Finance Assistance

How do you tell if your account has been turned over to collections? Your credit report is an excellent place to start. If you haven’t already done so, getting a copy of your credit report is crucial. To obtain a copy of your credit report, you may contact the credit bureaus at their websites:

http://www.experian.com
http://www.transunion.com
http://www.equifax.com

If a collection account is not listed on your credit report, then I assume you are reading this document because an agency has either called or sent you a letter, demanding payment.

As with the debt settlement techniques we gave you when dealing with the original creditor, let’s just break this down into manageable steps. You need to determine:

1. Identify debts
2. Check statute of limitations
3. Who to contact
4. How to contact the collection agency
5. How much to offer
6. Tips on paying once you arrive at a number
7. Negotiating your credit rating

Before you attempt to settle a debt, check the statute of limitations

Collectors only have a certain amount of time to sue you for payments. The first thing you should do is to determine if the statute of limitations for collecting a debt in your state have past. If the debt is older than the statute of limitations, you tell the bill collectors they are wasting their time by harassing you for an uncollectible debt, as the original creditor or the assigned collection agency cannot take you to court to get a judgment.

Can the debt still be reported on your credit report?

After 7 seven years (in most cases), a debt will disappear from your credit report. If the reason you want to pay this debt off is to clean up your credit to purchase a home, and you can challenge the debt on your credit report, why pay this off? Your creditors have not bothered to sue you until now, it’s likely that they won’t in the future, either. Credit repair is beyond the scope of this book, but most types negative information come off after 7 years. You can challenge this listing on your credit report and it will come off.

Please note: the amount of time a late payment can appear on your credit report has nothing to do with the statute of limitations. Very important distinction. Even though a debt may no longer legally appear on your credit report after 7 years, you could still be sued for the debt because the statute of limitations for your debt in your state is not up.

If the debt is gone from your credit report AND the statute of limitations is up on this debt, you’re home free!

If enough time has past for both the legal debts collection statutes of limitations and the credit report limitations has passed, don’t worry about the debt! If your debt meets both of these conditions, it is uncollectible and it cannot appear on your credit report! If you get to this point, stop here, you are done! You can stop reading!

Who do you contact?

he best place to look for information on contacting a collection agency is your credit report. We gave the website addresses in the section above.

If you’ve been unable to get the address and/or fax number for the collection agency, here are some on-line resources:

The Better Business Bureau
http://www.bbb.org

http://www.millcbs.com/search.asp
http://www.411collectionagencies.com/AGENCIES US/
http://www.residentagentinfo.com

You could also try your secretary of state, who has a list of all businesses in the state and their contact info. Look up the secretary of state’s number in the phone book or call information.