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Verbal settlement with CA's, can I trust them?


Holden Marscott
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I've received verbal settlement amounts with three CA's

(Natl. Credit Adjusters, Northland Group, Natl. Action Financial Services) and am planning to direct proceeds of a loan to them soon. The amounts owed total $45K, settlements are for 40%.

My question is can they be trusted? All debt is from cc accounts charged off by the original creditor in '04. Can I deal with the original creditors after such a long time? Last year I settled with Northland Group on a Macy's account, never received a payoff letter and now it show on my credit report so I'm concerned the same might happen with these.

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Perhaps the best question to ask here is why, when dealing with a $45,000 issue, you would even consider doing any "deal" by verbal agreement only???

I mean really…think about that for a moment and remove the whole issue of that fact that this is collection agency you are dealing with…does doing a verbal deal only make sense?

A verbal contract with anyone isn't worth the paper it's written on and a verbal contract with a collection agency is worth even less.

If a collection agency isn't willing to give you a signed agreement then they are telling you that they WILL screw you.

Get it in writing or don't do the deal - they want their money; they'll put it in writing; it's that simple.

Now, I hope you've properly vetted these agencies through the debt validation process so you know they are actually the legitimate debt holders and/or have the authority to collect.

If in fact the original creditors still own the debts they may or may not be willing to deal with you directly - it never hurts to ask.

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If you're past SOL on all of these, then PFD. Give them nothing without a rock solid written commitment for these to go away. They will take whatever you give them, sell it down the line and the next folks will come after the balance.

Written PIF letter with commit to delete or don't pay. Again, make sure you're beyond SOL.

There are LOTS of folks here that have done what you mention and another CA is after them on balances.

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I've received verbal settlement amounts with three CA's

(Natl. Credit Adjusters, Northland Group, Natl. Action Financial Services) and am planning to direct proceeds of a loan to them soon. The amounts owed total $45K, settlements are for 40%.

My question is can they be trusted? All debt is from cc accounts charged off by the original creditor in '04. Can I deal with the original creditors after such a long time? Last year I settled with Northland Group on a Macy's account, never received a payoff letter and now it show on my credit report so I'm concerned the same might happen with these.

Nope!

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Not only should you get it in writing, but if it were still with the OC and the CA was collecting for them, you would need to get it in writing from the OC too.

You see:

(1) CA owns it, and the agreement is not in writing, they could always come back for the balance, your word against theirs.

(2) The OC still owns it and you get the settlement in writing from the CA, then the OC can go for the balance and say that THEY didn't agree to the settlement and it is THEIR account.

*tapping my foot*...were you TALKING on the phone with these CAs????

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...(2) The OC still owns it and you get the settlement in writing from the CA, then the OC can go for the balance and say that THEY didn't agree to the settlement and it is THEIR account.

I'm not sure about that.

I suspect that if a CA makes a deal with a consumer, that CA is legally obligating the OC to the deal because the CA is acting as the OC's agent.

On the other hand if the CA made a deal he didn't have the authority to make and the OC came after the consumer for the difference then I suspect the consumer would have a cause of action against the CA (and could include the OC as well).

However, I would certainly agree that having a signed agreement from both the OC and the CA is the safest position to be in and clears up any ambiguity.

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(2) The OC still owns it and you get the settlement in writing from the CA, then the OC can go for the balance and say that THEY didn't agree to the settlement and it is THEIR account.

Umm ... the CA has "apparent authority" from the OC and if you settle with 'em it's basic agency law that your debt is extinguished. If the OC comes at you again its claim should not hold up in court.

Where most people have a problem is where their settlement agreement is nonexistent or faulty, or where they simply fail to set the defense up when the creditor sues them. Or when the creditor doesn't sue them but has some leverage like a negative TL when the former debtor goes to buy a house and the creditor refuses to honor the settlement and the underwriter won't buy the debtor's explanation and the debtor doesn't have the time to sue the creditor to straighten it out. Whew.

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I've asked this before and heard mixed things...Can I still send a DV letter even though it's been well over 30 days since first contact? I am curious not so much that I'm disputing that I owe money but i want to make sure who OWNS the debt.

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