bored7one4

DV or dispute with bureau new collections that just reported on my credit report?

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The process is not a nightmare. Although, people should have a tax professional assist them.

 

If you look at the second link (specifically page 8) it demonstrates how basic the qualification process is.

 

It's as simple as adding all of the assets in one column and all of the liabilities in another. And then subtracting the two totals.  

 

In any event. I'm of the mind that people should make this inquiry before they commit to settling. 

 

You're right....my fingers slipped.  Its IRS pub 4681.  The important part regarding "insolvency" is on page 5, upper right.

 

Publication 4681 covers usage of FORM 982.

Based on willing's post, it seems like you were looking in the wrong place.  And it seems that you don't have first hand knowledge of the process.  

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1.  Original creditors keep records for more than a few years.

 

They're required to. See http://www.ffiec.gov...ual/OLM_116.htm

 

 

 

I read the information in that link but saw nothing related to credit card accounts. 

 

That is a possible outcome. And it's the same point I alluded to in my recent reply to Willing. A lot of collection lawsuits are filed without the proper paperwork by design. Simply because 90% of the time they win by default anyway. When you request validation before hand then you are potentially "arming" them with the documentation that they need when they may otherwise proceed without it.

 

We'll have to agree to disagree.

 

 

 

So it's really hard to quantify this risk in a broad manner.

 

 

 I feel that's what you've done in certain statements you've made. 

 

 

If a consumer is sued they should seek legal advice from a local attorney.

 

I agree.  Have you read my signature line?   

 

Unfortunately, many of the people who visit this site can't afford an attorney. 

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Based on willing's post, it seems like you were looking in the wrong place.  And it seems that you don't have first hand knowledge of the process.  

 

Form 982 is what is actually filed. I added the link to 4681 to assist with its explanation.  

 

I never claimed to be a tax expert. I just know that it's not a "nightmare" due to my previous client's experiences. 

 

Admin, it appears to me that you feel like I'm attacking your cause. I say that because this post seems defensive.

 

Please know that I'm not. Everyone has their own level of comfort in respect to how they deal with things. My only objective with this exchange is to present you guys with a different perspective towards the strategy. Things that you may have not thought of since you guys haven't sat on the other side of the fence. 

 

I'm probably preaching to the choir with this, but "most" people that are behind on their debt are in an emotional whirlwind. They're stressed. They're depressed. They feel like they're being pulled in 10 different directions at all times. And "most" of them lack a general understanding on how to approach the situation due to them never being in the situation before.  

 

Most of what I laid out in this exchange is logic and common sense based. And it's geared towards the consumer who doesn't want to potentially put themselves in an adversarial situation with their creditors.

 

Not everybody wants to get sued.  

 

I'm just asking that you guys debate about explaining these possible reactions to people when you encourage sending a debt validation or cease and desist letter. Just so they fully understand what they may be getting themselves into.

 

That's my only agenda. 

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The main difference between your "agenda" and our perspective is defined by the main premise of your company.

 

You stated in one of your first posts that you only work with people who have enough money to settle ALL of their debts at once.  To me, at least, this implies that your clients are looking to stiff their creditors for less than they legitmately owe and (based on your lack of knowledge regarding the tax consequences) you expect your clients to also dodge their tax obligations.

 

On the other hand, this  site is intended to offer information to ordinary people who because of extra ordinary circumstances find themselves either with debt they cannnot pay or for which they may not even be responsible.  We try to educate people asto their rights under the FDCPA, FCRA, SOL, TCPA, and other consumer related laws.  It IS NOT our intent  to help people avoid legtitmate debt (while we make a profit) but instead we try to help people make certain they're not getting ripped off by dishonest collection agencies, debt fixers, and bottom feeding junk debt buyers.

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The main difference between your "agenda" and our perspective is defined by the main premise of your company.

