[jeepin1179]

I have an old debt that was last paid on in 2000. Rubin and Rothman called my place of employment today looking for my human resources manager. In my small office of 9 people, 1 salaried employee (myself) there is no HRM. So she asked to speak to me. She never identified herself so I said "this is". She then acted like we were long lost friends and told me that she has been looking for me for a long time. She then asked if I ever had a beneficial acct, I told her that I was never aware of one and she said "Oh!" She proceeded to state the amount that I "owe". Never in my conversation with her did I ever admit to or acknowledge the debt. I told her that I wanted it in writing. She is sending me something in the mail via a PO box. My old PO box that I still have open, I was not going to give her my new address. I know that in NY that statute is 6 years and it has been 8. What steps do I take from here?

[LadyB]

You've stated you don't know if the account is yours, so when you receive whatever from the collections company (will probably just be an assertion that you owe and demand for payment) you should respond in writing that you dispute the debt and request a validation (sample request for validation letters are available on this site and others) and a request that all communications be made in writing and there are to be no phone calls to your work. Is it still on your credit reports?

They have a right to try to collect on a debt, even after the statute of limitations has expired, as long as they stay within the law.

[jeepin1179]

LadyB,
I know that the debt is mine. I am not sure if it is still on my credit report. I will look when I get home. I remember that last activity on that acct was in 2000. She also asked if she could fax it to me and I gave her my fax number- she then called back about 20 min later and said that there was too much to fax and that it needed to be mailed. I am not sure how that relates to what you said is an assertion and a demand. Do I not have a leg to stand on with these folks using the statute?

[LadyB]

You have a leg to stand on if they sue you, "time barred" is a positive defense.

It sounds like she might be planning to send more than a simple dunning letter, possibly an account summary or full validation. If they send you any kind of accounting with charges and payments etc. you need to dispute it immediately, or they can try to restart or extend the statute of limitations under an "account stated" theory (basically they send you an account summary, you don't dispute it, they assume you accept it as valid) they are tricky. I was sued on a time barred open account under the account stated theory, which had a statute of limitations twice as long in my state.

So, see what it is they send you, that will inform what you should do next. If the account summary shows a date of last payment as 2000 as well, you can use the statute of limitations in your dispute letter, amongst other things.

[ScottGem]

I'm not sure you understand what the Statute of Limitations means. The SOL is simply a time frame within which one party can take legal action against another party over a legal issue. If the SOL has expired on this debt it simply means they can't take you to court to collect on the debt. It does NOT mean they can't dun you for it. The debt NEVER expires.

Whether its still on your credit report or not is not of issue either. They may even be able to place it back on your report.

So if this is a valid debt, then I would offer to settle (after they have verified it).

[LadyB]

Whether its still on your credit report or not is not of issue either.

It is simply additional information, and can be used when negotiating a settlement, to either party's advantage.

[jeepin1179]

How would I negotiate a settlement? Is it like bidding on a house where you both come up with numbers till you can agree on one? I know that it may be a silly question... They told me the debt was $4347.30 what figure do you think they will come up with? Would it be better for me to contact the original lender?

[LadyB]

Here's the issue as I see it, and why you will find many different views here and elsewhere on the net.

People have an obligation to pay their debts. I don't think anyone disputes that. Due to circumstances, one may be unable to pay their debts, or pay them timely, which leads to collections etc. If your circumstances have changed, and you are now able to satisfy your debt, either partially or in full, you should try to do so with the original creditor.

Where opinions start to go in different directions is whether one should pay the debt to a zombie debt buyer that has purchased it for pennies on the dollar. Many feel these companies are bottom feeders and should simply not be dealt or negotiated with at all... and if the original creditor is unwilling or unable to validate the debt for you directly (and thereby be free to negotiate settle), because they have written off the debt on their profit and loss and sold it outright or purged your files or whatever, you should then dispute it/fight it outright with the debt buyer.

I am of the opinion, personally, that settlements etc. should only be made with the original creditor (if possible), and have found they are usually willing to negotiate very fair settlements based on your current circumstances. I (again personally) recommend against negotiating/settling with debt buyers unless necessary to clean up your credit report if needed to get a loan or something.

Some people disagree with my opinion, others agree. You need to decide how you feel and what you can do within the frame of your own values/morals system.

