Jump to content

What does it mean when a collector has been "assigned" a debt?


confuseddebtor
 Share

Recommended Posts

Does this mean they actually own the debt? I received a letter from the original creditor stating my account was bought, transferred, and sold to a collector, but when I receive mail from the collector, it always says "assigned".

BTW, the letter I received from the original creditor was computer generated and did not have a date.

Link to comment
Share on other sites

Another term intended to confuse the situation...

In the context of what you just wrote, the JDB (Junk Debt Buyer) has been "assigned all legal rights regarding the debt". This normally includes the right to collect in full, charge interest, and take whatever legal action. But, they cannot legally reset the "reporting period" for the debt on your credit reports.

The confusion comes from the fact that CA's are often "assigned" to collect the debt for an OC. In that context, the CA has been hired by the OC, but does not have any legal rights.

Note that in your case, you're now dealing with a JDB...but...there may be a CA "assigned" to collect the debt by the JDB.

Link to comment
Share on other sites

Another term intended to confuse the situation...

In the context of what you just wrote, the JDB (Junk Debt Buyer) has been "assigned all legal rights regarding the debt". This normally includes the right to collect in full, charge interest, and take whatever legal action. But, they cannot legally reset the "reporting period" for the debt on your credit reports.

The confusion comes from the fact that CA's are often "assigned" to collect the debt for an OC. In that context, the CA has been hired by the OC, but does not have any legal rights.

Note that in your case, you're now dealing with a JDB...but...there may be a CA "assigned" to collect the debt by the JDB.

How can I tell for sure, if the JDB has full legal rights, or has been hired by the original creditor? If they were ONLY hired, does that mean the settlement agreement they've offered me, could later be refused by the original creditor, and considered null and void? This was a loan provided to me by a financial group, that works with a very large bank.

Also, your last sentence really confused me. You stated: "Note that in your case, you're now dealing with a JDB...but...there may be a CA "assigned" to collect the debt by the JDB". I thought a JDB was the same as a CA? Is CA short for collection agency? I'm confused.

Link to comment
Share on other sites

If you have a letter from the OC saying it was sold...and its listed on your CRs a "written off/sold to another lender", then it was sold. To figure out what right the JDBs has been "assigned", you need a copy of the terms and conditions for the original debt. The JDB can't assume more rights than were affored by the original contract.

And yes, it sometimes hard to keep the players sorted out.

OC = Original creditor, CA = collection agency, JDB = junk debt buyer. Some CA also buy junk debts. For that matter, some OCs also buy junk debts. Some JDBs hire CA to collect for them. It is important to try to keep it straight so you'll know who you're dealing with...and what they are legally entitled to do.

Once an OC has "written off/sold to another lender" then they have taken a loss against income on their income tax (got a tax break) and charged the JDB pennies on the dollar for the right to hassle you. Is that fair? Nope, but its probably legal. Either or both may contract with CAs to hassle you. You may indeed have owed the OC some amount of money in the past, but you don't owe them any more. The IRS has compensated them for their loss. If you're now dealing with a JDB, you need to decide how "obligated" you are to reward them for giving the OC maybe 6-7% of what you owed just so they can badger you into coughing up money.

Link to comment
Share on other sites

If you have a letter from the OC saying it was sold...and its listed on your CRs a "written off/sold to another lender", then it was sold. To figure out what right the JDBs has been "assigned", you need a copy of the terms and conditions for the original debt. The JDB can't assume more rights than were affored by the original contract.

And yes, it sometimes hard to keep the players sorted out.

OC = Original creditor, CA = collection agency, JDB = junk debt buyer. Some CA also buy junk debts. For that matter, some OCs also buy junk debts. Some JDBs hire CA to collect for them. It is important to try to keep it straight so you'll know who you're dealing with...and what they are legally entitled to do.

Once an OC has "written off/sold to another lender" then they have taken a loss against income on their income tax (got a tax break) and charged the JDB pennies on the dollar for the right to hassle you. Is that fair? Nope, but its probably legal. Either or both may contract with CAs to hassle you. You may indeed have owed the OC some amount of money in the past, but you don't owe them any more. The IRS has compensated them for their loss. If you're now dealing with a JDB, you need to decide how "obligated" you are to reward them for giving the OC maybe 6-7% of what you owed just so they can badger you into coughing up money.

Ahhh! Ok, I understand now. The collection office(or is it JDB) I'm dealing with claim they don't consider themselves a "traditional collection office", but prefer the term "Debt Resolution Experts". I checked with the BBB and surprisingly, they had very few complaints. Unusual for their field.

Anyway, they have not been rude, or bugged me via phone. In fact, the collector I've had contact with, actually spoke with me almost an hour explaining the different collection laws, and why the majority of collection offices have given the good one's who are willing to work with debtors, a bad name.

She then referred me to reputable "government" websites to double check the information she told me(irs, ftc, ect), and mailed me some info as well. Of course it was explained to me, that since I have no assets or anything of value, and I'm unemployed for medical reasons, it's in their best interest to "work with me", rather than go to court.