 

You stated in one of your first posts that you only work with people who have enough money to settle ALL of their debts at once.  To me, at least, this implies that your clients are looking to stiff their creditors for less than they legitmately owe and (based on your lack of knowledge regarding the tax consequences) you expect your clients to also dodge their tax obligations.

 

On the other hand, this  site is intended to offer information to ordinary people who because of extra ordinary circumstances find themselves either with debt they cannnot pay or for which they may not even be responsible.  We try to educate people asto their rights under the FDCPA, FCRA, SOL, TCPA, and other consumer related laws.  It IS NOT our intent  to help people avoid legtitmate debt (while we make a profit) but instead we try to help people make certain they're not getting ripped off by dishonest collection agencies, debt fixers, and bottom feeding junk debt buyers.

 

 

Willing I've bit my tongue in a lot of my replies to you. I can handle your baseless comments and associations when they're directed at me. But now you're attacking the character of my clients and I have a real problem with that.  

 

I mean no disrespect but you should really start to ask yourself just how much you know about the subject you're engaging in before you reply. A lot of what you have said in these replies is total misinformation.

 

These people that post here. The ones you have given 12,143 replies to. They greatly depend on acquiring solid information that will ultimately help them.

 

How often in these 12,143 replies have you really not had a true understanding of what you were encouraging?

 

And please know, I don't say this in a spiteful way. I'm just wondering if you should educate yourself a little better or at least disclose that you're "not sure" when you post. You obviously are trying to help people. Providing them accurate information or that you're uncertain about the information would help them.

 

When you initially brought up the tax consequences, you made a baseless implication that I didn't mention that to people. Which couldn't have been further from the truth as I clearly state on my website for the entire world to see: that this calculation should made ahead of time. So not only do I tell them, but I want them to figure out what their exposure is and to calculate whether or not settling still makes sense if they have to pay taxes on the forgiven amount before they hire me. 

 

Any who, I think its pretty hypocritical and ignorant that you would have the nerve to make such a baseless accusation about my disclosure practices and then when you're presented with a thorough, common sense and logic based argument about the reactions and potential dangers that debt validation and cease and desist letters potentially create, that you would ignore whether or not you should disclose it.

 

Why aren't you disclosing this information? Do you not agree that what I have spelled out in this thread "potentially" could occur? What does your common sense tell you? How would you react to these letters if you were a debt collector? Don't people who post here who rely on your advice deserve the opportunity to think about these things before they do it? 

 

In regard to your comment: "You stated in one of your first posts that you only work with people who have enough money to settle ALL of their debts at once.  To me, at least, this implies that your clients are looking to stiff their creditors for less than they legitmately owe and (based on your lack of knowledge regarding the tax consequences) you expect your clients to also dodge their tax obligations."

 

This statement right here shows me how much of an amateur I'm dealing with. How do you consider yourself qualified to help people with their debt with such a simple lack of understanding on how to truly resolve it?  

 

First off, I limit my services just to people who can settle all of their "enrolled" delinquent debt right away because that's the only way you can reliably offer debt settlement. Hiring a debt settlement company that prematurely represents you (contacts your creditors before the funds to settle exist) also creates an adversarial situation (similar to debt validation and cease and desist letters) to where the creditor, CA, or JDB commonly segregates the accounts and expedites the collection process. So I put my money right where my mouth is with this ENTIRE ARGUMENT by limiting my services to consumers who have the ability to settle right away. That way, there is no premature representation, and I don't make their situation worse. 

 

Do you think I cutoff the ability to earn income from 90% of the people that contact me for my benefit? I can't wait to hear your reply to this question.

 

I limit my service because if people can't settle their debts right away they'll be managing most of their communications. Since a lot of debt settlement companies won't contact a lot of creditors for awhile to avoid the aspect of premature representation.

 

My logic is pretty simple: if the consumer is managing their communications, what's the point of hiring a debt settlement company when you're essentially doing it yourself anyway? So if people don't have the ability to settle right way but can in 24 months or less, and they prefer settling to bankruptcy or a credit counseling approach, I recommend they do it themselves with the assistance of a debt coach.