[jeepin1179]

So you feel that I should contact the original creditor and explain to them my current situation and willingness to pay? Will they be willing to take a less amount to remove it from my credit or will they just say that they will remove it because it has been long written off?

Sorry to be a pain with all the questions...

[ScottGem]

First let me comment on what Lady B said. Collection bottom feeders get the debts they try to collect in one of two ways. Either a creditor outsources the collection to them, in which case they get a percentage of what they collect or they actually purchase the debt outright, generally for pennies on the dollar.

If the debt has been sold you cannot negotiate with the original creditor. They no longer own the debt and cannot deal with it. Most creditors will tell you that you have to deal with XYZ or that they no longer have a record of the account. If the debt has just been outsourced, they might deal with you, but most often they will refer you to the collector, because they may still have to pay them.

So I disagree with her about negotiating with the original creditor. The vast majority of time, it just won't happen.

Because most of the time purchased debt was purchased for a fraction of its face value, if they can collect anything, its mostly profit. So they are often willing to accept a lump sum settlement as much as 50% of the face value, maybe less. However, if you can't pay a lump sum, then they they will be much less willing to accept a lesser total repayment.

Now my opinion here is that the debt is an obligation, but that obligation doesn't extend to compounded interest, legal fees etc. So you you should try to settle for the balance at the time you defaulted.

I do agree that one should fight it, not to get out of the debt, but to not give in to these sharks. Make them at least work for what they can collect. And if they are stupid enough to purchase a debt without sufficient documentation then that's their loss.

[LadyB]

Is it on your current credit reports? If it is, in fact, 8 years old it should have come off. That's why I asked earlier... having a negative item on your credit report works in the collection agency's favor, because you want it off, or at least want it to show settled and closed rather than open and in collections.

If it has aged off your reports, and is time-barred, that works in your favor in negotiations because you don't have much outside incentive (except your personal values wrt to payment) to settle it at all... and then only if they can validate it.

I spent two years settling a number of debts when my situation improved, and found most of the original creditors receptive, that was 6 and 7 years ago though, and they seem much more apt these days to sell them outright rather than outsource their collections.

[jeepin1179]

I will check my report when I get home and tell you what it says.
also- with your statement "except your personal values wrt to payment" was the bold area a typo or short hand?

[LadyB]

I will check my report when I get home and tell you what it says.
also- with your statement "except your personal values wrt to payment" was the bold area a typo or short hand?

Shorthand for "with regard to"

What I meant was, if you feel morally impelled to do what you can to pay/settle this debt, then that would be your only incentive to do so, if the credit report and possibility of a lawsuit are not issues.

[jeepin1179]

Possibility of a lawsuit? Them suing me for monies not paid?

[LadyB]

Possibility of a lawsuit? Them suing me for monies not paid?

Correct. The statute of limitations is only for legal action to collect the debt, not collections efforts entirely. They can legally attempt to collect forever, if they wish, as long as their efforts and behavior are lawful under the fair debt collections act.

If the debt is actually time-barred, meaning past the statute of limitations, they should not be able to sue you. However, many of these debt buyers artificially re-age the debt, or manage to restart it legally by getting you to agree to pay or making a payment or in some other way tripping you up to allow the clock to restart. Many, many consumers are being sued on time-barred and unvalidated debts, and/or paying for debts they didn't even incur, these days simply because they don't know how it all works.

Here is an excerpt from the Association of Collections and Credit Professionals website, discussing time-barred debts and credit reports

Credit Reporting
It's important to understand the time restrictions imposed by state statutes of limitations do not hinder a creditor or its agents from reporting a debt to a consumer reporting agency, provided the debt is still reportable according to the provisions of the Fair Credit Reporting Act (FCRA). The FCRA allows a debt to be reported for up to seven years from the date of delinquency, a longer time than many states' statutes of limitation.

The interaction of these bodies of state and federal law is often misunderstood by both debt collectors and consumers. Often a consumer will assume that because the debt is not legally enforceable, it should not be reported on the consumer's credit report. After this distinction is understood by the consumer, the existence of the negative information on a credit report can be a powerful tool to motivate the consumer to pay the debt, regardless of the legal remedies available to the debt collector. Consumers often pay debts beyond the applicable statute of limitations because they need to obtain credit to purchase a home or automobile and the negative report is affecting their ability to secure credit.

I am going to stop responding here, but please do yourself a favor and do some research. Google "Collections on time barred debts" and "Debt buyer collections" to get your started