So. I Was Denied Federal Loans Due To An Old Open Collection Forum

[TexasDemocrat]

@TD, you found a copy of Puffy Areolas? Weird...

The Blind Side. I love it. It makes me cry.

[Fark-o-vision]

Good advice all over here. I do disagree with the idea that the OP was stupid, or irresponsible, in not paying this bill at the time.

I had a similar issue with AT&T back in the day. The deleted my automatic payment, sending my bill into default, and then tried to collect over $1,000 from me. They admitted they didn't know why my auto pay had been removed, acknowledged that I hadn't done it, but maintained that there was nothing they could do. Was I responsible for this? Sure. I should have noticed that the money wasn't coming out of my checking account, should have watched my cell phone account regardless of the recurring payment. Shouldn't have had my electronic statements going to an old email I didn't check anymore.

I maintained, as I still do, that there was still some shared culpability. I was willing to pay the back payments, the late fees, but I didn't want to pay the restart + shut off fees for each phone (85 or so dollars each for three lines). Arbitrary? Maybe. I don't know. Still, if felt like a moral stand and only minimally effected my credit. As far as I can tell Grad plus loans are the only loans that operate in this manner. Like the original poster, I've bought cars, gotten credit cards, and even financed a home after that and whatever little ding on my credit report it caused it was worth it to screw those fuckers at At&t.

The moral of the story? You never screw those fuckers at AT&T. Just pay the bill.

[jmhendri]

@TD, you found a copy of Puffy Areolas? Weird...

The Blind Side. I love it. It makes me cry.

yeah, that was a pretty awful movie. it makes me sad too.

[TexasDemocrat]

The moral of the story? You never screw those fuckers at AT&T. Just pay the bill.

AT&T has a history of doing things like this without your request and then later having no idea how and why it happened. About three times now they've managed to remove my unlimited text messaging plan and they've billed me $500-$1,000, charging me for each individual text.

[wowzers]

The moral of the story? You never screw those fuckers at AT&T. Just pay the bill.

AT&T has a history of doing things like this without your request and then later having no idea how and why it happened. About three times now they've managed to remove my unlimited text messaging plan and they've billed me $500-$1,000 for each individual sent/received text.

They reactivated my plan 6 months after I thought I canceled service and I didn't find out until a couple of years later. I'm not sure what happened there but I'm almost 100% certain that I didn't greenlight their "vacation break" shutoff/reactivation or whatever the H it was. They billed me for six months (at an old address and I never received the bills) and then suspended the account (that I didn't know was even active) before turning it over to a collection agency.

But none of that matters now. I have to handle this first thing in the AM.

[TexasDemocrat]

The moral of the story? You never screw those fuckers at AT&T. Just pay the bill.

AT&T has a history of doing things like this without your request and then later having no idea how and why it happened. About three times now they've managed to remove my unlimited text messaging plan and they've billed me $500-$1,000 for each individual sent/received text.

They reactivated my plan 6 months after I thought I canceled service and I didn't find out until a couple of years later. I'm not sure what happened there but I'm almost 100% certain that I didn't greenlight their "vacation break" shutoff/reactivation or whatever the H it was. They billed me for six months (at an old address and I never received the bills) and then suspended the account (that I didn't know was even active) before turning it over to a collection agency.

But none of that matters now. I have to handle this first thing in the AM.

Not surprised.

[wowzers]

I just spoke with a person at the GradPlus loan disbursement teen crisis call center and they said that I should be cool if I pay it and send documentation along with my full credit report. I will do all of that and then some.

[stintez]

what is a reliable place to check my credit any websites?

[MrKappus]

http://www.annualcreditreport.com

You get 1 free one per year, thanks to the FCRA.

[andreea7]

It is from late 2003 and it's for only $200. Any chance I'll make it on appeal? On my credit report, it shows that the current collection agency grabbed it in 2005. I pulled my equifax and it shows that the negative item reported 05/2010, which must have been the inquiry from the student loan people. I thought I was being unfairly charged for cell phone service that I didn't use (cell phone companies can be shady). I guess I should have paid it, eh?

How does this type of thing usually play out? i've had two auto loans in the past 5 years and I've paid every other bill, including my undergrad loans of course, on time. My credit score is a 700~.

Am I screwed?

