Bizarre Debt Collection

[tinapbeana]

I got something in the mail this week I've never heard of before, so I thought I'd share it here.

Background: apparently I have a debt with Wachovia from 2001. Long story short, I was much younger, naive, and trusting and found out about the debt after the fact. The debt is old enough that at this point the 3 year time period specified by my state has expired and I'm pretty sure I can have the item removed and all collections stopped via a 'cease and desist' (SC Code SECTION 15-3-530, 535)

Anyways, I get a letter in the mail this week marked 'Visa'. I always open these so I know if I need to shred or burn it. Turns out this letter marked 'Visa' is from Resurgent Capital and they have an "amazing offer" just for me.

Right.

They've partnered with Wachovia, and the deal they're offering me is this:

1. I owe Wachovia $553
2. Resurgent is offering me a 'Visa' with a $490 limit. This card will be instantly maxed out with my Wachovia debt
3. Resurgent will kindly 'forgive' me the remaining $63 in debt to Wachovia
4. All I have to do is make minimum monthly payments like on any credit card

Here are the catches:

1. Accepting this offer resets the collections and reporting clock
2. Accepting this offer allows them to collect a debt which, according to legislation in my state, is no longer collectible
3. The 'new' balance on my credit card would be subject to an 18.99% interest rate
4. defaulting on the card would reinstate my balance with Wachovia under the new 'clock' and leave me owing fees and interest to Resurgent.

This is the first time I've ever heard of this kind of 'offer', and it ticked me right off. What about you all, has anyone ever heard of such a thing?

[vsjhoc]

Re: Bizarre Debt Collection

Tina - You mean you didn't jump at the chance to accept this wonderful offer??? This is really sleazy. I'd ignore it.

If (I didn't check) the Statute of Limitations in SC for this type of contract is 3 years, it means that if they now sue you for the debt, you'd have the defense that they are time-barred -- meaning they waited too long and they are SOL. You win.

This is a different issue from inclusion of the debt in your credit reports. The trade line will fall off your credit reports 7.5 years after your date of first delinquency, which is when you stopped paying. So if your last payment was in Jan 2001, you missed the Feb 2001 payment and never paid again, this old debt should drop off your credit reports in August 2008.

[PRICEPLUS]

Re: Bizarre Debt Collection

vsjhoc speaks sense. I would ignore the invite.

[tinapbeana]

Re: Bizarre Debt Collection

oh, there's no chance of me taking the offer. DH's ears perked right up when he read the paper, though, so i had to spend some time explaining why it was junk...

[mom-from-missouri]

Re: Bizarre Debt Collection

My question is (from the parent in me), if it is your debt, why should you not pay it? people who don't pay them make the interest rates go up for everyone else?

[Aleta]

Re: Bizarre Debt Collection

Make sure that you check this completely Tina. We received one also from the same company saying that we owed $567. to JC Penny. We called JC Penny to tell them of the letter and we had them check out the claim and the amount. They didn't know anything about it. We hadn't charged anything to a card with them. The person I spoke with said it sounded like a collection agency with a new way of collecting. I was told to ignor it.

They changed the bankruptcy laws recently and the loan sharks are out in a frenzy to collect from everyone. The way they give young people cards without any other signature should be against the law. Check into it first.

[tinapbeana]

Re: Bizarre Debt Collection

My question is (from the parent in me), if it is your debt, why should you not pay it? people who don't pay them make the interest rates go up for everyone else?

i'm not saying i shouldn't pay it. i'm saying it should be paid to the original company, not some off-the-wall company who's trying to rope me into a new credit card that already maxed out with an old debt earning new interest.

[cornflakesdisease]

Re: Bizarre Debt Collection

Be very very careful with debt collctor these days. In New York, a large debt collecting agency was just charged with fruad on multiple counts by going after people who owed NOTHING. Thats right. It's happening a lot. They figure people will pay for fear of their credit being messed up.

A co-working just got a letter from a home repair company for the same reason. He had never done business with them. But if 1 person out a 100 pays they make money.