 

I could easily offer a long-term program and theoretically increase my income by over 900%, but I actually give a crap about helping people. So I don't.

 

And in respect to your comment about my clients: Wow!

 

You know how I mentioned that approximately 80% of collection accounts are never collected? There is a reason for that. And it's not because people don't want to pay. It's because their current situation won't allow them to. They have too much debt to solve the problem. 

 

The main sources of funds for people that pay in collections are loans from family, cash value life insurance policies, asset liquidation, and loans from retirement accounts.

 

The problem for the majority of people that are in collections that possess these resources is that the amount of money they can generate from them isn't enough to solve their entire delinquent problem. So for many, it doesn't make sense to utilize the resource if they will still have a large amount of delinquent outstanding debt with no solution for it.

 

They often won't have a solution for the remaining accounts because there is generally a new monthly payment associated with their resource. So many people who are in this situation lack the financial capacity to tackle the remaining delinquencies and thus remain in credit purgatory. Which makes the premise of tackling any of it pointless from a rehabilitation and recovery standpoint.        

 

So I developed my method to help these people that fit this description resolve their entire problem. 

 

In respect to the "tax dodging": again, wow! 

 

Uncle Sam thinks that if someone has a negative net worth (meaning they owe more than what they own) that they shouldn't be held liable for taxes. Do you disagree with their position? Do you feel that people who lack the ability to pay the taxes should?

 

Per the IRS there is no tax obligation. Dodging?!?! Try common sense exemption...

 

What lack of knowledge are you referring to? Calculating the tax is as simple as adding up all of the assets and liabilities and subtracting the two totals. What other knowledge is needed?  

 

How about you call an accountant and ask them if this process is a "nightmare." I'd imagine they'll laugh...

 

In respect to the sites intentions: I applaud it. Although, I would like to see bankruptcy in your listed options. For many people who can file Chapter 7: bankruptcy is the best choice. 

 

I would just think that you would be more open minded about what I have described to you about your advice on sending debt validation and cease and desist letters. Especially with your limited knowledge. Again, your mission is to help people. I have offered my perspective to assist you in doing that. I'm merely trying to help you help others. And from my very first post here you have attacked me and never acknowledge one point that I have made.

 

Just disdainful reply after disdainful reply....

 

Also, something I noticed that I failed to mention previously but should: people with assets and known employment are the ones that really need to think twice before sending debt validation (on valid debts) and cease and desist letters. If you don't possess any assets or they're unfamiliar with your place of employment they're a lot less likely to pursue you. Since there is nothing to go after.

 

Edited to add: Although, I'm personally of the mind that people without assets or known employment should still mingle with the "herd" and wait to make their validation request until the account is placed with a local attorney and they have filed suit. I'm not an attorney and this isn't legal advice but you can generally request validation by filing an answer after you're served. If you do it any sooner you run the risk of inviting it and preparing them. Just use your common sense. 

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I read the information in that link but saw nothing related to credit card accounts. 

 

 

We'll have to agree to disagree.

 

 

 I feel that's what you've done in certain statements you've made. Which ones? 

 

 

 

I agree.  Have you read my signature line?   

 

Unfortunately, many of the people who visit this site can't afford an attorney. 

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Edited to add: Although, I'm personally of the mind that people without assets or known employment should still mingle with the "herd" and wait to make their validation request until the account is placed with a local attorney and they have filed suit. I'm not an attorney and this isn't legal advice but you can generally request validation by filing an answer after you're served. If you do it any sooner you run the risk of inviting it and preparing them. Just use your common sense. 

http://www.creditinfocenter.com/community/topic/266614-once-youre-in-court-dving-is-useless-really/

 

Once you're served, DVing is useless.  