Although I know they've paid much less for the debt, I also realize that with six years left on the SOL for this debt, someone could still eventually take me to court to obtain a judgement for a much higher amount. So I'm truly hoping this agreement is legitimate, even if they're getting paid more than what they purchased it for. I swear, when I get out of this mess, I'm done with credit. Why can't I win the lottery????? *smiling* Second thought, creditors would probably find reasons to tack on more fees for sure if I won the lottery. LOL

Link to comment
Share on other sites

And they can always sell the remainder of the debt, they so nicely allowed you not to pay to another JDB.

So, if you do decide to pay them make sure the agreement includes, they will not sell the balance owed. Which will probably trigger a 1099-MISC if the balance is 600 or more, and you'll have to file that with your income tax return.

Link to comment
Share on other sites

The collection office(or is it JDB) I'm dealing with claim they don't consider themselves a "traditional collection office", but prefer the term "Debt Resolution Experts".

There are all kinds of players in the debt collection world. In additon to the kind that we're most familiar with...the "send me money NOW or I'll TAKE YOUR HOUSE AND FAMILY"...there are "you can catch more flies with honey" types like you seem to be dealing with...and the kind I call "debt fixers" that claim to be able to "settle" your debts for 40-60%. They're all collection agencies and subject to the same laws. Its just that some of them make you feel like they're doing you a favor by taking your money.

Link to comment
Share on other sites

There are all kinds of players in the debt collection world. In additon to the kind that we're most familiar with...the "send me money NOW or I'll TAKE YOUR HOUSE AND FAMILY"...there are "you can catch more flies with honey" types like you seem to be dealing with...and the kind I call "debt fixers" that claim to be able to "settle" your debts for 40-60%. They're all collection agencies and subject to the same laws. Its just that some of them make you feel like they're doing you a favor by taking your money.

Believe me...I know exactly what you mean. However, as mentioned in my previous message, this agency could have strung the debt along, and obtained a judgment for MUCH MUCH higher. I've had collectors do that. Afterall, when these companies sue, they don't usually drag one person into court. They often sue groups of people at once, which makes it more efficient for them. I've heard many, many, people on the internet say most collectors won't do this and that. I learned the hard way, that these companies will often call your bluff. You really don't know for sure. When one CC company sued me, there were 84 other people there for the same thing.

I had one collector, take me to court for $500 to obtain a judgement knowing my financial situation, and I've had collectors refuse to settle on a debt that's $2000. So paying $7300 instead of $20,000 or more in the future, without having to file bankruptcy(which stays on the report 10 years), or turn this into a judgement(which stays for 7), is a pretty good deal in my book. If the JDB benefits, and presents it as if they're doing me a favor...oh well. It sucks but that's life.

Also, just keeping it real, this is a debt I've accrued, which I promised to pay. These are not just debts they've pulled out of mid-air. Again, YES it sucks that JBD's, CA's, ect profit from our misfortune, but that's the world we live in. I've seen people pay mortgages for 15 years, get sick, and lose their home to someone who pays the balance of $5000. The CONSUMER who buys that home for such a small amount, is probably someone struggling to make ends meet like many of us. They're not a collector, JDB, ect. Are they wrong? Are they right? Or are they just playing the game our legal system has set up?

The list of examples could go on and on. Life is a lot simpler for me, when I commit to honor my agreements as much as possible, without worrying about the morality of others(collectors ect), and things I can't change. The only way to stop collectors from benefitting in this manner, would be for those of us who complain on the internet, to join forces, and complain to the right people who can change the laws. That's how the credit card companies got the laws changed in their favor.

Otherwise, complaining about it is wasted energy, an excess stress I truly don't need at this point in my life. Again, if this agreement is binding and legitimate, it sounds very good to me. I guess it depends on the perception of the debtor, and what their overall objectives are. As long as we live in the United States, ran by laws with loop holes, someone will always benefit from the misfortune of others.

The only way to not get played, is to not play the game at all. Which means if you can't save for it, put it in layaway, or pay cash upfront...DON'T BUY IT. I'm done with credit. Unfortunately, that's not always possible, so millions have to play the game, and pray illness or misfortune doesn't happen. :)

Link to comment
Share on other sites

And they can always sell the remainder of the debt, they so nicely allowed you not to pay to another JDB.

So, if you do decide to pay them make sure the agreement includes, they will not sell the balance owed. Which will probably trigger a 1099-MISC if the balance is 600 or more, and you'll have to file that with your income tax return.

Hi MtNair, you are 100% correct. That was the first thing I asked them to include in the agreement letter. Supposedly, they don't sell their accounts as long as the debtor is paying on time. I was told that if ever I need to adjust the payment amount, or will be late making a payment, to call and let them know. God willing, I hope that never happens. When I receive my circuit breaker check, I will save that to insure I'll always have a few months of payment on hand just in case an emergency comes up. :)

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
 Share

×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.. For more information, please see our Privacy Policy and Terms of Use.