What would you do? My dilema with a slam dunk case...UPDATE

[almost_there]

Some of you may remember my fight against Federal Credit Corp. To refresh your memory and help you understand the history of this issue, here are 2 threads relating to the case....

http://debt-consolidation-credit-repair-service.com/phpBB2/viewtopic.php?t=9979&highlight=

http://debt-consolidation-credit-repair-service.com/phpBB2/viewtopic.php?t=9206

Now, here is where I need advice...my lawyer and I know that to sue FCC right now would be a slam dunk...for the following reason:

Filed claims against Federal Credit Corp. and one of their employees just recently...expecting a settlement offer of at least $2k. My lawyer expects a slam dunk because we're suing them for contacting me directly after my attorney had notified them to go through him, and that is all very clear in black and white. This case is a BIG mess involving several companies, including Sprint and Gulf State Credit, but we're starting with Federal Credit Corp. My attorney is still working on the rest.

It's all in balck and white, very clear, and easy money for me hands down.

I spoke to my attorney yesterday and asked him when he was planning to serve this on FCC. He said he was taking his time and still doing more digging on Sprint and Gulf State Credit's involvement in this debt. There is quite possibly some BIGGER issues here, more than just ordinary FDCPA violations. He suspects that Gulf State sold a PAID debt, meaning that FCC bought a PAID debt and basically that there is a more to this case....meaning more people to sue and more reasons to sue.

He asked me if I wanted to just stop the investigation, take the easy victory/settlement from FCC and get this over with (it has been going on since 2003 after all) and he asked me if I need the money now. Truth is, yes. I'm at the end of my pregnancy, I could be having my baby any day now, there are things we need yet for her. Our property taxes are due next month and my paychecks will be over with in less than a month. Meanwhile my husband is still laid off (though scheduled to return to work around May 15th). Our financial situation is going from bad to worse, my husband calls me the "money Houdini," because I can always get us out of financial pickles, but even I know that we're about to hit a brick wall without a quick shot of some cash, soon. I have more than enough reasons to take the easy money and wash my hands of this, and only one to pursue this case further...these people have been as dirty as dirty gets, there IS more dirt to be found on these people. Going back and reading the threads I referenced above, from the start of this thing, makes me see that very clearly. There have been CLEAR violations since Day 1! My dilema here is that I don't want them getting away with all that is going on, they are guilty of so much more than just contacting me after they knew about my attorney. Hell, the entire thing with FCC began when I DV'ed them and they started collection attempts during the 30 days. And it snowballed from there. I feel like if I settle now that people will be getting away with something dirty without being called out about it. It's like "ok, you did X, Y, and Z to me, but I only need you to admit to Z and pay me for Z, and we'll call it a day, forget about X and Y." I just don't know.

I need the money. Even after the 40% I have to pay my lawyer (which by the way, is that alot?) any money will help me right now. Things will improve when my hubby gets back to work, but we still have debt to pay off from all these months of unemployment. I thought after we cleaned our credit before, before we bought our house, that I would never allow myself to get into this type of financial bind again...back to the drawing board. I guess it helps to know that before when we ran up debts and totally screwed our credit, we were young, stupid, and irresponsible... and we simply did not know better. Now we do and our credit is still actually looking pretty good, a few dings, but nothing major that I can't handle. And it would be relatively easy to get back on track knowing what I know now that I never knew back then. Pay down balances, get a more workable budget in place...not that hard. It's just that having so little money right now is hard, especially with the baby coming and wanting to have everything a certain way. But as I told my husband the other night "all that really matters is me, him, and our baby and we best get used to not being perfect now or it will just haunt us forever because we're never going to be able to afford everything being perfect." It was an a-ha moment for me.

OK, I've strayed from my question...what would you do? Take the money or see how far this rabbit hole goes? I need to decide soon.

