There were two comments I read on this board in the last week that did not seem quite right. I was wondering if they were correct or just one of those things that "everyone knows". First: A creditor cannot send your defaulted loan to a collection agency until 6 months after you default. If true, what would happen if they did? Second: A collection agency must send you a letter telling you that they are going to file negative information in your credit report before they actually do so and give you 30 days to respond. If this is true, is there anyway to use it to get the info off your report? I know I never got any notice. But, couldn't they just manufacture a letter now and back date it? How would you go about proving they did not send you a letter? Can you demand a copy of it? Any comments are appreciated.
To the best of my knowledge, neither one of these is true. Any time you are delinquent, they have the right to send notification to the cra, and I believe it is usually done automatically with 30,60, etc... day lates. I think they can turn an account over to collection any time that they believe that they won't receive payment, but I think they generally wait 6-8 months.
Those are false. (1) A creditor can turn your account over the day you miss your first payment. At that point, you have violated your credit agreement. Most wait at least 90-180 days and attempt to collect in-house first. (2) Usually by the time a CA as sent you a dunning letter, they are already smearing your credit report. When you get the dunning letter from the CA, you have 30 days to dispute the debt. Once notified of your dispute, they have to halt collection efforts until they provide the "proof" that you owe it.
