DebtConsolidationCare [A+ on BBB] Logo
DebtConsolidationCare Forums
Discuss your problems and get out of debt
Get honest and blunt feedback on your debt issues from Experts for FREE
For Free Debt Counseling: Call 800-DEBT-913 or

Original Creditor vs. Debt Collector

member profile picture
Posts: 12
Credits: 392.8
[Donate]

I recently paid the original creditor in full for a past due debt. The original creditor sought a third party debt collector, SourceRM to collect the debt back in November 2010. Around the same time payment was made to the original creditor, the third party collection agency placed an adversary account on my credit report. I spoke with the original creditor's "Executive Services", who stated the person who took my payment should've referred me to the third party collector and she wold advise the third party collector to update my credit report as Paid In Full.

If I paid the original creditor, how can a third party collector report anything on my credit report? I've contacted the Executive Services via email and CC'd the third party collector informing them of what happened, but the third party called to say we've had the debt since November, even thogh you've paid the original creditor, all they did was transfer the money over to us.

Help!




OhioGal1


Debt Samaritan
Posts: 5256
Credits: 83046.796477606

Sub: #1 Generally, when a creditor assigns a debt to a third party (CA),
Mon, 09/12/2011 - 07:57

Generally, when a creditor assigns a debt to a third party (CA), they sign a contract with that CA that prohibits them from continuing to participate in the "collection activities." They are required to refer you to the CA if you contact them. If you sent a payment, they would have sent it to the CA for processing per their contract (likely).

Sounds typical to me.




SOAPLADY


Debt Samaritan
Posts: 17191
Credits: 474465.88869987

Sub: #2 What she said...dead on. The CA would still have earned their c
Mon, 09/12/2011 - 13:17

What she said...dead on. The CA would still have earned their commision and received credit for the payment as a pay direct.




andria.lawson
Posts: 12
Credits: 392.8

Sub: #3 Additional Info
Mon, 09/12/2011 - 13:28

Here's the jist, the CA never contacted me so I didn't know they were collecting on the debt, they didn't even pull my credit report to get an updated mailing address or telephone number, the CA said they're a small company and don't have the finances to cover such a cost thus using the information provided to them by the original creditor, Sprint.

Nonetheless, I paid Sprint in full however, after Sprint received payment the CA posted the adversary account on my credit report. The representative from Sprint at Executive Services stated the person who took my payment should've referred me to the CA but didn't and Sprint will transfer the funds to the CA. However, I didn't pay the CA nor had any dealings with them until I discovered they entered the adversary account on my credit report via credit alert. Sprint states the person who took my payment will be talked with because it was wrong.

Okay with that information, it's not my fault Sprint took the payment. At the same time I don't understand how the CA can place an adversary account on my credit report regarding an account that was paid. If they were assigned the account in November 2010, why didn't they put it on my credit report then? Why wait until the original creditor gets paid to do so? Now Sprint is adamant about not advising the CA to remove their entry because of the date they were hired.




OhioGal1


Debt Samaritan
Posts: 5256
Credits: 83046.796477606

Sub: #4 Even though the CA hadn't yet contacted you, they were still und
Mon, 09/12/2011 - 13:51

Even though the CA hadn't yet contacted you, they were still under contract by Sprint to collect on the account. Sprint collected the funds and is forwarding them to the CA. The CA is reporting the activity on your credit report.

It sounds very legit to me. Sprint referred the account nearly a year ago. Did you honestly think it hadn't been assigned to a CA by now?

You can try disputing it but I don't think you'll get very far.




SOAPLADY


Debt Samaritan
Posts: 17191
Credits: 474465.88869987

Sub: #5 Even if sprint had told you it was with a CA and you paid the CA
Mon, 09/12/2011 - 13:59

Even if sprint had told you it was with a CA and you paid the CA, the outcome would be the same. You will be stuck with it. You were charged off.




andria.lawson
Posts: 12
Credits: 392.8

Sub: #6 I actually did...
Mon, 09/12/2011 - 14:20

Majority of my creditors despite charging off my debt, still owned the accounts and didn't sell, transfer or hire a third party collector. I assumed Sprint wouldn't do the same. Nonetheless, in my opinion I feel that since I had no knowledge of this third party ownig the debt and Sprint accepting my payment, my statement reading Sprint, the third party collection agency shouldn't have placed the adversary account on my credit report. I'd have no argument, if it were Sprint who placed it on there but it's not, it's a third party whom I didn't discuss anything with until after payment was made to Sprint and going to Sprint to request a PIF letter, as well as the discovery of the adversary account on my credit report, and removal of it due to payment being received by the original creditor. Just because Sprint failed to refer me to the CA doesn't mean the CA should be entitled to report on my CR.




