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Posted by: BigPete on 2006-04-24, 22:55:21
The term "sue " has scary connotations, but what they would do is obtain a judgment. It is relatively easy and inexpensive (for them). There is no "Law and Order " type trial scene. They would provide the necessary documentation to a court to verify the legitimacy of the debt. Having a judgment gives them options to pursue liens against any assets you may have and levies against bank accounts. Once a judgment has been issued, they can often just take the money from your account if you have it. What you need to worry about, is that judgments stay on your credit report for 7 years. It is a big-time stain on your credit rating. That being said, most collections agencies won't pursue judgments on low-balance accounts. Depending on the industry, a low-balance could be anything under $250 or anything under $10000. I don't know enough about your situation to be comfortable telling you that they will or will not take legal action. Here's the good news. Collection agencies often buy the debts from creditors for a small percentage 25-50% of the actual amount owed. That means that they are likely to make a compromise on the account. If you offer to pay 75% of what you owe, they'll usually take it. In some cases, collection agencies work on a commission based on dollars collected, or accounts worked. In the former, they may not have as much leeway to compromise an account, and you would have better luck dealing with the original creditor. In any case, your best defense is to not be intimidated. Let me say this once and clearly. If you owe the money you have to pay it! One way or another, you have to resolve the account, and if it's a large enough amount, they will come after you. But here's why it's important to not be intimidated... they are not in the business to intimidate, they're in the business to make money. If you show a sincere desire to pay the debt, even if you are unable to pay it off in any reasonable amount of time, they will work with you. They don't want to sue you. They don't want to report you to a credit bureau. They just want the money. If you realize that, and are willing to work with the collector, they are a lot less scary. Try to find a person that you deal with regularly at the collection agency. If you talk to someone about making arrangements to pay, ask if you can call them directly when you have problems with your account. If you're going to miss a payment, call that person before the due date and tell them. Once you've got a relationship with them, they are much more likely to be helpful than threatening. That being said, if they are truly harassing you or are abusive, the Fair Debt Collection Practices Act provides protection for debtors. ftc.gov/ os/ statutes/ fdcpa/ fdcpact.htm If you look this over and feel that they are violating the law, you may want to contact an attorney and have them deal with the collection agency. |
