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OC says PFD is illegal? Sick and tired...


insomniac
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Small credit-union charge-off from a few years ago (within SOL), went to collections briefly but was recalled by the OC after I refused to talk to the CA (which actually validated properly!). It's been a sleeping dog that I've let lie for a while, and it's for an absurdly small amount of money (a little over $200), so I want it gone. Only reporting to TU.

Sent a PFD letter (full amount) to OC in November, they replied saying "pay us that amount plus interest, we will update the tradeline." My response: "What does 'update' mean? I asked for deletion, please clarify." Now they say PFD is illegal and cite FACTA. I know better, but I'm dealing with a "collection manager" who may actually believe this. *sigh* I also know there's really no point in paying them if they won't delete or give me something other than "paid charge-off."

I just want to be done with this, but I also don't want to get sued; a quick check of court records shows that they have actually sued people in their home county for amounts of only a couple hundred dollars and have won, sticking the defendant with the court costs/attorney fees. The amount of interest only comes to another $60, so I have no problem meeting their demand if they'll meet mine.

Here's my next letter. How does this sound?

I am in receipt of your letter dated XXXXXXXXX. You have stated, “The Fair and Accurate Credit Transaction Act specifically states that false reports knowingly made are punishable by law. I am positive that you would never ask of or imply that you would wish the credit union to engage in illegal activities.” You are correct; I have not, nor will I, ask the credit union to perform an illegal act.

I have read the text of and am familiar with the Fair and Accurate Credit Transactions Act (FACTA), which is in fact a 2003 amendment to the Fair Credit Reporting Act (FCRA). Nowhere in this law is it stated that deleting an account from the records of a credit bureau is fraudulent or illegal. The FCRA simply states that if an account is reported, it must be reported accurately (sec. 623, “Responsibilities of furnishers of information to consumer reporting agencies,” 15 USC sec. 1681s-2). Creditors delete accounts from credit reports every day. Furthermore, though I have not asked the credit union to perform an illegal act, it appears that XXXXXXX is currently reporting an incorrect balance to TransUnion, thus violating the FCRA.

I am negotiating in good faith, and as I have stated previously, I am willing to pay the amount of the XXXXXXX charges plus interest. My previous letter sought clarification of two items: the account status that will be listed with the credit bureaus upon payment, and whether an agent of XXXXXXX will provide a statement in writing confirming that the debt has been paid and no further collection action will be taken. You have not provided clarification of either item.

Allow me to state this as clearly as possible: If this account will not be deleted or updated to a positive or neutral status with the credit bureaus, there is little incentive for me to remit payment. This is not a refusal to pay, but a “paid charge-off” listing is not acceptable to me. If XXXXXXX refuses to delete the account upon receipt of payment, which I have requested and have stated is perfectly legal, I will also accept a status of “paid as agreed” or simply “paid” with no “collection” or “charge-off” notations.

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Read it again, calm down, re-read it, calm yourself again.

I'd suggest you soften your tone. Your exasperation is leaking from between the lines. Calm down again...j/k

Be sure to mention that they do not have to perform illegal or contractually forbidden activity. They can simply neglect to verify this PAID OFF collection in response to a future dispute, since reporting is a business expense and unnecessary after PIF. If they agree to stop reporting, then nothing illegal has happened, the account is PIF and they incur no further costs for this resolved issue.

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I though this was well written up until the very last line. You do say it's within SOL, so that is a factor to consider. Basically, you pay and get nothing and it continues for another 5 years??

Yeah, my last paragraph is what I'm least sure of. I don't think the woman from the credit union understands that I have no reason to pay them if I can't negotiate the reporting status. I wanted to make that clear, but perhaps I'm being too confrontational. I'm trying to be polite but firm in making my point: a TL listing "paid collection" or "paid charge-off" means they don't get their money.

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Read it again, calm down, re-read it, calm yourself again.