SOAPLADY


Debt Samaritan
Posts: 17191
Credits: 474465.88869987

Sub: #7 Get over it....you made a WRONG assumption. It is pretty common
Mon, 09/12/2011 - 15:35

Get over it....you made a WRONG assumption. It is pretty common knowledge that cell phone companies send there accounts to collections within 90 days. Your other creditors probably have sent them to collections too. The CA already had the account...you paid it...a year past due. What would you have done if sprint had referred you to the CA to pay? Same result.




Lian
Debt Samaritan
Posts: 234
Credits: 2709.75

Sub: #8 A debt collector is entitled to report their collection status t
Mon, 09/12/2011 - 16:01

A debt collector is entitled to report their collection status to the CRA anytime after they have been assigned collection authority. Debt collector reporting is separate from any reporting done by the OC.

Payment of the debt terminates the collection, but does not eliminate the fact that the debt collector was assigned collection authority. There is no prohibition against a debt collector reporting the fact of their collection even after the debt is paid.

While they wont normally do that, as reporting of the collection is usually a part of their efforts to collect, which disappear upon payment of the debt, they can report it at any time, as long as they correctly, at the time of reporting, also indicate a $0 amount under their collection account. Kinda unnecessary to report that, but nonetheless not improper.




andria.lawson
Posts: 12
Credits: 392.8

Sub: #9 If Sprint would've owned the debt and been the company that plac
Wed, 09/14/2011 - 12:04

If Sprint would've owned the debt and been the company that placed the adversary account on my credit report, I wouldn't have written this thread. Soaplady, you might want to review and reconsider your tone and approach on some of your responses.

Nonetheless, my position still stands, I have no privy of the contract or agreement the third party collection agency and Sprint. One thing I know for sure, through writing contracts, if you award a contract to a vendor, they are considered the prime, if they hire a subcontractor to perform the work, that's manageable however the prime is still the one who receives the payment unless a novation agreement has been signed & thats federal govt contracting.

Sprint hired SourceRM as a third party collector and therefore still owns the debt. Sprint must communicate to SourceRM to remove the debt. I'm still investigating and thus far awaiting to see how things turn out. I've spoken to both parties and one thing remains SourceRM cannot remove the adversary account until Sprint says so... That's the bottom line. I can admit when I've made poor credit decisions and will accept adversary accounts added to my credit report as a result however in this case, I can't accept and plan to pursue.

Thank you all for your comments.




Lian
Debt Samaritan
Posts: 234
Credits: 2709.75

Sub: #10 You are apparently assuming that the status of the debt governs
Thu, 09/15/2011 - 17:28

You are apparently assuming that the status of the debt governs credit reporting. It does not.
Each party, the OC and/or the debt collector, report items of information pertaining to their status at a certain time. When the debt collector was either assigned collection authority or purchased the debt, they obtained the authority to report that collection authority to a CRA. The fact of that grant of authority does not change based on any subsequent status of the debt.
Is it inaccurate for the debt collector to report that they were assigned collection authority on a certain date? That is what reporting of a collection involves.
As long as the OC retained owenership of the debt, they had the legal right to accept its payment. If they have contractural obligations with the debt collector that stipulate that only the debt collector is authorized to accept payment, but they still accept payment, that is an issue between the OC and the debt collector. Your payment was legit.
The debt collector does NOT need to have permission from the OC to deleter their own credit reporting. Their reporting is separate from that of the OC, and is none of the OC's business.




Add new comment

Attachment
More information
  • Files must be less than 2 MB.
  • Allowed file types: txt pdf jpg jpeg png.
CAPTCHA
This question (Case Insensitive) is for testing whether you are a human visitor and to prevent automated spam submissions.
Image CAPTCHA

Share post
-->

Page loaded in 1.691 seconds.