Hmm, I think you should settle with the collection agency and have them remove the collection from your credit report. I read it is possible to settle such things for as little as 25 percent of the amount but given your situation you should probably do it faster. Get it IN WRITING that they will remove this from your credit report. This process will though take a little while, but meanwhile see what kind of paperwork you can put together -- including correspondence with the collection agency -- to appeal this. Did the collection agency ever contact you? Etc. etc. etc.

[HBK]

At the beginning of the call, I always tell collection agencies "I have to let you know that this call is being recorded."

They record all their conversations with you, so why not record your conversations with them? Most collection agencies, especially the ones that buy paper are notoriously bad.

If anyone cares, I can explain why and how the process works:
After the original creditors have exhausted all efforts to collect a debt, they are looking to make some money, any money on the debt. So, depending on the debt, they sell the account for pennies on the dollar. These portfolios of accounts (we're talking thousands) are generally bought by investors. If the investors buy the accounts for seven cents on the dollar, they expect to recover at least 8 cents on the dollar. Sometimes the investors own agencies, a lot of times they farm the work out to other agencies. The margins on portfolios can be very tight. A portfolio of accounts the investors bought for seven cents may only return seven cents. In this case, the investor is losing money. They have to send at least one letter (debt validation) but generally send more. Phones calls and office buildings don't pay for themselves. After a good work up on the account (letters, phone calls), an agency will just sit on the account hoping that you'll see this on your credit report and pay it off.

The reason your credit report showed the debt refiled is probably because after a year or so, the investors who bought your debt for seven cents sell it to other investors for 3 cents or 2 cents (the price doesn't matter, this is all hypothetical). Accounts can be bought and sold several times throughout the 7 year statute window.

Now, the standard statute of limitations on debts is seven years. However, if you make ANY payment, on the account, that timeframe resets itself. I hear stories all the time of people who owe thousands of dollars getting a call a year before the debt is about to drop off credit asking "Please just pay $100 on this account."

There is even a market now for "Out of Statute" debt. People are collecting on accounts that are 10 years old and not on any credit report.

Anyway, the reason AT&T won't help you is because they probably have zero say regarding the debt. They likely don't own it anymore.

With statute about to kick in, you could wait for the thing to drop off in August, or call them (record it) and tell them you'll pay them if they Bullseye the account. A bullseye is a communication to the credit bureaus to immediately remove an item. All agencies can bullseye an account, it's what they do if they report to credit in error.

A few words to drop to let the agency know not to screw with you: FDCPA and FCRA. Read up on them.

Good luck

[Kiersten1985]

This sucks and I hope everything works out, but for future reference you can't just not pay your bill because you think it's "unfair." Next time pay first and THEN dispute the charge.

[HBK]

This sucks and I hope everything works out, but for future reference you can't just not pay your bill because you think it's "unfair." Next time pay first and THEN dispute the charge.

No, dispute the charge before you pay. They have no incentive to fix a mistake if you already paid it. However, you need to dispute it and have it resolved within the month. Don't go past due. Be diligent and get it taken care of. It shouldn't take a month to reach a resolution. If they won't budge, then pay it, and never do business with them again.

OP should have taken care of this a long time ago.

[AppsAbound]

When was the account sent to collections? If it was really sent in 2003 and you haven't paid since then it should be off or coming off your credit report very soon. Accounts generally fall off around 7 years from the default date. Paying it will keep it on for 7 more years. If the company is not using your original default date you should be able to dispute the account even being on your credit report.

If you pay in full or settle the account you should contact the company to see if they would agree to stop reporting it to the credit bureaus. Sometimes they will agree to do that if you pay in full. Any such agreement needs to be in writing, and you should get a copy of it before you pay.

[wreckem]

I wouldn't pay the full amont to the collections people. If you owe 200 offer them half, they'll probably take it. Don't tell them what situation you're in or they'll bend you over.

Um, just pay the $200. Settling is annotated differently and will impact your credit score. It's not worth the $100 you will save.

On a debt this old it would barely effect his score. Its about to drop off within this year. This older a collection is, the less it matters a collection nearing 7 years doesn't hurt your score that much. But it will auto ding you for GradPlus.

[wreckem]

When was the account sent to collections? If it was really sent in 2003 and you haven't paid since then it should be off or coming off your credit report very soon. Accounts generally fall off around 7 years from the default date. Paying it will keep it on for 7 more years. If the company is not using your original default date you should be able to dispute the account even being on your credit report.