I'd suggest you soften your tone. Your exasperation is leaking from between the lines. Calm down again...j/k

Be sure to mention that they do not have to perform illegal or contractually forbidden activity. They can simply neglect to verify this PAID OFF collection in response to a future dispute, since reporting is a business expense and unnecessary after PIF. If they agree to stop reporting, then nothing illegal has happened, the account is PIF and they incur no further costs for this resolved issue.

I re-read it several times before posting and I'm no calmer! :evil: But I'm certainly calmer than I was when I opened the mail yesterday, and I waited several hours before drafting a response. I just resent the implication that I'm asking them to do something illegal. I also thought this would be open-and-shut: I agree to PAY IN FULL, they delete, end of story.

I'll make some changes and re-post later.

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re: Illegal.

I'm about to sue a CA for telling me that PFD is fraud....

http://debt-consolidation-credit-repair-service.com/forums/showthread.php?t=276880&highlight=removing+collection+fraud

Good luck - keep us posted

Yeah, I've been keeping up with your thread. The big difference here is that I'm working with an OC rather than a CA, so I can't claim misleading statements as FDCPA violations because it doesn't apply, as far as I understand. Either way, I hope to get this done in the next month or two.

Thanks.

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Now they say PFD is illegal and cite FACTA.

What exactly are they citing? Did they list a paragraph/article or otherwise include any verbage to back up their claim?

I'm in your corner, but not in your boat, so I'm interested in seeing what comes of this.

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What exactly are they citing? Did they list a paragraph/article or otherwise include any verbage to back up their claim?

Nope. Their "citation" of FACTA is quoted directly in the first paragraph of my letter. It's just them basically saying "FACTA says we have to report accurately or else we're breaking the law." Maybe they're genuinely clueless, or maybe they're just trying to play some hardball (poorly). I'm not giving in.

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They're hoping you blink first. It's probably their best stall tactic at the moment. They already know they stand to gain nothing if you decide to let it run its course. Stand your ground. Don't pay anything unless it's on your terms, just like you have already stated to them. Be persistent; you might be surprised when they eventually agree!

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I don't think the woman from the credit union understands that I have no reason to pay them if I can't negotiate the reporting status.

New here, but thought I might chime in. Perhaps they think your "incentive" to pay them is that they won't sue you as you say they have sued others for similar amounts.

...but I also don't want to get sued; a quick check of court records shows that they have actually sued people in their home county for amounts of only a couple hundred dollars and have won, sticking the defendant with the court costs/attorney fees.

It would seem that the person you are dealing with believes what they are saying (violating the law) as it costs them nothing to do as you ask. If they do what you ask they get paid, so something is preventing them from acting on your request.

Perhaps the person you are dealing with is a idiot? Good luck either way.

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I pestered one CA so much that after I send them a letter about third party disclosure as they left a message with the "if your not merkurfan hang up now" she didn't hang up and heard it so I suggested they consider a fifth attempt to do a PFD. they just deleted! I didn't even have to pay them :) presistance pays off, stick with it.

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New here, but thought I might chime in. Perhaps they think your "incentive" to pay them is that they won't sue you as you say they have sued others for similar amounts.

Technically speaking, yes, that would be an incentive, but I consider it to be a small one because of other factors. The other judgments for small dollar amounts appear to be default judgments brought on people who didn't show up for court; I'm smarter than that. Those defendants may also be people who have overdrafted checking accounts without resolving them, rather than delinquent credit card debtors. (Small difference, but maybe the credit union takes people who mishandle checking accounts more seriously.) The great majority of judgments they have won are for several thousand dollars, presumably from foreclosures and repossessions. Lastly, I don't live in the credit union's charter area anymore, so if they want to take me to court, they'll have to put some more effort into it. If they really wanted to sue me for a couple hundred bucks, I'd think they'd have come after me years ago.

It would seem that the person you are dealing with believes what they are saying (violating the law) as it costs them nothing to do as you ask. If they do what you ask they get paid, so something is preventing them from acting on your request.

Perhaps the person you are dealing with is a idiot? Good luck either way.

Yeah, the whole thing blows my mind. I'm offering to pay them in full in return for a relatively small act on their part, but they don't feel like it. Maybe my money is not good enough for them. ;) More realistically, this is a small operation, and it's entirely possible that this collection manager has never run across someone like me who is informed and attempting to negotiate.

