Dealing with debt collectors even though bill is paid

by Jennifer
(Sioux City, IA)

We recently have had a lawyers office from New Jersey call us saying that we owe on a credit card from 2001. In 2002 we got a consolidation loan and paid off our credit cards so we thought that was weird and that we are just now hearing from them. They told my husband they were going to sue us unless we set up payment arrangements so he set up small monthly payments of $25 until we could get it figured out. We spoke to the bank that we received the consolidation loan from and recevied a cashed copy of the check we sent to the orignal credit card company to pay off the debt. We called the lawyer and they said that didn't matter because the company had not closed the account and still showed it and unpaid. The credit card company has since been bought out several times and now it owned by Chase. We called Chase and they said since it was so long ago that they don't have the orignal records of how much we owed so they can't tell us if the account has been paid but we could send in a letter with a copy of the check and they would investigate. In the mean time we are still receiving calls from the lawyer and we are not sure what to do to get this resolved.

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Aug 03, 2010
Debt collector trying to collect paid debt
by: Mary

Thanks for submitting your debt collection question on our Q&A page.

I suggest you take a couple steps to try to resolve your situation. First, send the lawyer who has been contacting you a letter asking him to provide you with proof that you in fact owe the money he is trying to collect from you. (Send the letter certified mail and get a return receipt.) You are entitled under the terms of the federal Fair Debt Collection Practices Act to request that a debt be verified and the debt collector is obligated to provide you with that verification. Unfortunately however, the law is not clear about exactly what kind of information a debt collector must send you as verification of a debt, so if the information you receive is not clear or proves nothing, send another letter asking for more explanation.

Second, get in touch with a consumer law attorney who has experience helping resolve debt collection matters. Find out how to get FREE or low cost legal advice about debt collection from a consumer law attorney here.

Meanwhile, I caution you about continuing to pay anything to the lawyer who is contacting you. First, at this point you have no written confirmation that you owe the debt; second, if in fact it's determined that you do not, it is likely to be difficult if not impossible to get back the money you've paid to the attorney. And, most important of all, by paying that money, you may have reactivated the statute of limitations on the debt. This is the period of time during which a consumer can be sued over an unpaid debt and in New Jersey, it's for 6 years after the last payment on a debt was made. If you do not owe the money, then reactivating the statute of limitations on the debt is not an issue for you; but if in fact you do owe it, then by making even $25 payments on the debt, you've potentially complicated your situation because you've opened yourself up to lawsuits.

Bottom line, I advise you to pursue my suggestions right away. In the meantime, I also urge you to get our ebook Debt Collection Answersso you can become more informed about your debt collection rights and know what to do and not do when a collector gets in touch. You can read the first chapter of Debt Collection Answers online for free.

Please share what happens with your situation in the comments section for this question. We are very interested in hearing how this turns out for you, and your experience can help others who are struggling with debt collectors.

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