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Okay, I'm done with this agrument. You've used all the magic words that identifies you, in my mind, as a debt fixer / collection agency.

 

"insolvency", "enrolled debt", "borrow from your relatives, pension funds, etc.",  "don't bother to validate, it will get you sued", "avoid BK", "credit counseling", "settlement advisor".

 

All of the half truths and misrepresentations that collection agencies use to intimidate the debtors they call.

 

As for your clients...I do apologize...I would rephrase my description of them to be those who were taken in by your smooth spiel and friendly banter.  Whether or not they knew up front what you were doing I cannot possibly know.

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 I feel that's what you've done in certain statements you've made. Which ones?

 

Here's a few:

 

"Sending a debt validation letter on valid debts invites lawsuits."

"Requesting validation on valid debts is one of the stupidest things you could do."

"Midland is a fairly aggressive debt buyer who has a high propensity to sue if they're able to validate your debt and you fail to arrive to a timely arrangement."

"But for a valid debt, this is a terrible approach that endangers consumers."

 

 

Those are broad statements to make when suggesting that one not take advantage of the very rights provided to them by law.

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Indeed.  But as your linked post points out, it's the opportunity to actually demand all those documents that is pointless in a DV, and have some hope the court will actually compel them to be produced (unlike in a DV where the demand can simply be ignored).

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Indeed.  But as your linked post points out, it's the opportunity to actually demand all those documents that is pointless in a DV, and have some hope the court will actually compel them to be produced (unlike in a DV where the demand can simply be ignored).

If you take them to court.  

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Here's a few:

 

"Sending a debt validation letter on valid debts invites lawsuits."

"Requesting validation on valid debts is one of the stupidest things you could do."

"Midland is a fairly aggressive debt buyer who has a high propensity to sue if they're able to validate your debt and you fail to arrive to a timely arrangement."

"But for a valid debt, this is a terrible approach that endangers consumers."

 

 

Those are broad statements to make when suggesting that one not take advantage of the very rights provided to them by law.

 

BV80, I truly believe in those statements. And I believe (maybe you don't) that the reasons I've outlined have properly explained why. 

 

Also, I don't think that we're that far off on this. Your position is that people should exercise their rights. I agree with that. Where we differ is on the timing of it...

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How is filing an answer with a request for the exact same proof any different? 

A DV is very different from an answer to a suit.  Some people mistakenly believe that filing a DV suffices as answer to a lawsuit.  In addition, usually documentation you request from a collection agency in a lawsuit is requested through the discovery process, which can be lengthly.  

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BV80, I truly believe in those statements. And I believe (maybe you don't) that the reasons I've outlined have properly explained why. 

 

Also, I don't think that we're that far off on this. Your position is that people should exercise their rights. I agree with that. Where we differ is on the timing of it...

I'm sorry you believe in these statements: 

 

"Sending a debt validation letter on valid debts invites lawsuits."

"Requesting validation on valid debts is one of the stupidest things you could do."

"Midland is a fairly aggressive debt buyer who has a high propensity to sue if they're able to validate your debt and you fail to arrive to a timely arrangement."

"But for a valid debt, this is a terrible approach that endangers consumers."

 

I think you are very far off from believing what @BV80 thinks, but I should let her disagree with you.  

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A DV is very different from an answer to a suit.  Some people mistakenly believe that filing a DV suffices as answer to a lawsuit.  

 

 

Well that's a good reason for your and this boards existence. 

 

 

In addition, usually documentation you request from a collection agency in a lawsuit is requested through the discovery process, which can be lengthly.  

 

Isn't that lengthy process to the consumers benefit? It buys them time which eats into the margins of the collector when you consider the time-value. It also potentially makes the collector more likely to settle for less since it's creating a lot of additional work for them. Furthermore, it gives the consumer time to save up the money necessary to resolve it if they desire to do so.   

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I'm sorry you believe in these statements: 

 

 

I think you are very far off from believing what @BV80 thinks, but I should let her disagree with you.  

