One day a collections letter appears. Then another, more aggressive collections letter appears. All of this followed by phone calls, some warning you about bad credit reports and potential legal action.

Creditors will hire collection agencies to retrieve debt. Often these third-party companies will work for commission. Because of this, collectors are more likely to go after the money more vigorously. It is important to know your rights.

Collection agencies do have the right to report your debt to credit bureaus. Paying off the debt will not result in it being removed from your credit reports, it will be marked off as \”paid.\” They also can request a debtors credit report to analyze the person\’s financial situation, or to get an updated address and phone number. And, although collection agencies do not like to send many accounts back, sometimes they will refer their account back to the creditor and recommend filing a law suit.

There are rules and regulations by which collection agencies must abide. Letters should come in ambiguous envelops that do not reveal that any type of debt is owed. In terms of phone calls, a collector may not disclose the reason for the call. For example, if a collector reaches an answering machine, they cannot divulge why they are calling, all they can do is leave their name and a number where they can be reached.

Although collection agencies are permitted to contact the debtor\’s at their place of employment, they definitely cannot attempt to get a debtor dismissed from their job. No kind of information concerning the debt may be made public, although collection agencies can communicate openly with credit bureaus. Even though many people believe that a collection agency could legally seize a debtor\’s bank account, paycheck and assets, the company cannot unless their has been a successful law suit ordering them to do so. Under no circumstances can a collection agency threaten a debtor with violence.

Even though some collections companies attempt to practice illegal strategies to get money, there are also a large number of reputable ones. With financial issues like debt, it is always crucial that you know your rights.

Mallory McGuinness-Hickey does freelance writing for debt collection agency Rapid Recovery Solution . For more information contact seo@rapidrecoverysolutions or simply click on the hyper link.

Learn How to Challenge Your Equifax Credit Report

Are you tired of the bad credit reported on your credit report?

To begin with, you will need to request a copy of your Equifax credit report so you can review its contents for negative and inaccurate entries. Entries that damage your credit include:

third party actions involving charge-offs

judgments

bankruptcy proceedings, such as Chapter 7 or Chapter 13

home foreclosures

repossessions – auto, boat, or other property

payroll garnishment

payment inconsistencies

collections, paid collections, settled accounts

public records/judgments

Your second step is to write an Equifax dispute letter. You will need to include your personal information and reason for the dispute. In other words, you need to say why you believe the information is inaccurate.

The final step is to wait 30-45 days for the results.

What Happens After I Mail my Dispute Letter?

If your dispute is successful, continue the process to attempt to remove all negative entries from your credit report. Once this step is completed, clear up any remaining issues, such as discrepancies involving personal information.

If your dispute is successful, the negative item in question will be removed by Equifax. At times, a credit bureau will revise items on your credit report after they have been contacted by your creditors. This information can be good or bad, depending upon the creditors’ reports. For instance, your credit report might be revised to show that an account went to collection.

If you lose your Equifax dispute, the negative items will stay on your report possibly for the next 7-10 years. If this happens, you still have some options to continue the credit repair process.

At times, a simple dispute is not effective and more advanced methods are necessary. At this point, it is wise to seek the advice of a legal professional who can employ methods such as payment for deletion, debt validation, or possibly even negotiating directly with the creditor.

Keep in mind that credit reporting by a creditor is voluntary, while the seven year limit is imposed only on credit bureaus. As such, a convincing attorney can often persuade a creditor to erase a negative item from your credit report.

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