buyout

It really depends on the debt and the age of the debt. A delinquent debt that is not very old may not have been sold at all. Instead the creditor may just pay a collection agency to attempt collection. If it is a really old debt in the 10 year range then I doubt the agency even paid 1 penny per dollar on it. Those junk debt buyers purchase 1000???s of accounts in a bundle for very little money and then start working them.

I have never been successful in getting documentation showing that a collector owns the debt and how much they paid for it. In my experience they are either directly related to the original creditor and are paid a percentage if they collect or they can???t prove they own the debt at all.

They are under no obligation to tell you what they paid for the debt.

The only way you are most likely to get them to tell you what they paid for the debt is if they sue you in court. Serve THEM with interrogatories and request for production of documents. If they fail to reply then motion to compel, if they still don't then motion to dismiss. If the motion of dismiss gets denied and you still haven't found out how much they paid for the debt then use Unjust Enrichment as a defense along with either volenti non fit injuria or contributory negligence....

All that will get you one of a few things. The judge would be a jerk and make you pay the full amount, highly unlikely.

You will only have to pay them what they paid for the debt or you will not have to pay anything at all.

Again CA's are not required to disclose this type of information...what they paid for the debt is actually irrevilant to the actual collection of the debt They may pay a certain amount for the debt but then they have to work the debt to make it collectable which costs them money..phones, letters, salaries,building payments, insurance...the list is endless.

Guest, that all sounds well and good. Personally I think it's just a bunch of jargon.

All they have to prove is assignment of the debt. If the assignment is valid, then it doesn't matter how much they paid for it. It's governed by the laws of contracts, and it's not illegal to buy debts at a discount.

Take your car-note for example. You might be surprised to know most finance companies buy contracts from the car dealer at a discount. For example, you might agree to pay $30K for a car and finance it through a bank, but the bank will only pay the car dealer $25K for that contract. Does that mean you can use all that jargon in court and not have to pay for your car, or pay less for it? The answer is no.

The opposite is true too. I've sold car paper to other finance companies at a premium, meaning they paid more for the contract than the customer owed at that point in time. If you're saying an assignee should sue for how much they paid for the debt, then that finance company could have included the premium in the loan balance and sued for more than the customer owed? No, because the present value of the debt is not affected by any "side deals" made to buy it.

What about "Flilure of Consideration" in this case where No exchange of money or goods occured between plaintiff and defendant?

Speaking of forcing a CA to cough up documents in a suit, couldn't you also compel them to disclose the costs associated with the debt? Soaplady mentions letters, salaries, etc...so couldn't you also get them to prove how much they spent collecting upon an account during discovery?

I am not sure what good it would do..other then to bog the CA down in paperwork, or maybe to argue that 'unjust enrichment' if it was proven that even with all the costs involved, it still doesn't justify the amount they are trying to collect. Not sure if it works that way. :)

The only way I can see that being relevant is if the CA tacked on "collection costs" to the balance.

For example, if they were trying to charge a $350 collection fee, then you might argue that they spent nowhere near that amount and try to get them to prove it.

But if they were only trying to collect on the principal balance of the debt, with no extra charges added, then I think a judge would agree that their collection expenses have no bearing on the case.

Well, I mostly meant if someone tried that 'unjust enrichment' and the CA came back with operating costs and such, couldn't you come back with asking to see these costs since they brought it up in the first place?

To Sis -

The consideration was given to you by the original creditor (in the case of credit cards, your consideration is the amount they expended on your behalf to let you put charges on the card). Under contract law, debts can be re-assigned, and there need not be consideration between you and the assignee for the debt to remain valid.

Yes I suppose if the CA themselves used the costs as some sort of defense, then they should prove it.

I wonder who's ever used the 'unjust enrichment' argument and got anywhere with it? Personally, and I'm not trying to be mean, I think a judge would laugh if someone tried to use that argument as to why they shouldn't have to pay a debt.

Hmm. Good point. If you got to the point where you got all the documentation in the discovery and they proved everything..you might as well just accept the fact they got ya and pay it. Though I would
**** bitterly about it never having to go to court if they had provided the DV in the first place, course, i8f they sued me in response to a DV I would have countersued for that little stunt.

If they couldn't provide the documentation you wouldn't need to bring up this unjust enrichment because they couldn't prove you owed it at all.

[color=Red]****Adult term removed - Jason[/color]

Precisely. I've read that when they buy up portfolios, many times all they're buying is a spreadsheet with names, SSN, balances, etc. More often than not, they don't have anything with your signature on it.

That's why they depend on you not showing up to court, just so they can get a default judgment. I think if you show up and just deny the debt and make them prove you owe it - that's a better strategy than trying to get them to reveal how much they paid.