[Poorgirl]

First, let me say I'm sorry to read about your situation. I'm no expert at this since I have my own financial problems. However, from a person looking in on yours I would ask myself these questions:

1) Is continue on to pay an attorney money you barley even have worth the $2k your expecting.

2) By the time you get the $2k you might be in much further debt then when you started. The $2k settlement will end up just covering the bills you've collected trying to go after these people.

From the way you’re talking in your post it sounds like you need to take the money. Look if you were talking about a case that could be worth millions then I would say to you "PAY THAT ATTORNEY FEES" but your case seems to be costing you allot more then $2k. Don't let this drag on to long that lawyer and other bills will leave you broker.

I wish you good luck!

[almost_there]

Thanks, Poorgirl. Just to clarify, I am not paying the attorney anything right now, so he isn't taking money I don't have, he only gets paid 40% of whatever we might win. I'm not paying him out of pocket.

[Poorgirl]

Good lord! Did you say you or not paying him anything right now. I have two very big words for you WATCH OUT! One more thing I notice after a quick glance of your post. It appears to me your hoping that the Lawyer some how dig just deep enough and find more issues with these people and thus, creditors ended up owing you more money, Right!

This might not happen the creditors could drag this on for years. The only one who will come out richer is the lawyer.

[almost_there]

Did you read the history of this mess, poorgirl? Just curious. If you did, you'd see that it won't take much digging to find what we're looking for.

As for my attorney not charging me anything now, that's how it worked in the class action I was involved in last year and it worked out fine. I didn't pay them anything in the end they got it from the defendants.

[Poorgirl]

I hope things really do work out for you.

[Xanathos]

That's a personal decision you have to make for yourself (and no, 40% isn't a lot in the world of credit law since there are so few lawyers that do it. The true masters like Bob Sola, Lenny Bennett and Dave Szwack all take in the 45% neighborhood, if memory serves me right).

But I will say this: When I file suits for Chickie or help a friend do one, I get CA's to settle for 2 grand for doing little more than verifying a disputed debt--with absolutely no hassle whatsoever. They don't even think twice about it. And there are no fees anywhere to be found, as they're all pro se. The way you describe it makes it sound like there's a degree of actual damages and a multitude of violations between multiple companies.

If you want 2 grand for something with more teeth than your run of the mill "you verified a debt when all you have is a name, an address, a DOB and an amount allegedly owed, all on a computer screen...then take 2 grand. I wouldn't take 2 grand minus 40%. If it's as open and shut as you say it is, then have your lawyer state that they have to pay whatever his fees are/commission is on top of the settlement amount--they'd end up paying them in the end if it went to trial, regardless...

[almost_there]

(and no, 40% isn't a lot in the world of credit law since there are so few lawyers that do it. The true masters like Bob Sola, Lenny Bennett and Dave Szwack all take in the 45% neighborhood, if memory serves me right).

When this all started, you wouldn't believe the hard time I had trying to find someone who would even talk to me about this. I called several local attornies and they all sounded as though they had never even heard of FDCPA and FCRA. This is such a mess that I would have a very hard time untangling it all without the help of an attorney.

A couple more things I found after dusting off my file on this...Sprint sold the account again, in Sept. 2004, to another agency, First American Holdings. A letter dated 9/29/2004 stated the amount due as $695.39!!!! So not only is a PAID debt being sold and passed around like a drunken cheerleader at a frat party, but the amount due is increasingly higher with every collection attempt. (One thing my attorney is looking into is the interest issue.) I hadn't looked at my file in awhile, but I went over it now with a fine tooth comb, trying to decide what to do and I flagged a few things to mention to my attorney.

1) FCRA violations...this was reported to the bureaus, and I have old credit reports that show "date reported", during or shortly after I requested DV and didn't get it DV'ed. They were reporting an unvalidated debt. The date reported was 10/03, and DV green card was dated 9/3/03.