 

From what I have gathered, the theme of this board is to exercise your rights. I agree with that.

 

I think the only thing we ultimately disagree on is the timing of it. I feel that if you exercise your rights too soon, you potentially delude the power of those rights. 

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BV80, I truly believe in those statements. And I believe (maybe you don't) that the reasons I've outlined have properly explained why. 

 

Also, I don't think that we're that far off on this. Your position is that people should exercise their rights. I agree with that. Where we differ is on the timing of it...

 

Whether or not you believe them really isn't the point.  The point is whether or not they're true statements. 

 

 I'll say it again:  The information required to validate a debt is not enough to enable a JDB to win a case in court.

 

Are you saying that a DV request made CACH more likely to sue?   What about all the cases that resulted in default judgments?   Do you honestly believe that the majority of those defendants requested validation?

 

Unless you can provide some sort of proof or statistic that shows a DV request is more likely to result in the filing of a lawsuit by the JDB, your statements are not believable simply due to the fact that most JDB cases result in a default judgment.

 

Considering the consumers didn't bother to answer the complaint, I seriously doubt they ever requested validation.   In other words, JDBs file suit whether they receive a DV request or not.  If they're going to file suit, they're going to file suit.

 

Not all JDB cases result in a default judgment.  Some consumers answer the complaint.  As a result, there can't be a default judgment.  if the JDB doesn't drop the suit, they must file a motion for summary judgment.  Upon filing that motion, they then have to have some evidence.  In fact, they must have more evidence than would be required for debt validation.  Requesting validation does not arm the JDB with enough documentation to support a summary judgment.

 

Here's my point.  A consumer who sends a DV request is usually a consumer that is not going to sit back, do nothing, and allow a default judgment to be rendered against him.   He will be more likely to take action by either settling or answering the complaint.  In the event he answers the complaint, the JDB will have to provide more evidence than was required to validate the consumer's debt. 

 

Either way, whether as a response to a DV request or for proof in court due to the fact that the consumer answered the complaint, a JDB will have to obtain some documentation. 

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Midland is a fairly aggressive debt buyer who has a high propensity to sue if they're able to validate your debt and you fail to arrive to a timely arrangement.

 

If they are able to validate your debt?  Midland will sue whether or not it can validate a debt.  Read the court's decision in "Samuels v. Midland Funding," (S.D. Ala. 2013).  It's one of four recently filed against Midland in Alabama.

 

 

ERIC SAMUELS, Plaintiff,

v.

MIDLAND FUNDING, LLC, Defendant. Civil Action No. 12-0490-WS-C.

United States District Court, S.D. Alabama, Southern Division.

February 7, 2013.

 

ORDER

 

WILLIAM H. STEELE, Chief District Judge.

This matter is before the Court on the defendant's motion for judgment on the pleadings. (Doc. 12). The parties have filed briefs in support of their respective positions, (Docs. 13, 17, 18, 22), and the motion is ripe for resolution. After careful consideration, the Court concludes that the motion is due to be denied.

 

BACKGROUND

 

According to the complaint, (Doc. 1), the defendant is a debt collector as defined by the Fair Debt Collection Practices Act ("the Act"). Its business model is to purchase small consumer debts in bulk, at deep discount from the nominal debt balances; to initiate informal collection efforts; and to initiate litigation in the state courts of Alabama if informal efforts fail. The information received by the defendant when it purchases in bulk is too limited to establish the validity of the debt, the defendant's ownership of the debt, or a calculation of the balance claimed; the information the defendant possesses, in short, is patently insufficient to support judgment in its favor. The defendant's uniform practice is to make no effort to obtain evidence that could sustain its burden of proof at trial, and the defendant has no intention of obtaining such evidence or of proving its claims at trial. Instead, the defendant files suit with the intention of either obtaining default judgment or settling with the consumer if he or she responds to the complaint. The defendant appears at trial only to take default judgment or to pressure unrepresented consumers into settlement, not to prove its case, as it has no evidence with which to do so. The defendant has adopted this model because it obtains default judgment or settlement in 90% of the lawsuits it files. In the other 10% of cases, the defendant will appear at trial through counsel but without witnesses or competent evidence, and the trial court will enter judgment in favor of the consumer.

