Collection Agency

[huey1124]

Hi,

I have a question for a co-worker of mine. While she was in college, she owed some money by not paying some school fees, which amounted to around $1000. Now that she's employeed, she is able to pay it back. The debt (considered student loan?) has been turned over to a collection agency sometime ago, and she told me she still receives collection letters from them. She wants to contact them and pay it back, but she has few questions.

1. Can she pay the debt back to school directly? She thinks maybe the school can make the debt current?
2. Can she settle with the collection agency by offering less money than she owes (although her original debt was $1000, collection agency wants around $1300, including fees and interest)?
3. Is there anything she can do so this doesn't go on her credit report negatively?

She would really like an answer ASAP, so she can pay it back. I thought maybe this is a good place to ask. Thanks in advance.

 

[CPA]

1. If the receivable was factored out to the collection company (good chance of that) then, no she should pay the agency. She could always call the school and see how they handle their outstanding receivables.

2. You can negotiate anything. Can't hurt to try.

3. Probably too late for that. Pull her credit report, you will probably see it on there already. If not, then it won't go on there when she pays.

 

[bozo1]

One thing she might try is contacting the collection agency and offer to pay the debt in full IF they remove the entry completely from her credit file. If they agree, get it in writing BEFORE giving them any money. I've done that a few times. Make sure the debt is removed completely and not just updated to show that it has been paid because it will still show up as being a collection entry.

 

[huey1124]

Thanks a lot guys! I just pointed this thread out to her, so she can read it herself. She thanks you as well.

 

[human2k]

Originally posted by: huey1124
Thanks a lot guys! I just pointed this thread out to her, so she can read it herself. She thanks you as well.

You don't have to lie that it's you.

 

[Looney]

Hmm out of curiousity, aside from having a bad credit rating, what can the collection agency do to you? Nothing but send you letters? Legal actions?

 

[slycat]

Originally posted by: Moralpanic
Hmm out of curiousity, aside from having a bad credit rating, what can the collection agency do to you? Nothing but send you letters? Legal actions?

yes, they will send Rossman to your place to collect and you know his thirst is unquenchable.

 

[glen]

Originally posted by: bozo1
One thing she might try is contacting the collection agency and offer to pay the debt in full IF they remove the entry completely from her credit file. If they agree, get it in writing BEFORE giving them any money. I've done that a few times. Make sure the debt is removed completely and not just updated to show that it has been paid because it will still show up as being a collection entry.

Tell me more.
You are implying they have 2 levels of removal avaiable to them?

 

[yoda291]

Originally posted by: Moralpanic
Hmm out of curiousity, aside from having a bad credit rating, what can the collection agency do to you? Nothing but send you letters? Legal actions?

I don't see how that's anything to scoff at. In today's economy, your credit rating is, quite possibly, the most important thing you have.

I think after a year, they usually give up as it shows that you can't pay and it'd cost more to pursue. but I wouldn't consider buying a house anytime in the future.