Monday, February 20, 2012

Credit Scores and Debt

There can be a lot of confusion when it comes to credit scores.  First of all, there is more than one credit score.  The most popular is the FICO score.  However, each of the three credit reporting agencies has a different formula to calculate the FICO score, resulting in higher and lower scores for consumers.

Second, a credit card company may use a different score to approve a loan than a home mortgage lender or auto loan financial institution would use, so the lenders are not consistent with the scores used to accept applications.

Another problem resulting from the recession is that many consumers have had their inactive credit cards closed by financial institutions.  This increases the outstanding debt to the available credit ratio, resulting in a lower credit score.

Outstanding uncollected debt that is older than seven years will be removed from the credit report.  Therefore, if you are being harassed by debt collectors and you make a payment because you think it will stop them from calling, then the clock on the time limitation will restart.

If you are being harassed by debt collectors, please contact us at 866.553.3272.

Friday, February 17, 2012

Debt Collector sends elderly woman to the hospital.

Anne Sessions had always paid her bills on time until 2010 when she had financial problems and was facing foreclosure. Wells Fargo debt collectors began harassing her with telephone calls and threatening to take legal action. She was able to work out a payment plan with her modest fixed income.

The harassing calls ceased until February of 2011 when a debt collector began harassing her even after she explained she had already set up a payment plan to pay off the three months she was in arrears. She told the debt collector that this type of harassment is what leads to people abandoning their homes and in some cases, committing suicide.

The debt collector continued to harass Ms. Sessions and asked inappropriate questions about how she might kill herself. Three police officers arrived at her home and told her that the employee had called 911 and reported she had threatened to commit suicide. The police forcibly took her to an emergency room where she was held for several hours, reviewed by medical staff and released. She later received a bill from the hospital for $1,055.

Ms. Sessions contacted the company to speak to the debt collector and was told he was unavailable but heard the co-worker laughing as she congratulated him on how effective his call had been and that the police had taken Ms. Sessions to the hospital. Ms. Sessions said the incident caused her extreme anxiety and embarrassment. She is suing for $250,000.

If you are being harassed by a debt collector, contact us at 813-314-4595 or 866-553-3272.

Thursday, February 2, 2012

Asset Acceptance, A Debt Collection Company, Will Pay $2.5 Million Fine

Asset Acceptance, a debt collection company, had been contacting consumers trying to collect debts that were not owed. In some cases, the debt was too old to collect because it was past the statute of limitations. If the consumer was to make a payment on the old debt, the clock on the debt would be restarted allowing debt collectors to take legal action.

The Federal Trade Commission states that Asset Acceptance has agreed to pay a $2.5 million fine. In addition, the debt collectors will have to tell consumers that their debt is too old to legally enforce, and the company will not be allowed to enter the debt on the consumer’s credit report without informing the consumer first.

For more information on your rights, contact us.