According to the complaint, the defendant followed this pattern with respect to the plaintiff, who denies owing any debt to the defendant. The defendant filed suit after supposedly purchasing the debt as part of a bulk purchase, but without taking reasonable steps to ensure the validity of the debt and with no intention of obtaining evidence to prove its claim but with the intention to intimidate or coerce the plaintiff into payment or suffering default judgment by falsely implying to the plaintiff that it was willing to prove its claim in court. The defendant maintained this intention throughout the litigation and took no steps to obtain evidence to prove its claim. The plaintiff retained counsel and appeared at trial. The defendant's attorney appeared at trial, with no witnesses and no documents to prove the defendant's case. In particular, and consistent with its business model, the defendant arrived at trial with no evidence to prove: the plaintiff created the alleged debt; the date on which the plaintiff defaulted; how the plaintiff defaulted; the date the debt was charged off; the amount due on that date; the amount of principal claimed; the amount of interest claimed; or the amount of other items claimed. On the day of trial, the court entered judgment in favor of the plaintiff herein.

 

Count One of the complaint charges that the defendant's conduct violated several provisions of the Act. Counts Two through Six set forth state law causes of action for invasion of privacy; negligent/wanton/intentional hiring, supervision, etc.; negligence/wantonness/intentional conduct; malicious prosecution; and abuse of process. The defendant seeks dismissal of all claims.

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Isn't that lengthy process to the consumers benefit? It buys them time which eats into the margins of the collector when you consider the time-value. It also potentially makes the collector more likely to settle for less since it's creating a lot of additional work for them. Furthermore, it gives the consumer time to save up the money necessary to resolve it if they desire to do so.   

It's not to the consumer's benefit to be subjected to a lengthly court procedure when the JDB has insufficient proof to bring the case in the first place.  That smacks of abuse.  

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I apologize for the delayed response. I haven't had a lot of spare time these last couple days. 

 

 

Whether or not you believe them really isn't the point.  The point is whether or not they're true statements.  

 
I'll address these one by one...
 
  • "Sending a debt validation letter on valid debts invites lawsuits." 
 
I believe the potential reactions that I have elaborated on in this thread explain how that statement is in fact true. How could you say that it doesn't invite them with what I have presented here? Do you deny that these reactions aren't possible? 
 
  • "Requesting validation on valid debts is one of the stupidest things you could do."
 
It is, for all of the reasons I have thoroughly explained in this thread. The risk/reward is not worth it for the consumer who's ultimate goal is to financially resolve their debts.
 
  • "Midland is a fairly aggressive debt buyer who has a high propensity to sue if they're able to validate your debt and you fail to arrive to a timely arrangement."
 
Here is a recent post where that is exactly what's happening. Please see - http://www.creditinfocenter.com/community/topic/320722-midland-funding-ignored-debt-validation-request-now-served/

 

Does it not make sense that a consumer would have a higher probability to be sued, when they're asking a JDB who is well-known to be legally aggressive in the first place, for the paperwork that would assist them with becoming legally aggressive? 

 

  • "But for a valid debt, this is a terrible approach that endangers consumers."
 

It is. I have dedicated an insane amount of time to this thread to explain why. 

 

I'll say it again:  The information required to validate a debt is not enough to enable a JDB to win a case in court. 

 
Not all JDB cases result in a default judgment.  Some consumers answer the complaint.  As a result, there can't be a default judgment.  if the JDB doesn't drop the suit, they must file a motion for summary judgment.  Upon filing that motion, they then have to have some evidence.  In fact, they must have more evidence than would be required for debt validation.  Requesting validation does not arm the JDB with enough documentation to support a summary judgment.

