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Chase Collection Litigation Letter


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First off allow me to say thanks to those who maintain and offer qualified advice on this website. I've been scouring it for hours now, trying to find an answer to my own question in hopes of not posting something you've probably responded to a million times.. but, here we go.

I have two credit card accounts with Chase bank for approx. $8500 and $9000. I was forced to take a pay cut at work and my wife lost her income due to disability. Back in April of 2010, I couldn't afford my payments anymore and quit paying. I signed up with Covenant Debt Solutions and started paying a monthly fee ($468 most of which is their fee for the first several months) in to a savings account with the idea that as it builds,they will begin to negotiate for me, and I can pay the debts in 2-3 years. In reading the posts here, its clear that this is something that I probably could have done on my own, but they look like I reputable company with a decent BBB record so I gave it a shot. Up until the point I couldn't do it anymore, I always made my payments on time but here we are today...

So the letters each address the individual accounts but say the same thing. They are addressed from the Collection Litigation Support Department and list their "In-house Counsel" at the bottom. The letters demand full payment for my balances and 20 days from the date of the letter to respond. The letter says that if I don't respond, my accounts will be forwarded to the attorney's to bring forth lawsuits, wage garnishments, etc....

Should I rely on Covenant Debt Solution to take the lead in contacting Chase now or what process should I start to pursue on my own? I've read a lot about sending letters, etc... but I'm confused as to what time line I should follow in doing so. These accounts are each at least five years old (prob more). Again, any advice would be greatly appreciated! Thanks again for your time!!!:|

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This is the actual text of the letter. Should I be looking to get a BK attorney and get rid of Covenant Debt Sol? I have approx. 30,000 in total debt (the other two accounts are with Capitol One and BofA but haven't heard a word from them). Thanks.

"Over the past several months you have failed to make the required minimum payments. As a result, Chase Bank USA hereby demands immediate payment of the entire balance set forth above."

If you fail to make payment of the entire balance, Chase will refer your account to our attorney, who will be instructed to bring a lawsuit against you for the entire balance due on the account. This could begin a series of events that may potentially result in a judgement being entered against you, and the possible garnishment of part of your salary and/or the attachment of existing bank accounts to potentially pay that judgement."

To avoid a lawsuit, contact one of our representatives at 1-877-412-1996 within 20 (twenty) days of the date of this letter (dated 10-1-10) to schedule an acceptable re-payment arrangement. Otherwise, and without further notice, Chase intends to instruct its attorney to commence legal action against you for the entire balance owed plus appropriate interest and court costs."

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have you called Covenant? what did they say?

Well my actual "rep" had already gone home on Friday when I went in to panic mode, so I was told to call him on Tues or Wed for more information. The rep who answered the phone said it was a "scare tactic" but I'm not sure how much to trust their opinion. They of course would rather I not drop out of the program and start negotiating or handling it on my own since they would be out the rest of their monies for continuing to handle my accounts.... So, I'm looking for a little non-biased advice. Thanks.

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the thing is that you have invested a lot of money in covenant. whether this is a scare tactic or not, I would say at this stage a few days or even a week is not going to change things. it is a scare tactic, and it is a good one because they do sue people.

unless they will give your money back, dropping out will not change the situation with Chase.

If you need to do something immediately, Send a DV letter.

don't make any decisions about Covenant until you speak to someone that can give you real answers about your situation. I don't think it is too much to ask for Covenant to contact Chase before the 20 days expire. Chase does sue people, but they also do debt settlement sometimes.

I am not a big fan of getting other companies to fix your debt, but if you invested in them already then ask them to deliver.

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Well my actual "rep" had already gone home on Friday when I went in to panic mode, so I was told to call him on Tues or Wed for more information. The rep who answered the phone said it was a "scare tactic" but I'm not sure how much to trust their opinion. They of course would rather I not drop out of the program and start negotiating or handling it on my own since they would be out the rest of their monies for continuing to handle my accounts.... So, I'm looking for a little non-biased advice. Thanks.

I know they will try to scare you ,( the creditors) but I thought part of the settlement peoples thing was that they were to handle all the negative calls and letters,

once you signed on.

Since you are with a company, did you have to sign a contract?

Are they taking automatic payments from your checking account?

As to your letter That is a rather standard scare letter. But I wiuld wait to talk to your rep and see what is up and if they will handle for you.

Edited by donqII
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Thanks for the responses. I guess if the intent of the letter was to cause stress.. it definitely worked in my case... I have a little bit of time until their "deadline" expires so I'll see what Covenant says on Wednesday. You've calmed my fears a bit so I'll at least try and enjoy a Sunday of football before losing any more sleep ;-) I'll update my situation as I go just in case someone who's dealing with a similar situation and is also a customer of Covenant comes to the board. I did sign a contract with them but I can discontinue at anytime without owing them future monies, I'd just lose what I've paid them thus far... and it is an automatic debit from my account. Time will tell... Thanks again for the advice!!

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Sorry to inform you that you have been throwing your money away. You don't owe Chase any money. Send them a dispute letter concerning their threats and make sure they go hence with naught. Ask for all accounting entries in regards to the alleged debt and ask them to provide the section of their charter that grants them the power to loan credit.

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If the letter from chase lists their attorney as a male with a last name beginning with D and has a Los Angeles address you might want to prepare for trial. Their in-house California counsel files tons of law suits. I don't know how they are ultimately resolved but his work is tight. His pleadings are the very best I've seen. Of all the bastards attacking consumers he is the only lawyer I'm not looking forward to getting into with.

