Can a collection Agency turn down the offers of a payment plan?
Any help on this topic would be greatly appreciated. I got a notice saying that the amount owing on my credit card was now with a collection agency. I contacted the agency I owe 1300 dollars. They told me I had until monday ( 72 hours from now ) to send the amount in full or they will take me to court. I told them that I don’t have 1300 dollars to send them but I could afford to send them 100 dollars a month until the debt is cleared. She told me that I was not entitled to a payment plan of any sort. Is this true?? Or is she just playing hardball ( I have nothing against her I know its her job), but I m just wondering what my rights are. Specially since I m more then willing to pay the money to them. I just cant afford to do it all at once. Any help again would be greatly appreciated. Thanks in Advance.
I live in Canada if that makes a diffrence as to what a collection agency can or can not do.
I am not familar with the law in Canada, so I can only speak to how things work in the U.S. If the laws are similar, then I hope this answer will help.
Collection agents hit a particular nerve with me, so I am especially aware of what they can and can’t do.
First of all, incase you didn’t know, collection agencies make a percentage of the debt they collect from you. That said, they have an incentive to get you to pay the full amount. The fact of the matter is, often times you don’t owe the amount they say you owe (i.e. it’s been padded with collection fees, incorrect interest rates, etc) and they will violate the law till the cows come home if it means they think they will get paid. Just based on your story at this point, they have already committed one violation. A collection agency can’t threatnen to do something they cant really do. In your case, that threat was to take you to court. That’s not to say a collection agency can’t sue a person, they can. But in order to do that, they would need to own the debt as opposed to be collecting it on behalf of the creditor. So, if they are just collecting versus actually own the debt, THEY can’t take you to court. Further, even if they owned it but have no track record of litigating cases, they are esentially threatning something they dont do. The case law on this matter, specifically, has found that collection agencies who threatnen this without the track record to back it up, are committing an FDCPA violation.
First things first, you need to send this company a debt validation letter and ask them for proof that YOU owe this debt and that you owe the specific amount they claim you owe. You want a calculation of how that figure was calculated. You also want copies of any original documentation showing you are the owner of this debt (signed contract,etc). A spreadsheet from the collection agency with your name, address and some account details IS NOT validation and should not be accepted as such. when creditors sell debt to debt buyers, they provide the info on a spreadsheet, they do not supply all the original documents. That’s why you usually get a spreadsheet from a CA (collection agency). The FTC has opined that a spreadsheet is NOT validation. Until they have properly validated (emphasis on “properly), they can’t continue to collect. That said, they must also notify the credit bureaus that the account is in dispute. If they dont’ report that, that’s an FCRA violation. If you send your validation letter certified mail, you will know when they received it. Not only willyou then be able to start your 30 day clock (they have 30 days to provide proper validation) but if you get a credit monitoring service that allows you to pull your credit daily,you will be able to see if they have in fact notified the bureaus that its in dispute or not.
Next, a lot of states require that collection agencies be licenses in your respective state. If they arehnt licensed, they can’t collect.I can’t tell you how many times I have caught agencies who are trying to collect when they are licensed in my state (florida). All it takes is one letter letting them know you’ve done your research and knwo they aren’t licensed and you will most likely never hear from them again.
Yes, they are not REQUIRED to take a payment plan,but in reality…they will. Again, they want thier money, even if it comes in chunks. If you pay one lump sum, they get their commision today, as opposed to over time. So, naturally, they tell you there is no payment plan. Know that they buy debt for pennies on the dollar, literally. So, for your $1300 debt, they may have only paid 10%,who knows…they will never tell you that (and it depends on how old your debt is. the older it is, the cheaper they buy it for).
As far as what rights you have, again, this is going to depend on what the law in Canada says. In the US, there are TONS of things they can’t do and things they must do–from the times of day they can and cant’ call you at, who they can talk to, what thier lettes must say. Do a google search on FDCPA and you will get a good idea of these. Hopefully, the law in Canada is just as strong.
I could go on and on ( i told you that CAs rub me the wrong way!), but I will probably lose you at some point. Just know that you do have rights and they will try to abuse you any which way they can in order to scare you into paying. Hold your ground and play thier game. Make them provide the proof and if they can’t, tell them to pound sand.