 

This is true. But that's not the point. It doesn't matter if it's enough. The reason why it increases the chances of being sued are due to the possible reactions that are created. 

 

You may have noticed throughout your time in dealing with this type of stuff that "real documentation" generally takes months to obtain. 

 

So what commonly happens in these scenarios is they will order the "backup" and while they're waiting for it they'll send off what is necessary to meet the requirements of the validation letter so they can initiate collections again.  

 

They commonly do this since previous consumer behavior has demonstrated to them that people who send these letters have a high probability to fight the collection after the "lite validation" is received. After all, sending a letter with FDCPA stuff written all over it doesn't exactly give off the impression that the intent is to pay.

 

In fact, more and more collection entities have gotten to the point to where they totally segregate any accounts that have had communication that included language about the FDCPA, due to the increased frequency of FDCPA lawsuits that they've experienced over the last 10 years.

 

When you send these letters, you give them the indication that you may be likely to sue them for violations. 

 

A lot of them feel that continuing to collect on these accounts is not worth the potential exposure, so they order the documentation and refer them out without ever trying to collect on them through their normal collection channels (calls and letters).

 

So yes, I'll say it again, sending a debt validation letter on a valid debt invites lawsuits. I'm not saying that you will be sued. But I have no doubt in my mind that it increases the likelihood

 

 

 

 

Are you saying that a DV request made CACH more likely to sue?   What about all the cases that resulted in default judgments?   Do you honestly believe that the majority of those defendants requested validation?

 

 

That is absolutely what I'm saying. The ones that resulted in default judgments were slated to be sued anyway. 

 

However, we would refer approximately 5% of our inventory to the legal department. When a consumer disputed a valid debt and we were able to validate it and then failed to collect on it, it was common practice for us to refer it to the legal department if we were familiar with their place of employment or if they owned their home.

 

From a business perspective, if there was something to go after, it would be moronic not to. 

 

Which brings me to my point that when you request the validation, you're assisting in making this decision for the collector.

 

Since I was only required to submit 20 accounts a month to the legal department (out of approximately 400 accounts) back then, people had a 95% chance if they mingled with the "herd" that they wouldn't be one of them.  

 

Does it not make sense when you put two accounts side by side that are fairly similar in characteristics, that the one that has some documentation in-house already would be more likely to be the one chosen for suit?

 

Does it not make even more sense that after sending the validation to the consumer and resolution isn't achieved, that the collector would refer it out?

 

The account comes to an impasse in that situation. If they have a monthly quota, why wouldn't they be more inclined to make that account part of their 20 so they could make room for another account that may pay? 

 

 

 

 

Unless you can provide some sort of proof or statistic that shows a DV request is more likely to result in the filing of a lawsuit by the JDB, your statements are not believable simply due to the fact that most JDB cases result in a default judgment. Considering the consumers didn't bother to answer the complaint, I seriously doubt they ever requested validation.   In other words, JDBs file suit whether they receive a DV request or not.  If they're going to file suit, they're going to file suit.

 

 

Remember, a very small percentage of people send a debt validation request (1 -  3%) in the first place.

 

If 100% of judgments were acquired by way of default then your point would make sense. But they're not. 

 

I think it's reckless to broadly advise people to send a debt validation letter on a valid debt without becoming familiar with their goals and disclosing these possible reactions.

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If they are able to validate your debt?  Midland will sue whether or not it can validate a debt.  Read the court's decision in "Samuels v. Midland Funding," (S.D. Ala. 2013).  It's one of four recently filed against Midland in Alabama.

 

 

ERIC SAMUELS, Plaintiff,

v.

MIDLAND FUNDING, LLC, Defendant. Civil Action No. 12-0490-WS-C.

United States District Court, S.D. Alabama, Southern Division.