That said, as Massive points out. Chase should have an admissible evidence problem at trial. Unfortunately, the only way to know for sure is to be sued by Chase and to follow the process. Answer, General Denial, Motion for Leave, Motion to Compel, Motion for Sanctions, Motion to Compel, Opposition to MSJ, Motion for Sanctions.

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Thanks again for all the input. I spoke to Covenant today and they told me to just wait and see if I recieve a summons. If and when that happens, they said they will send me the "form" type letters that I can fill in and send to whomever has been assigned my account to start the process. I asked about the dv letter and they told me that nothing of that sort should be sent until I hear from an attorney or someone other than Chase. They also mentioned that if I talk to Chase and tell them that I'm working with a debt settlement company, they will more than likely fast forward the process and bring suit... I guess for now we will sit back, wait, and read up on the board so I'm prepared.

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Sorry to inform you that you have been throwing your money away. You don't owe Chase any money. Send them a dispute letter concerning their threats and make sure they go hence with naught. Ask for all accounting entries in regards to the alleged debt and ask them to provide the section of their charter that grants them the power to loan credit.

You mean Chase isn't a banking institution?

How does one "loan credit"?

OP, disregard the above-quoted post in its entirety, get your Atty General involved with the debt settlement company and see if you cant get some of your fees directed at chase for a settlement. Keep chase in the loop.

Massive, every time I read one of your posts, this quote comes to mind.

Mr. Massive, what you've just said is one of the most insanely idiotic things I have ever heard. At no point in your rambling, incoherent response were you even close to anything that could be considered a rational thought. Everyone in this room is now dumber for having listened to it. I award you no points, and may God have mercy on your soul.

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  • 2 weeks later...
You mean Chase isn't a banking institution?

How does one "loan credit"?

OP, disregard the above-quoted post in its entirety, get your Atty General involved with the debt settlement company and see if you cant get some of your fees directed at chase for a settlement. Keep chase in the loop.

Massive, every time I read one of your posts, this quote comes to mind.

Mr. Massive, what you've just said is one of the most insanely idiotic things I have ever heard. At no point in your rambling, incoherent response were you even close to anything that could be considered a rational thought. Everyone in this room is now dumber for having listened to it. I award you no points, and may God have mercy on your soul.

Google: Banks And Loaning Credit Ron Paul and you will find all kinds of case law on the subject and then you can publicly apologize to Massive and then we will see who is full of feces.

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Sorry to inform you that you have been throwing your money away. You don't owe Chase any money. Send them a dispute letter concerning their threats and make sure they go hence with naught. Ask for all accounting entries in regards to the alleged debt and ask them to provide the section of their charter that grants them the power to loan credit.

I advise strongly against this advice - no doubt it is not only useless, but they will laugh in your face.

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Google: Banks And Loaning Credit Ron Paul and you will find all kinds of case law on the subject and then you can publicly apologize to Massive and then we will see who is full of feces.

I did just as you asked and found absolutely nothing.

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Massive, I again ask you to lay this out for us. Most all the results from Google go to sites that are all about how we do not owe any taxes, etc which is anarguement that will never fly. The single case law I found was the Credit River Decision which is not going to get you anywhere for a couple of reasons.

It is old (1968) and in court the judge is going to tell you "banking laws and regulations have changed, have you got anything newer?".

Next is that the judge is going to fall out of his chair laughing if he looks up Credit River Township. This court is way back up the river, past podunckville. An indication of just how backwater the place is, the Sheriff reports that in the first half of 2010 they had a total of 15 accidents, 8 involved deer!

The bank at the time had less than 300 customers and could easily be argued that they had lousy proceedures. The bank president testified he personally wrote the note!

Without case law from a court with a little more authority and experience, the arguement is likely to fall flat. I understand the premise, but without some form of case law backing up the arguement a Pro Se is never going to get anywhere. I hope I am missing something in my searches and look forward to being enightened.

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Thanks again for all the input. I spoke to Covenant today and they told me to just wait and see if I recieve a summons. If and when that happens, they said they will send me the "form" type letters that I can fill in and send to whomever has been assigned my account to start the process. I asked about the dv letter and they told me that nothing of that sort should be sent until I hear from an attorney or someone other than Chase. They also mentioned that if I talk to Chase and tell them that I'm working with a debt settlement company, they will more than likely fast forward the process and bring suit... I guess for now we will sit back, wait, and read up on the board so I'm prepared.

Kern,

You are cruising for a bruising with this Covenant group and throwing good money after bad. I just dealt with Chase on a +10K debt, they are going to sue you! You had better start researching how to defend yourself in your courts jurisdiction, rules of court and rules of civil procedure.

Due to the size of this debt I had an attorney represent me and it went to trial. They produced a live witness at trial! Case under submission.

IMO if you aren't going to deal with Chase and try to settle, then you should dispute the account via Debt Validation right now. California has what is called the Rosenthal act which puts the original creditor in the same shoes as a JDB, regarding most of the FDCPA. If you plan on fighting this send DV, so you have asserted your rights under the Rosenthal Act.

If you still think Covenant is going to be there ask one simple question- "If I am sued are you Covenant going to supply an attorney to represent me?" When they say no start saving your money.....

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