Should I go over her head if I don't make progress on my next letter? I was hoping to get this resolved through normal channels, but I do happen to personally know the chairperson of the credit union's board of directors.

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All right, draft #2. Slightly less contentious, slightly more detailed with regard to options they have.

I am in receipt of your letter dated XXXXXXXX. You have stated, “The Fair and Accurate Credit Transaction Act specifically states that false reports knowingly made are punishable by law. I am positive that you would never ask of or imply that you would wish the credit union to engage in illegal activities.” You are correct; I have not, nor will I, ask the credit union to perform an illegal act.

I have read the text of and am familiar with the Fair and Accurate Credit Transactions Act (FACTA), which is in fact a 2003 amendment to the Fair Credit Reporting Act (FCRA). Nowhere in this law is it stated that deleting an account from the records of a credit bureau is fraudulent or illegal. The FCRA simply states that if an account is reported, it must be reported accurately (sec. 623, “Responsibilities of furnishers of information to consumer reporting agencies,” 15 USC sec. 1681s-2). Creditors legally delete accounts from credit reports every day, and such behavior is documented in federal case law. Furthermore, though I have not asked the credit union to perform an illegal act, it appears that XXXXXXXX is currently reporting an incorrect balance to TransUnion, thus violating the FCRA.

I am willing to pay the amount of the XXXXXXXX charges plus interest. My previous letter sought clarification of two items: the account status that will be listed with the credit bureaus upon payment, and whether an agent of XXXXXXXX will provide a statement in writing confirming that the debt has been paid and no further collection action will be taken. These items have yet to be addressed.

Again, I am seeking deletion of this account from credit bureau records upon payment in full, which falls within legal boundaries of the FCRA. XXXXXXXX does not have to perform illegal or contractually forbidden activity. A status of “paid as agreed” or simply “paid” (with no “collection” or “charge-off” notations) also qualifies as correct reporting after payment. Lastly, the credit union has the option of not verifying the tradeline in response to a future dispute with the credit bureaus, which would cause a deletion through no action on the part of the credit union.

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insom,

I like your latest letter a lot! Nice "tone" to it. :twothumbsup: But after I got off the phone today with an old utility co that had agreed to a PFD (not in writing though, I know I'm a fool!), then after payment has refused to delete, I am not sure what the heck is going on anymore! The lady was nice and I do believe she would have deleted if she could but there seems to be something else going on. She insisted the CRA's have "...tightened up..." their "guidelines" with regard to doing deletions. She spent quite a bit of time w/me on the phone and seemed to be searching thru her options on her end, but to no avail. So, maybe we are both dealing with a pair imbeciles (a distinct possibility) or there are "new guidelines" with regard to creditors requesting deletions, I'm not sure. Perhaps someone wiser than I could provide some guidance...

::travolta::

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She insisted the CRA's have "...tightened up..." their "guidelines" with regard to doing deletions. She spent quite a bit of time w/me on the phone and seemed to be searching thru her options on her end, but to no avail. So, maybe we are both dealing with a pair imbeciles (a distinct possibility) or there are "new guidelines" with regard to creditors requesting deletions, I'm not sure. Perhaps someone wiser than I could provide some guidance...

I think "new guidelines" means "hiding behind FACTA/FCRA," which doesn't forbid PFD at all.

I'm convinced that someone higher-up who is actually a decision-maker within these companies would have no problem authorizing such a deletion. They get their money, I get a deletion, everybody wins. There's too much paranoia about litigation that would never come to pass. This is why I'm giving serious thought to writing the credit union's board of directors, as I personally know the chairperson.

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"...I do happen to personally know the chairperson of the credit union's board of directors..."

OMG, what are you waiting for? Speaking to this person directly about your trouble getting this cleared up may not just alleviate your problem, but also potentially impact their reporting policy. If it was me, I'd keep emphasizing the win-win in PFD. Actually, I had a client who had a similar situation (he worked for a hospital in a high-ranking position) who experienced excellent results by speaking with the hospital's Director of Finance.