February 7, 2013.

 

ORDER

 

WILLIAM H. STEELE, Chief District Judge.

This matter is before the Court on the defendant's motion for judgment on the pleadings. (Doc. 12). The parties have filed briefs in support of their respective positions, (Docs. 13, 17, 18, 22), and the motion is ripe for resolution. After careful consideration, the Court concludes that the motion is due to be denied.

 

BACKGROUND

 

According to the complaint, (Doc. 1), the defendant is a debt collector as defined by the Fair Debt Collection Practices Act ("the Act"). Its business model is to purchase small consumer debts in bulk, at deep discount from the nominal debt balances; to initiate informal collection efforts; and to initiate litigation in the state courts of Alabama if informal efforts fail. The information received by the defendant when it purchases in bulk is too limited to establish the validity of the debt, the defendant's ownership of the debt, or a calculation of the balance claimed; the information the defendant possesses, in short, is patently insufficient to support judgment in its favor. The defendant's uniform practice is to make no effort to obtain evidence that could sustain its burden of proof at trial, and the defendant has no intention of obtaining such evidence or of proving its claims at trial. Instead, the defendant files suit with the intention of either obtaining default judgment or settling with the consumer if he or she responds to the complaint. The defendant appears at trial only to take default judgment or to pressure unrepresented consumers into settlement, not to prove its case, as it has no evidence with which to do so. The defendant has adopted this model because it obtains default judgment or settlement in 90% of the lawsuits it files. In the other 10% of cases, the defendant will appear at trial through counsel but without witnesses or competent evidence, and the trial court will enter judgment in favor of the consumer.

According to the complaint, the defendant followed this pattern with respect to the plaintiff, who denies owing any debt to the defendant. The defendant filed suit after supposedly purchasing the debt as part of a bulk purchase, but without taking reasonable steps to ensure the validity of the debt and with no intention of obtaining evidence to prove its claim but with the intention to intimidate or coerce the plaintiff into payment or suffering default judgment by falsely implying to the plaintiff that it was willing to prove its claim in court. The defendant maintained this intention throughout the litigation and took no steps to obtain evidence to prove its claim. The plaintiff retained counsel and appeared at trial. The defendant's attorney appeared at trial, with no witnesses and no documents to prove the defendant's case. In particular, and consistent with its business model, the defendant arrived at trial with no evidence to prove: the plaintiff created the alleged debt; the date on which the plaintiff defaulted; how the plaintiff defaulted; the date the debt was charged off; the amount due on that date; the amount of principal claimed; the amount of interest claimed; or the amount of other items claimed. On the day of trial, the court entered judgment in favor of the plaintiff herein.

 

Count One of the complaint charges that the defendant's conduct violated several provisions of the Act. Counts Two through Six set forth state law causes of action for invasion of privacy; negligent/wanton/intentional hiring, supervision, etc.; negligence/wantonness/intentional conduct; malicious prosecution; and abuse of process. The defendant seeks dismissal of all claims.

 

That's why I say it's not intelligent for the consumer to invite them to get what's needed when they may not even have it to begin with.

 

Would you agree that if they sued without the documentation that that's to the consumers benefit because the consumer could ask for dismissal with prejudice and potentially never have to deal with again?

 

Why potentially arm the JDB when they have demonstrated that consumers may be able to defend themselves with such a simple defense?

 

It's foolish to do so.   

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It's not to the consumer's benefit to be subjected to a lengthly court procedure when the JDB has insufficient proof to bring the case in the first place.  That smacks of abuse.  

 

Would you mind explaining how involved that typical procedure is for the consumer? Exactly what area's of potential abuse exist? 

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Would you mind explaining how involved that typical procedure is for the consumer? Exactly what area's of potential abuse exist? 

Court cases that drag on for months when the defendant finally proves the CA or JDB doesn't have the documentation to start with?  It's not just abusive, it's criminally cruel.  

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