2)The initial contact from FCC was dated 10/1/03, it was the first collection attempt in writing, but they called my parents on 9/20 and again on 9/30...so they were clearly making 3 collection attempts during that 30 day period when they are not allowed to, while I was waiting for them to validate. In fact, NO attempts had even been made until I saw this on my report and requested validation.

3) I think we both overlooked the letter from First American Holdings, so I will bring that up, too. Sprint SOLD a PAID debt, a debt that's also SOL...and before that FCC had it, before that Gulf State Credit, and at one time it was Berks Credit and Collections...it's enough to make my head spin. I have documentation from Gulf State that the account has been paid in full, you'd think that is all I need to resolve this matter, but that has not been the case. Now Gulf State has told my attorney that there were 2 accounts, but they have not provided any proof to that claim. One thing that has held this up is people ignoring my attorney's requests for info. Maybe we have to get more aggressive My attorney said that I am the boss, maybe I should tell him to forget asking nicely and just take the f*#kers to court and make them prove it there, if they haven't proved it yet, betcha it's because they can't!

Come to think of it, the bottom line could come down to my orginal request for validation...they never have proved it. They've passed bucks and pointed fingers and added interest instead.

To me, all of this should be worth well more than 2k minus 40%...I'm going to call my attorney tomorrow, talk this over, mention the idea that we get his fees out of the defendants (it can't hurt, I haven't signed a retainer yet) and then see how things go.

[almost_there]

Had a nice long talk with my attorney this morning...here's what we came up with. I decided to wait on the Federal Credit Corp. case. My attorney explained everything much more cleary to me, I asked alot of questions and having just re-read my entire file about this last night I was fresh on all of the issues involved. Anyway, here is why I am waiting...the interest on this alledged debt is huge, it's more than the original balance due, making a $290 debt now nearly $700. My attorney has dug and dug for evidence that they either can or can not collect that interest, but has come up empty handed. Attempts to contact the original creditor have turned up nothing either. He tried asking Sprint about the original terms of this account, so far hasn't gotten a response. But as my attorney explained to me, and why I decided to wait, is that we can still ammend our complaint and turn it into a class action if we can find evidence that either 1) they are not allowed to collect interest OR 2) that they are collecting more than they allowed to. And if one of these is true, we could go for ACTUAL DAMAGES in a class action and they would have to pay back all that interest they were not entitled to. In my opinion, this could benefit alot more people this way (yeah I know, mostly my attorney) but still that would be more than the slap on the wrist our current complaint would give them.

I told my attorney to hold off serving the complaint, see what or if we hear back from Sprint and that I would also look for the answer to the interest question...see if I can't find anything to help. If we don't hear anything or get the answer we need, I can go with the slam dunk. As desperate as I am for money, I can still afford a little bit more time...after all I am the "money Houdini" I have been in much worse situations, I will be ok as long as I know in the end there is money on the horizon.

The question of suing Gulf State Credit also came up, still working on that one, too. As for suing Sprint, my attorney thought that would be barking up the wrong tree, chances are he said that they sold this debt once, and from there it was out of their hands. Even though the collection letters say "Sold by Sprint" that doesn't mean it wasn't another collector that really sold it to them....

For all of this crazy mess, it is SAD that there isn't alot more that can be done. Turns out the biggest issue might turn out to be the interest when so, SO much more has taken place here. And as my attorney told me the other day, if I don't accept the settlement they offer me, I could end up S-O-L if it goes to court, the judge could throw it out if I don't accept what they offer. I guess we'll see what happens.

Anyone with any experience on this interest issue, PLEASE share! Thanks everyone for your help on this.

