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Posted: Tue Feb 06, 2007 9:32 pm Subject: Scavenger Debt Collectors

Friends,
I'm new to the forum, so here is my story in brief.
I encountered an overwhelming debt situation with unsecured consumer debt (credit cards) more than 10 years ago. I decided it was a waste of time to attempt paying them down, so I just let go of those cards and payments.

I went overseas on missionary work for 3 years, then returned and have gradually built a modest debt free life this time. I rent, and own 2 old vehicles payment free. I've gradually rebuilt my credit from ashes and even 2 credit cards which I use very carefully. They are a 2 edged sword!

Recently more then 10 years later, I am receiving notices from this scam outfit:
Law Offices of Mitchell N. Kay, P.C. , attempting to offer me a pay off on some of my debts from more than 10 years ago. Statute of Limatations runs out on these kind of debt in 3-4 years in most states. They are at best what is known as a scavenger debt collector. At best that means that they bought the rights to that debt from the original creditor for 2-5 cents on the dollar. At worst they are totally scamming with no rights to the original debt.

DO NOT PAY THEM A PENNY. DO NOT ADMIT TO ANY DEBT. DO NOT AGREE TO A DEBT. DO NOT SEND THEM ANY MONEY.

They are the object of a class action suit right now with lawcash.com.
Please check out that website. There is much free legal help out there. Just search on google and open your eyes.

Beware the scavenger debt collectors and stand up for your rights. They depend on people's fear and ignorance. Don't feed them.

-James

Posted: Wed Feb 07, 2007 11:54 am Subject:

You are right. One must be cautious of scavenger debt collectors. They seem to be not bothered by any of the federal and state laws. The FDCPA is designed just to keep them within their normal behavior and give legal protection to the consumers.

I disagree with you about not paying the debts that you owe. You have this debt since the last 10 years and is always valid until paid. It is your personal decision not to pay anything just because it is past the SOL and the reporting timeframe. If someone wants to pay these kinds of debts, it will be reported in their credit file with a positive remark. If one wants to pay the past debts, it will be a good decision for improving credit worthiness. But make sure that it goes to the right place and doesn't get into the pockets of any shady collectors.

Posted: Wed Feb 07, 2007 12:35 pm Subject:

You should also be aware that leaving the state/country may toll the statute of limitations, meaning the time away may not count towards the SOL. It would be wise to check your dates again if you intend to rely on the SOL defense if you get sued.

Posted: Wed Feb 07, 2007 3:49 pm Subject:

Sol period is not counted as long as you stay from the country. This is a bummer!!!

I know it happens only when there is a payment or when you agree to pay the debt (if it can be proven).

Texaslawyer, please say more on this.. It will be better if you can show where this law is mentioned.

Posted: Wed Feb 07, 2007 4:55 pm Subject:

Each state has its own statute of limitations for each type of claim. For example, Texas Civil Practices & Remedies Code Title 2 Section 16.063 states "The absence from this state of a person against whom a cause of action may be maintained suspends the running of the applicable statute of limitations for the period of the person's absence."

If the SOL has run, making even a small payment or reaffirming the debt may be able to start it all over again. It is important to remember the SOL is a defense which is supposed to put some finality on how long a claim stays alive, but a creditor/CA can still file suit against you. You will then have to file an answer and claim SOL as your defense. Most lawyers will not file a lawsuit if they know the SOL has run, but some lawyers might, especially if they think you will not file an answer.

I guess the important thing to remember is that you can still try to resolve a debt that is past the SOL, but you better make sure you have the terms in writing and that you can meet the terms of your agreement. If not, the SOL is probably restarted. The end result is that you go from a position where a lawsuit could not survive against you to a position where you could have a judgment hanging over your head.

One last thing needs to be said about the SOL. Once it has run, fear of legal action should not force you into resolving a debt. However if you are trying to resolve it for credit score reasons or because you feel a moral obligation, make sure you are protected. I will have more to say on the moral obligation later, probably a post of its own.

Posted: Fri Feb 09, 2007 8:26 am Subject:

I'm dealing with some scavenger debt collectors myself right now. They are big on threats but I don't get intimated anymore. They haven't validated my dv requests yet so I am sending out follow up letters. I wonder if I will hear anything back. I am meeting with my attorney on Monday morning to file suit against one of them. It's going to get interesting LOL!

