What Do I Do Now?

[johnransom]

I sent out four DV letters to CAs and disputed the accounts with the three major CRAs. I got back one inadequate response from a CA within the time limit as discussed a few threads ago, but nothing from the other three. Of the CRAs, Equifax said they couldn't find any of the accounts, although they listed all as being with the OCs, Experian verified all four accounts with the OCs, and Trans Union sent me a weird letter taking about identity theft.

What should I do at this point? And if it's the OCs reporting to the CRAs, how am I supposed to get the accounts cleaned up?

[Ravenous Wolf]

I am not really sure what your question is.

DV is only for collectors. Creditors and any OC is not covered by the FDCPA.

If a CA is trying to collect from you but it doesn’t show up on your credit report, then you can still do DV but that has nothing to do with getting an OC to remove a negative credit item.

If an OC is reporting you, then you have to use the credit repair techniques detailed on this board.

[johnransom]

I suppose I really had several questions.

First, if an account has been sent to a CA, why is it still appearing on my CRA as being with the OC? (NOTE: it is possible that the reports came back too soon to have the CAs on them, as I DVed them as soon as O got the notices from the CAs)

Second, if this is a common practice, what use is DV at all, other than to get the CA off my back?

Third, if this is not normal, is it some sort of violation for a CA to report a debt as being with the OC?

Fourth, have the two CRAs who supposedly checked it out failed to perform proper verification of the account?

Fifth, what do I do with Trans Union, who have not responded at all to the verification request?

[willingtocope]

I can help with a couple of those questions, I think..

1. Sometimes, OCs "contract" with CAs to handle their collections. Usually, this is just at the beginning of the process, but may go on for some time. The OC still owns and controls the debt, but the CA does the dirty work and gets paid a commission on what they're able to collect. You can use the FDCPA processes against these guys, and if they can't validate they'll probably send it back to the OC who'll get someone else to try.

2. Yep...standard practice. DV gets the CA off your back and buys you some time...unless of course they do validate in which case you might wind up in court.

3. Its normal. Its not the CA reporting the debt to the CRA...its the OC. They still own it.

4 & 5. It came back verified because its still with the OC. TU is just slow.

[johnransom]

Thanks, WTC.

From what you are telling me, it sounds like my best option at this point is to negotiate terms. I say that because my accounts are all only 7-8 months past due and maybe half have been sent to CAs, and my primary goal, other than getting rid of the debt of course, is to return my credit report to a healthy condition (which would allow me to get a better job and thereby pay the debt faster). Since it seems likely that the OCs are all still controlling the debt, it may be too early for validation to work fully, but they probably would be ready at this point to accept a fairly deep discount, right?

In which case - what kind of discount should I offer? I was thinking if I offer 50% of the principal (excluding interest, late fees, etc.), I should expect counteroffers at around 75-80%, which is where I would be comfortable paying. What do you think?

[willingtocope]

That sounds like a plan.

You should probably send the OC a CMRRR with saying "gee, sorry, fell on rough times, but I'd like to settle, here's my offer". You may have to talk with them on the phone, and you may get some grief from some of the OC's about it being out of their hands, but keep asking to talk to someone further up the food chain. You need to find someone with the authority to make a settlement.

But...whatever you do, make sure you get it in writing (don't send any money until you have proof) and you should also ask for the TL on your CR to read "Paid as agreed".

The thing to keep in mind is that a paid collection is just as bad a hit on your CR as an unpaid...so if they won't clean up your trade line, you might as well save your money.

[johnransom]

Uh-huh. I've already drafted the letter and it includes all of that. Thanks.