[almost_there]

Anyway, here is why I am waiting...the interest on this alledged debt is huge, it's more than the original balance due, making a $290 debt now nearly $700. My attorney has dug and dug for evidence that they either can or can not collect that interest, but has come up empty handed. Attempts to contact the original creditor have turned up nothing either. He tried asking Sprint about the original terms of this account, so far hasn't gotten a response. But as my attorney explained to me, and why I decided to wait, is that we can still ammend our complaint and turn it into a class action if we can find evidence that either 1) they are not allowed to collect interest OR 2) that they are collecting more than they allowed to. And if one of these is true, we could go for ACTUAL DAMAGES in a class action and they would have to pay back all that interest they were not entitled to. In my opinion, this could benefit alot more people this way (yeah I know, mostly my attorney) but still that would be more than the slap on the wrist our current complaint would give them.

No word yet from Sprint, but guess what I found today!!! I was working on cleaning off my desk, moving papers around my den, etc. and I kept thinking to myself..."I must have something around here with the original terms of the account" With all of the paperwork I have saved from ALL KINDS of old accounts, I figured I surely had to have something with the terms on it for Sprint. It was then that I decided to look on the back of my old phone bills and I just couldn't believe it! There on the back of those phone bills was the terms and conditions of the account! Eureka!

I read it real quick and looked over nearly a years worth of bills, they all said the same thing and NOT ONE WORD about interest being collected on past due balances. In fact, there was really no mention of any collection terms, only if you gave them a check returned unpaid by your bank, which is not applicable here.

I wasn't sure if this is what we needed for a class action or not, but I called my attorney and he sounded confident it is. Man, I couldn't believe it! It was right under our noses all along! I am going to fax him the backs of bills he's already seen the front of and I imagine that this is the ammo we need to file suits against Federal Credit Corp, Gulf State Credit, and the latest CA who has this account for attempting to collect interest on an account that didn't allow for it. The Dept. of Commerce here in Minnesota told me that fees are allowed, but interest is only allowed to be collected by agencies if the original contract said so. The collection letters I have say VERY CLEARLY "Original Balance" and "INTEREST" nothing whatsoever about fees. In Gulf State Credit's case, they're the ones that got paid for the debt, with interest, so I imagine we'll pursue something against them as well.

I'm glad it's turning out this way...and oh so glad I turned over those bills and found out what was on the back!

[admin]

In some states, though, there is an interest that can be charged if not specified in the contract. You need to look it up.

Sorry.

[almost_there]

In some states, though, there is an interest that can be charged if not specified in the contract. You need to look it up.

Sorry.

Any ideas where I might be able to look that up? I want to be sure. I'm pretty clear that the Dept. of Commerce, specifically the man that licenses and over sees collection agencies in MN told me it's not allowed unless stated in the original terms, but if there is somewhere else I should look I will. (I should talk my lawyer down on his fees for all of the work I am doing on this myself!)

[admin]

Here's a link to all state statutes:

http://www.law.cornell.edu/topics/state_statutes.html

[Methuss]

Take the money now. Gulf-State and the others are not precluded from their own liability just because you nail a few FDCPA violations down on their collector.

The FDCPA has only one purpose...to regulate the beahvior of collectors. Who owes what is totally immaterial. If the OCs perpetrated defamation against you that is a seperate issue in its entirety.

One thing has me kind of concerned though. FDCPA cases must be filed within 12 months of the offense. This is looking like the lawyer sat on it too long.

[ghacorp]

My honest impression is your lawyer is a dirtbag who doesn't really know the law. FDCPA guidelines allow some slippage to account for delays and common errors. Forty percent is the going contingency rate, however the more digging, the more expenses generated and guess who stands to win the most?

[almost_there]

One thing has me kind of concerned though. FDCPA cases must be filed within 12 months of the offense. This is looking like the lawyer sat on it too long.

The case was filed within the allowed amount of time, it was only last year that the offenses we're suing for (contacting me after attorney involved) took place. The complaint just wasn't served yet because we were waiting to see if there was evidence to support a class action/ammend the complaint.

[almost_there]

Forty percent is the going contingency rate, however the more digging, the more expenses generated and guess who stands to win the most?

I know that. I just thought I am doing the right thing helping to nail these guys.