Posted: Sat Feb 10, 2007 9:26 am Subject:

Good for you Mishele!! I've been dealing with one for over a year now, LVNV. They don't validate, just pass it on to another of their many offices!!..Karen-go get 'em girlie Very Happy

Posted: Mon Mar 26, 2007 4:21 pm Subject:

The way I see it, the SOL defense is rolling over and playing dead when one really should step up to the plate and take responsibility. Even if it is just $10 monthly, is still more honorable. My deepest sympathies are for those who have fallen on hard times and can't make ends meet, but I used to talk to people who had the means to clear their debt, but chose to hide behind that SOL and it made me so sick. Not wanting to deal with a junk debt buyer is understandable, it is always possible to deal with the original creditor.

Posted: Mon Mar 26, 2007 6:32 pm Subject:

The SOL defense is a legal right for someone to plead this affirmative defense in their response to a lawsuit being filed against them. It is not about playing dead or being dishonorable.

As stated before, if you make arrangements to repay any debt, make sure you can live up to the terms. Otherwise you will find the SOL starting over.

Junk debt buyer means they bought the debt. You cannot deal with the original creditor once a debt is sold/assigned to someone else. Giving money to someone other than the actual owner of the debt is throwing money away because it does not reduce the debt.

Posted: Mon Mar 26, 2007 6:54 pm Subject:

From my own experience, I did go over the heads of a third party agency and settle with my original creditor. This was after I found out how much of my mail my ex-husband was throwing away. I was mortified when this happened to me. My ex-husband, any many of the debtors I had to deal with, were the kind of people who throw away their bills with shrug, suggesting that they are "just paper". He and every career debtor like him deserve to be sued. It's people like this who do nothing except take take take don't deserve to have any law to hide behind.

Like I stated earlier, I sympathize for those who have truly taken a hard fall. People who screw society and turn this country into a leper colony can just go to hell.

Posted: Tue Mar 27, 2007 5:52 am Subject:

Texas,

I agree with a lot of what you said here. The SOL is there for a reason. I'm not trying to hide behind any law or nor do I consider myself a career debtor. I made some poor financial decisions in my life and so has my husband. I have been fighting with a couple of "scavenger" CA's since last winter regarding two debts that were written off. I have not been able to find out if the debts were purchased or just turned over. In the meantime, I have been making payments to the original creditor. Now I wonder if I was just throwing money out of the window but the CA's have not validated my debts yet. I say this now because I just got an updated copy of my credit report where these two say they were purchased by another lender. People do fall on hard times. I was laid off from my job in January and we've been having enough problems just trying to meet our regular bills.

Posted: Tue Mar 27, 2007 8:34 am Subject:

I agree with Tex also.Sol is a legal defense to either civil action or reporting action(credit bureaus). It should always be raised if you are sued on this type of debt and you would automatically have counterclaims for FDCPA for sueing on time barred debt.Their only defense is bonafide error. If your dv letter tells them that debt is sol,then bonafide error cannot be used because they have been fully informed and still broke the law. I do agree with most of the posters here on moral obligation of paying your bills.It just needs to be done is a manner that is legally beneficial to you so it does not open you to a lawsuit if you reset sol with payments. An example would be a good written payment agreement stating that debt will not be reported to the credit bureaus and agreement bars them from taking any action as long as both you,the client and them,the company do nothing to breech that agreement. Be very careful and do not make this agreement unless you fully intend on honoring it because it is a written contract.

Law Student · Posted: Wed Mar 28, 2007 3:27 pm Subject:

Thanks for your posts texaslawyer. Here's an interesting bit, someone showed me a demand letter from RJM Acquisions that they recieved last week. The date on the letter was this month (March 2007). It said that RJM is "your new creditor" and that they had purchased the debt. They actually went on to say, "last payment date" (on the account) "June 22, 1993". They seem to really be going out on limbs and relying on consumers not to know their rights (as with the SOL). The SOL in this state is four years.

Texaslawyer is right. Paying a debt purchaser is throwing your money away, and won't help your credit on bit usually.

RJM purchased this $6000 debt for literally pennies, and the kind settlment offer of $2000 in the letter would be all clear profit. Funny, if the mafia were doing this it would be illegal.

Posted: Sat Jun 16, 2007 11:04 am Subject:

Law Student,

That is very interesting. I've been doing some research on scavenger debt collector lately so I'm glad I ran across this thread. It's funny they won't tell you they purchased the debt but they expect you to pay three times the amount. My sister had this happen recently with a debt of her ex-husband's. Luckily, I told her to send a letter stating it did not belong to her, blah, blah, blah. They threatened her though and that just makes me sick to my stomach. Evil or Very Mad

Jada · Posted: Sun Jun 17, 2007 2:43 am Subject:

How often do one of these collectors sue for the credit card debts they bought? If the debtor asks for proof of the debt, will the collector usually not sue?

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