If you pay in full or settle the account you should contact the company to see if they would agree to stop reporting it to the credit bureaus. Sometimes they will agree to do that if you pay in full. Any such agreement needs to be in writing, and you should get a copy of it before you pay.

This is FALSE. Once a debt is past the statute of limitations, typically 4 years, your debt can NOT be re-aged unless you agree to pay it and then fail to pay it. Paying in full or paying a settlement amount does NOT restart the 7 year clock.

[stintez]

GD how good does your F*C(ing credit score have to be to go to law school or at least get the loans needed to go?

[wreckem]

At the beginning of the call, I always tell collection agencies "I have to let you know that this call is being recorded."

They record all their conversations with you, so why not record your conversations with them? Most collection agencies, especially the ones that buy paper are notoriously bad.

If anyone cares, I can explain why and how the process works:
After the original creditors have exhausted all efforts to collect a debt, they are looking to make some money, any money on the debt. So, depending on the debt, they sell the account for pennies on the dollar. These portfolios of accounts (we're talking thousands) are generally bought by investors. If the investors buy the accounts for seven cents on the dollar, they expect to recover at least 8 cents on the dollar. Sometimes the investors own agencies, a lot of times they farm the work out to other agencies. The margins on portfolios can be very tight. A portfolio of accounts the investors bought for seven cents may only return seven cents. In this case, the investor is losing money. They have to send at least one letter (debt validation) but generally send more. Phones calls and office buildings don't pay for themselves. After a good work up on the account (letters, phone calls), an agency will just sit on the account hoping that you'll see this on your credit report and pay it off.

The reason your credit report showed the debt refiled is probably because after a year or so, the investors who bought your debt for seven cents sell it to other investors for 3 cents or 2 cents (the price doesn't matter, this is all hypothetical). Accounts can be bought and sold several times throughout the 7 year statute window.

Now, the standard statute of limitations on debts is seven years. However, if you make ANY payment, on the account, that timeframe resets itself. I hear stories all the time of people who owe thousands of dollars getting a call a year before the debt is about to drop off credit asking "Please just pay $100 on this account."

There is even a market now for "Out of Statute" debt. People are collecting on accounts that are 10 years old and not on any credit report.

Anyway, the reason AT&T won't help you is because they probably have zero say regarding the debt. They likely don't own it anymore.

With statute about to kick in, you could wait for the thing to drop off in August, or call them (record it) and tell them you'll pay them if they Bullseye the account. A bullseye is a communication to the credit bureaus to immediately remove an item. All agencies can bullseye an account, it's what they do if they report to credit in error.

A few words to drop to let the agency know not to screw with you: FDCPA and FCRA. Read up on them.

Good luck

The statute of limitations is 4 years in most states. They can report a debt for up to 7 years. Outside the four years statute of limitations they can not re-age your account unless you offer to pay it(in payments), and then fail to pay it.

Any debt outside of 7 years cannot be put on your report and if they send you something just send them a letter stating its outside the statute and stop calling you.

Pay in full or settle do NOT do payment plans.

[meddlingkid]

...

[Fark-o-vision]

GD how good does your F*C(ing credit score have to be to go to law school or at least get the loans needed to go?

This is the problem. As far as I know, student loans are unique in that they don't care how good or bad your credit is. the only thing they look for are defaults. If you have any default, no matter how ridiculous, you fail. Even if you have an otherwise perfect credit score.

[wowzers]

GD how good does your F*C(ing credit score have to be to go to law school or at least get the loans needed to go?

This is the problem. As far as I know, student loans are unique in that they don't care how good or bad your credit is. the only thing they look for are defaults. If you have any default, no matter how ridiculous, you fail. Even if you have an otherwise perfect credit score.

I think I might be OK, but I'm not out of the woods yet. I paid, as per the recommendation of the loan disbursment call center folk, received a fax offering proof, and forwarded it on as directed. One of the people I spoke with made it clear that if there are any other open negatives, I'll have more problems. According to her, people with two or three issues can often swing it, but people with 5 or 6 delinquent accounts hanging out there realistically aren't able to get them taken care of in time, usually.

[wowzers]

GD how good does your F*C(ing credit score have to be to go to law school or at least get the loans needed to go?

