Important facts regarding debts placed with credit and collection service companies in Indiana
February 1st, 2016 by New World Collections
When it comes to recovering debt for your business, there are 2 important facts regarding those debts you should be aware of when placing them with credit and collection service companies in Indiana. These facts are guidelines that must follow when attempting to recover debts on your behalf.
Do I owe a debt forever or is there a statute of limitations on a debt?
Generally speaking, consumers are only responsible for debts up to 7 years from the time the debt was created with the original creditor. This can vary based on certain factors from state to state. So in other words, debts 7 years or older are generally no longer allowed to be pursued for collection.
Do I have a right to ask for proof I owe the debt?
Consumers have the right to account validation for any debt placed into collections. What this means is the consumer can request to see proof of the debt, for which the credit and collection service companies must provide documents to prove they legally have the debt as well as showing what the debt is for and the date of charge or services rendered.
How Long Does it Take for a Company to Send You to Collections?
Under federal law, an original creditor can send your account to a collection agency once it’s 31 days past due. At that point, practices vary. Some creditors may continue to try to collect the debt for up to 180 days using in-house people before sending the account to a collection agency. Other creditors may send your account to collections as soon as it is eligible.
Can a Collection Agency Report to the Credit Bureaus if You Are Making Payments?
Yes, a collection agency can report to the credit bureaus even if you are making payments. Once your debt is transferred from the original creditor to the collection agency, the debt gets a new tradeline on your credit report that’s under the control of the collection agency. Payments made are reflected through this new entry.
These facts are important to consider regarding debts you place with credit and collection service companies in Indiana and the legal rights that protect the consumer in attempts to collect those debts.
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