Question for Anthony :-)
Can a collection agency make "hard" inquiries on your credit report (like every two months)? The debt is past the SOL and is over the 7 year limit (it dropped from my credit report about two years ago).
Thanks for any info!
In answer to your question, a collection agent could make inquires after SOL and reporting limits. The real question is why would one do so considering the liability potential? It’s called “poisoning” an account and is done by more unscrupulous collectors, sometimes without the consent or knowledge of the collections manager. Keep in mind, this is an old school tick and serves a purpose so far as collections are concerned.
The theory behind “poisoning” is to make collection activity known to potential creditors, since they can no longer report the status in detail. Under permissible purpose guidelines the inquiry can be placed, whereby it’s existence alerts potential creditors to collections activity. Most lenders don’t consider these legit, but some (like mortgage creditors) may question the issue. It’s a sleazy thing, I know, but nonetheless done on occasion.
The poisoning method is also intended to get your attention, which it has, so that you’ll contact the agency and attempt to have such inquires removed. The general premise is that when you call to gripe the agent can then hammer you for payment, allege a reset, or threaten more activity if the debt isn’t paid. It’s an intimidation tactic that sometimes produces results, but more often ends up with heat for the agency.
Yet this is highly questionable conduct one is almost forced to address, perhaps in a forceful manner; like having an attorney draft a simple demand letter that they stop. (The latter could run you anywhere between $25 to $100 bucks, depending on the lawyer.)
The collection agency will likely contend the inquires were run to obtain current contact information, but this is an edgy defense. Of course if the amount of the debt is sufficient enough, the collection agency may feel the gamble is worth it. Personally, during my days in collections management, I never found it cost-effective to keep old (stale) accounts in the general queue.
Your best bet here might be to obtain counsel (on a limited basis), have the lawyer compose a warning (desist) letter, and chock it up to experience. Because if you contact the agency directly, they may attempt to allege a statute reset and then you’ve got a bigger problem.
Keep The Faith,
RE: Collection Inquires
Thank you for this information! I have two collection agencies doing this to me through two CRAs. I will try and figure out what to do (if anything) but I definately will not call them.
Thank you again for your time in answering this question!!!
Here’s Another Tactic…
May I suggest you contact Pre-paid Legal services at: http://www.prepaidlegal.com and consider signing up for the services, which I believe run about $35 or $40 bucks per year. Since you’re dealing with more than one instance/collection agency, the flat fee for PPL would seem far more cost-effective than paying an attorney per-demand letter issued.
As I understand PPL services you may request as many such letters as necessary, and if you’re out to clean up a credit report this may be the way to go. Hay it’s just a thought to possibly save you some money.
Keep The Faith,
Anthony: question of practica
Anthony -by reading your posts, it's obvious that your information is grounded in the real world and not in the ivory towers of "the law says..." So, concerning poisioning, I have a question:
Assume that there is a collector who, through malice or incompetence, continues to do a hard inquiry on a debt with an expired SOL and past the 7-year CRA reporting period. My contention is that you could write a letter stating that they cannot sue and the debt cannot be posted to your credit report. You also tell them that (for whatever reason), no remittance will be forthcoming from you. It follows (in my mind) that any further hard inquiries could be contrued as harassment (or perhaps even libelous, as I could argue that their activities malign my character in public) and argued as such. It would seem that if you spent the money on good counsel, that it would be easy to prevail in court.
However, IN THE REAL WORLD, which you seem to operate in....is it that easy? (I guess not). It seems so cut and dried, to my way of thinking.
RE: Question for Anthony :-)
IF A COLLECTION AGENCY IS MAKING A "HARD" INQUIRY ON YOUR CREDIT REPORT EVERY TWO MONTHS, TELL THE CREDIT REPORTING AGENCY THE SPECIFICS AND MAYBE THEY CAN CLUE THEM IN ON THE RULES ABOUT "POISONING" YOUR CREDIT REPORT. ALSO ASK THEM TO REMOVE ALL INQUIRES THAT NOW EXIST FROM THE COLLECTION AGENCY.
IF IT IS DONE TO A LOT OF PEOPLE THE CREDIT REPORTING AGENCY POSSIBLY WILL NO LONGER ACCEPT ANY REPORTING FROM THAT COLLECTION AGENCY.
RE: Another Message for Anthon
In answer to your question, a collection agent could make inquires after SOL and reporting limits. It’s called “poisoning” an account . . .
I found your answer to 777's question both timely and interesting as I am also experiencing a creditor "poisoning" my account. I had downloaded some sample letters and was contemplating sending them when I stumbled on this message board. My concern is applying for a mortgage. My credit now is great. My only problem is this one inquiry.
You warned 777 that contacting the agent directly could reset the statute of limitations. However, you suggested 777 have an attorney draft a demand letter.
My question to you is -- if you get an attorney to draft a letter, can that also reset the statute of limitations?
ALSO you mentioned that these intimidation tactics often end up with heat for the agency. How can you get these agents in trouble for their sleazy tactics?
Thanks for your help.
Mo has touch on one aspect of liability, heat (effuss, trouble, hassles) that collectors are better off not contending. Look at it this way… Running multiple inquires within a six month span is, in my opinion, abusive and can serve only one purpose; to cause an inquiry to stimulate a negative response against the consumer (in context with this thread topic). Yeah, I know I’m going to get tons of hate mail from collectors about this, but the truth is what it is.
The reason I suggested that 777 have a lawyer draft the demand letter is simple. I don’t know if 777 is able to compose a letter without having it construed by the collector as a reset. Now I’m not suggesting that 777 is stupid nor unsophisticated, not at all. It’s just that if an agency (or collector) is reckless enough to pull a stunt like poisoning a credit report, then they may be daring enough to try and pull a fast one by claiming some statement in the letter asserted a right to reset.
If one utilizes the services of competent counsel, like one specializing in consumer matters, then the reset issue is practically nonexistent. Also this will, for lack of a better expression, put the fear of God into the collector that the consumer is not likely to lay down for nonsense. An attorney letter always commands more respect from collectors, than mere consumer letters (sad but very true).
Keep The Faith,
Your Not That Far Off
You’ve touched on an aspect I was referring to when I mentioned collector liability. After all the term “poisoning” in collector-speak denotes a need for an antidote, like a response from the debtor. Which is a long way of saying your contention regarding a demand is certainly realistic, a viable option a consumer could certainly consider. Yes it could be that cut and dry, depending on the mentality of the target collector(s).
The trouble with a consumer contacting some collectors in a similar situation are two-fold; 1) either the collectors are stupid (and many are just that) as to the liabilities, and 2) they may tend to call a bluff. But having stated that, if a consumer were to compose a demand letter such as you’ve suggested. This could work to test the waters and in essence, give the collector(s) enough rope to hang themselves.
As far as an issue like this getting to trial, it simply shouldn’t. Once an action were filed or seriously threatened (in context with your contention) the agency lawyer would likely propose a settlement, as this would be far more cost-effective (considering the probability of loss). Of course other factors would have to be considered, but if the debt is under $5,000 then it makes little sense to do otherwise than settle.
My personal feeling is against a consumer contacting the collector who engages the poisoning method, because the tactic itself identifies sleaze. That is unless the consumer is savvy enough to understand the concept of reaffirmation, and the potential for such collector(s) using it against them. Still if a written demand (as you’ve suggested) were made from the consumer without mentioning anything about payment, whatsoever, then my concerns are perhaps unjustified.
Keep The Faith,