I suggest adding a couple of sentences to your amended etter. From the second paragraph:

"...(FCRA). Nowhere...This statute, nor any other federal or state law, does not compel or require credit reporting at all. It's a voluntary activity that costs money. The FCRA simply states..."

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I think "new guidelines" means "hiding behind FACTA/FCRA," which doesn't forbid PFD at all.

I'm convinced that someone higher-up who is actually a decision-maker within these companies would have no problem authorizing such a deletion. They get their money, I get a deletion, everybody wins. There's too much paranoia about litigation that would never come to pass. This is why I'm giving serious thought to writing the credit union's board of directors, as I personally know the chairperson.

I'm with you insom, but I can't believe the person(s) we are talking to in both are cases could be THIS IDIOTIC!!! Just take the money and do the deed already! Are they sadistic?, madd with power? or truly worried about violating some law? Pretty good advice from Ahntara. Good Luck!!

Now wait till you hear MY problem with a CA and OC who refuse to validate...

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OMG, what are you waiting for? Speaking to this person directly about your trouble getting this cleared up may not just alleviate your problem, but also potentially impact their reporting policy. If it was me, I'd keep emphasizing the win-win in PFD.

Well, I'm not best friends with the chairperson, but my family has a relationship with hers (through living in the same small town). I was debating whether to send a letter to the credit union office in the chairperson's name and risk it getting intercepted by other staff, or directly to her home. All board members are volunteers and I suspect she does not visit the office regularly, but communication would be forwarded. I think I will send it to the credit union, addressed to her and marked "personal and confidential." I'm sure she doesn't get normally get involved in the business of individual accounts, and I didn't really want to "bother" her, but I suppose this would be a good reason to do so. :-) I intend for my letter to her to take on more of a "goodwill" tone, rather than one of negotiating, but I will make all the same points.

I suggest adding a couple of sentences to your amended etter. From the second paragraph:

"...(FCRA). Nowhere...This statute, nor any other federal or state law, does not compel or require credit reporting at all. It's a voluntary activity that costs money. The FCRA simply states..."

I was trying to figure out how to work that in there, and I like it. Thanks.

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Okay, draft to chairperson of credit union's board of directors. Do I send this at the same time as my other letter to the collection manager, or wait for a response to that one first?

I was a member of XXXXXXXX for many years. In 2000, I was issued a XXXXXXXX credit account. In January 2005, I defaulted on this account due to financial difficulties and mismanagement on my part. The account was placed with XXXXXXXX, Inc. for collection, and was charged off by XXXXXXXX as a bad debt in July 2005. I did not receive any communication from the collection agency or XXXXXXXX regarding this account after April 2005.

I have renewed efforts to resolve old debts and repair my credit history. In November 2007, I sent a settlement negotiation letter to XXXXXXXX's main office. In this letter, I offered to pay the outstanding balance in full in exchange for deletion of the account from the records of all credit bureaus. Ms. XXXXXXXX, collection manager, replied to my letter indicating that additional interest was due and that the account would be “updated” with the credit bureaus upon payment. I wrote Ms. XXXXXXXX agreeing to pay the additional interest, but I also requested clarification of her statement and reiterated my request for deletion of the account upon payment. Her subsequent response claims that the Fair and Accurate Credit Transactions Act makes it illegal for the credit union to do so. I maintain the legality of my request and have substantiated my claim. I also informed Ms. XXXXXXXX of options other than deletion that would both relieve XXXXXXXX of the duty and cost of reporting the account to the credit bureaus, and repair my credit history as desired. Copies of all communication to date between myself and Ms. XXXXXXXX are enclosed.

I would like to resolve this debt and curtail the negative impact of this account on my credit history, which has already been harmed for years. This is best accomplished through removal of the entire listing, or removal of the derogatory notations attached to the listing. I am interested in reaching an agreement that satisfies both parties, after which I will remit payment promptly. I feel that I have reached an impasse with the XXXXXXXX collection department, and I kindly ask for your assistance.

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