I had a debt that was charged off by a bank and given, or sold, to First Select. They sent a few invoices for payment, almost as if I had a new credit card from someone I never heard of. Then, I got several invoices saying that I owed them a few thousand dollars, and they would be willing to settle for about 70%. They also called repeatedly, but I never talked to them. Now, I got the final demand letter to settle for about 70%. Almost simultaneously, I got a demand letter from a local attorney, stating that I owed the full amount and that I might be sued if I did not pay up. I am wondering if I should now call Discover, the original creditor, and try to arrange something (even the amount that First Select says they will settle for is considerably above the credit line I was given, due to late fees, over the limit fees, and absurd interest, etc. Or, should I call First Select and try to negotiate something (although I can't pay at the moment, I might be able to pay them 50% in a month or so), or should I send validation letters to First Select, the lawyer, or both? (It has been several months since I got the first notice from First Select, but only a few days since I got the letter from the lawyer. If I send the validation letter, my understanding is that they have to put a notation on the credit report that the debt is being disputed. Is this correct. If they do not do that, am I entitled to $1000 if I sue them? If they don't validate the debt in 30 days, aren't I also entitled to an additional $1000, and, don't they then have to remove the whole matter. I notice that there are a bunch of validation letters to be sent after the 30 day period, but if they have to remove it if they don't respond in 30 days, why give them additional time? If I was to sue, what are the chances of winning? How likely are they to validate the debt within 30 days? What constitutes true validation?
nanook, are you really a new member? The reason I ask is that your questions really demonstrate a tremendous bank of knowledge, as if you've been hanging out here for years. Most so-called "newbies" don't even know what a validation letter is, much less how to how to walk through the maze of procedures and other legal matters. Plus, a true newcomer wouldn't even begin to know the reasons behind asking a question like, "What constitutes true validation?" So fill us in! That said, welcome to CreditNet. I'll read your question more closely later tonight when I have more time to compose an answer. Doc
Well, I've been lurking and reading a lot since joining recently. As far as an answer to some of the other questions are concerned, lets just say I know my way around the legal system and lawsuits, although I am not a lawyer. I guess you could say that I have been something of a consumer advocate over the years.
If you send a validation letter, they will have to stop collection activity until they validate. They still would be able to sue you, however. They are under no obligation to validate within 30 days, and you can't win a lawsuit bropught solely on the grounds that they didn't provide the information you asked for. It is also doubtful (but its not a definte no) that you could sue for failure to advise the CRAs that you are disputing the debt. Squawk1200 (posting again now that bbauer has been suspended)
This is taken from the FDCPA website under staff opinion letters. II. "Is it permissible under the FDCPA for a debt collector to report, or continue to report, a consumer's charged-off debt to a consumer reporting agency after the debt collector has received, but not responded to, a consumer's written dispute during the 30-day validation period detailed in § 1692g?" As you know, Section 1692g(b) requires the debt collector to cease collection of the debt at issue if a written dispute is received within the 30-day validation period until verification is obtained. Because we believe that reporting a charged-off debt to a consumer reporting agency, particularly at this stage of the collection process, constitutes "collection activity" on the part of the collector, our answer to your question is No. Although the FDCPA is unclear on this point, we believe the reality is that debt collectors use the reporting mechanism as a tool to persuade consumers to pay, just like dunning letters and telephone calls. Of course, if a dispute is received after a debt has been reported to a consumer reporting agency, the debt collector is obligated by Section 1692e(8) to inform the consumer reporting agency of the dispute.
The question presupposes that it's already on the CRA reports before the validation request. If it isn't, then I agree that placing it on there is "collection activity" prohibited until validation. If it is already on the report, I agree that the FCRA may be interpreted to require that they report the dispute (see 15 USC 1681t(a)(2)). The question is whethere you could win a lawsuit against the CA for not doing so. Inasmuch as the FCRA pretty much bars private lawsuits against those who report information (see 15 USC 1681t(a),(d)), I seriously doubt a lawsuit on this basis would survive a motion to dismiss, much less win.
Well, hell, you could also throw in allegations of civil RICO violations and allege that the company is merely a front for Al Queda, to boot. And sure, they might settle right away. But people need to know what these types of suits actually are -- bluffs. In other words, it's as if you're at the poker table and all you've got is a pair of 2's. If you bet big, you aren't hoping to get called and you sure as hell don't want to get raised. And if you do get raised, you pretty much are gonna throw 'em away. You can't stay all the way to the showdown and say "Full house? So what, look at these babies!" and expect to be taken seriously.
I am working on this guy's credit that has a First Select issue. he received a letter on 10/31/01 of this year from a legal office here in Atlanta, stating that he needs to provide his legal answer (job, address, pay, etc.) . Are they kidding? Yet, we have asked for validation...First Select is getting a kick out of this. Who was the OC (original creditor)? They suck!
