family members had a debt of $6700 from 2004. She did not start paying on it until last year (Late 2006). She has paid about $1800 toward it since then, but here's the catch:

After pulling her credit report this week, it showed that this collection debt was actually closed in 2005 and has had a $0 balance since then.

I am interested in helping my family member get this money back from the collection agency, since the $1800 she paid to them was paid *after* the debt was already closed with a zero-balance and reported on her credit.

1) What would be the best way to approach the collection agency about getting this money back?

2) If they refuse to return the total of these payments, what could be the best course of action to further pursue the matter or convince them they must return the money?

Thanks to all of you, in advance, for any help & suggestions you can provide.

Answer 1

If the original creditor (OC) is the one who is reporting a zero balance, that does not mean there is still no money owed.
If the OC is showing a zero balance that only means the OC had sold the debt and is reporting correctly.

If the collector (CA) is reporting a zero balance and the account was never paid then it's possible that that CA had sold the account to another CA. If that is the case the CA has no legal right to either collect "any" money or to report the account on her credit reports.

So, without knowing actually which company is reporting the zero balance, etc. -

She should send the CA a debt validation (DV) letter. She should include in the DV the request for proof that the CA currently, and at the time the payments were made, owns or was assigned the "alleged" debt.

If the CA did not have ownership/assignment of the alleged debt at the time she made the payments then the CA is in violation for accepting and keeping the payments.

IF that is the case I would recommend speaking to a "consumer credit" lawyer since the CA would not only owe her for the payments she had made but also for the violations they committed.

You might click on my profile and do some reading in the link I have listed to the FDCPA and also in the last link to the free to use credit discussion board.

Answer 2

Of course Echo is correct.

Also your family member was awarer that she/he owed the debt, otherwise they would not have made payment agreement.

If you want some information about verifying a debt, here is a very user friendly site.

http://www.creditinfocenter.com/forms/sampleletter17.shtml

Answer 3

I think you may be confusing this. The reason it is reflected on the credit report as $0 is because the original creditor sold the debt to the collection agency. The debt is still valid and collections company is still expecting payment on it.

Answer 4

debt was sold. still due