I was told that any unresolved issues will get you dinged, but also that a waiver is "likely" if any existing issues similar to mine are taken care of in time.

Yeah, my credit is otherwise great. My stubborn nature almost prevented me from attending law school this fall. It still might bite me in the @ss. I'm not approved yet, and there is no guarantee until the committee gives my file the green light.

[wowzers]

This sucks and I hope everything works out, but for future reference you can't just not pay your bill because you think it's "unfair." Next time pay first and THEN dispute the charge.

Yeah, I f'ed up by not dealing with this years ago. You're absolutely right. AT&T pulled some shady $hit, but I stubbornly avoided the issue when I should have dealt with it.

[andreea7]

At the beginning of the call, I always tell collection agencies "I have to let you know that this call is being recorded."

They record all their conversations with you, so why not record your conversations with them? Most collection agencies, especially the ones that buy paper are notoriously bad.

If anyone cares, I can explain why and how the process works:
After the original creditors have exhausted all efforts to collect a debt, they are looking to make some money, any money on the debt. So, depending on the debt, they sell the account for pennies on the dollar. These portfolios of accounts (we're talking thousands) are generally bought by investors. If the investors buy the accounts for seven cents on the dollar, they expect to recover at least 8 cents on the dollar. Sometimes the investors own agencies, a lot of times they farm the work out to other agencies. The margins on portfolios can be very tight. A portfolio of accounts the investors bought for seven cents may only return seven cents. In this case, the investor is losing money. They have to send at least one letter (debt validation) but generally send more. Phones calls and office buildings don't pay for themselves. After a good work up on the account (letters, phone calls), an agency will just sit on the account hoping that you'll see this on your credit report and pay it off.

The reason your credit report showed the debt refiled is probably because after a year or so, the investors who bought your debt for seven cents sell it to other investors for 3 cents or 2 cents (the price doesn't matter, this is all hypothetical). Accounts can be bought and sold several times throughout the 7 year statute window.

Now, the standard statute of limitations on debts is seven years. However, if you make ANY payment, on the account, that timeframe resets itself. I hear stories all the time of people who owe thousands of dollars getting a call a year before the debt is about to drop off credit asking "Please just pay $100 on this account."

There is even a market now for "Out of Statute" debt. People are collecting on accounts that are 10 years old and not on any credit report.

Anyway, the reason AT&T won't help you is because they probably have zero say regarding the debt. They likely don't own it anymore.

With statute about to kick in, you could wait for the thing to drop off in August, or call them (record it) and tell them you'll pay them if they Bullseye the account. A bullseye is a communication to the credit bureaus to immediately remove an item. All agencies can bullseye an account, it's what they do if they report to credit in error.

A few words to drop to let the agency know not to screw with you: FDCPA and FCRA. Read up on them.

Good luck

The statute of limitations is 4 years in most states. They can report a debt for up to 7 years. Outside the four years statute of limitations they can not re-age your account unless you offer to pay it(in payments), and then fail to pay it.

Any debt outside of 7 years cannot be put on your report and if they send you something just send them a letter stating its outside the statute and stop calling you.

Pay in full or settle do NOT do payment plans.

Some states actually have longer statutes of limitations and then which ones apply? The one where you reside? where you opened the account? (in this case where AT&T kindly opened the account on his behalf?). I am pretty sure based on my own experience with this that it also depends on the efforts the collection agency made to get the money back.

[UF Gators]

According to Michigan's financial aid talk at their ASW, she said that as far as federal loans that are credit-based (Grad Plus) it only took a one time snap shot of your credit and if everything was cleared at that point, then you'd be approved. So pay the collection agency. AT&T already sold the debt, so they don't have anything to do with it anymore. Then you can appeal the credit decision and you should be able to qualify because its checking your credit for negative items, like an unpaid debt, not necessarily a high credit score.

Well, I already applied so my one time snap shot may have been taken, and I could be sunk. Or do they look again? I'm a bit confused now. The collection was originally filed in '03, but then refiled by a different company in '05.

When was the date of your first delinquency, this is when the clock starts to tick on how long derogatory stuff can appear on your credit report. It should list it on your Equifax. It's been 7 years so this should be already off your credit report and if not it should be soon. If it's been over 7 years I would dispute the account with the credit reporting agencies and demand that they delete the trade line.