7 THINGS YOU DIDNT KNOW ABOUT CREDIT AND THE FDCPA

1. When you see "Charged Off" on your credit reoport, it doesn't mean you don't owe the debt. It means that the creditor has sold the debt to a debt buyer. This is different than the creditor giving the debt to a collection agency to collect on. A debt buyer actually owns the debt. A collection agency is collecting for the original creditor (although both are covered under the FDCPA). When you see "Charged Off," you'll probably see the debt reappear with a new entity--the new debt buyer.

2. Speaking of debt buyers, they've bought the debt for pennies. They've bought the debt for pennies on the dollar, so they are often willing to give better deals, and hesitant to sue. When they do sue, they usually don't have the proper paperwork to demonstrate they own the debt.

3. Try not to put personal debts on business credit cards. The FDCPA covers consumer debts--not business debts. Even though $1,000 of consumer purchases on a business credit card is technically consumer debt, it makes an FDCPA case longer, more complex, and more risky.

4. Answer the phone. I know you hate talking to those people. But in many cases, the things that collectors say form the basis of FDCPA cases. And to have a violation, you usually need a communication, which means answering the phone (other than letters, which are a different story).

5. Older debts are weighted less in your credit score. But when you make a payment on an old debt, the activity on that debt increases its "weight," and it gets treated as a new debt. So if you're looking to pay off some debt, start with the newer debt.

6. You don't need to dispute a debt in writing. You can dispute a debt orally. And if you dispute a debt to a debt collector, and it shows up on your credit report, that's an FDCPA violation.

7. Collection agencies want to know who is suing under the FDCPA. There are companies that publish lists of people who sue under the FDCPA and sell them to debt collectors and collection agencies. That means that when you sue under the FDCPA, you may be put on that list. What does that mean? There's no way to know with 100% certainty, but likely it means you're less likely to be harassed by other debt collection companies, and possibly, less likely to get sued. If collectors know that you know your rights and arent afraid to assert them, they'll move on to easier targets.

8. You can assert your FDCPA rights even if you really owe the debt being collected. The FDCPA is about being treated fairly by debt collectors. Collectors who collect all debts--even validly owed debts--need to comply with the law, and all consumers, even those who really owe money, have a right to damages under the FDCPA if collectors harass them, or make misrepresentations to them.

Getting collection letters in the mail? Let me look them over. Email them to jason@jasonweaverpa.com. Free. No obligation. I'll give them a lookover, to make sure that the letters you're getting from creditors are FDCPA compliant.