How can you find out whom you owe debt?
Problem
I am getting calls from several collection agencies regarding debts. They are calling me and threatening to arrest me if I don’t pay off the debts. But the fact is, I don’t even know who I actually owe money. I don’t know whom should I call or contact, whom should I pay, or how much should I pay. I just have no idea. How will I know if any of my creditors has assigned or sold the account to a collection agency? I have asked the callers to reveal their identity. But they have refused to do so. I can’t pay money to them without knowing their contact details. What should I do? I am so utterly confused.
Solution
I am happy to know that you are one of those consumers who are serious about their debt problems. Several consumers don’t have any idea about their debts and creditors until they start getting collection calls just like you. So, you are not the first man on the earth with this problem.
You should get hold of a copy of your credit report from the credit bureaus – TransUnion, EquiFax, and Experian. You can also glance through the sample credit report of each of these bureaus so as to understand your reports correctly when you receive them. A credit report is a record of your credit activity. You can view your personal information, public records, accounts in good standing, accounts that have gone to the collection agencies, credit inquiries, etc, from the report. This will help you have an idea about your creditors and the collection agencies.
After getting the name and contact details of the creditors and collection agencies from your credit report, you can start contacting them. You can work out a payment plan with your creditors directly. Once you reach an agreement, you can start repaying your debts. If your creditors have assigned the accounts to the collection agencies, then you can request them to withdraw the accounts from CAs for full payment of the debts. This can be a great incentive for the creditors since they have to pay a substantial amount to the collection agencies as fees. But if the accounts have been sold to the third-party collection agencies, then the accounts can’t be pulled back. In such a situation, you have to deal with the collection agencies only.
However, when the collection agencies contact you regarding the debts, you should ask them to validate the debt in writing within 5 days of initial communication. This will help you know whether the collectors are speaking the truth.
You should retain the records of your conversations with the collection agencies. Once it is confirmed that you really owe money to the collection agencies, you can settle the debts. But, after paying the settlement amounts, you’ll find that the accounts status have been updated as “Paid as Settled” on your credit report. This will hurt your credit score.
However, if you already have a poor credit score, then settlement will not hurt your score much. Make sure you have all the payment receipts with you.
Finally, after few months, you should order and check your credit report again. Check whether or not the account status has been reported correctly. If you find that the payment has not been reported, then you must dispute the item with the credit bureaus with your payment receipts. Credit bureaus will send you the corrected report after investigating the item.
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