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  1. #1
    Join Date
    Oct 2009
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    Default Collection of Debts With Incomplete Records

    My question involves collection proceedings in the State of: Texas

    Junk debt collectors are taking advantage of the difficulty in preserving complete copies of the historical record by both the original lendor and the credit card holder. The original lendor may no longer even exist and the only records that have been passed through a successor of purchasers is a computer printout showing a few significant account action dates and an amount.

    Junk debt is often decades old and was thought by all parties at the time to have been resolved through the means available at the time. The lendor wrote the debt off and put a hit on the debtor's credit record. The presumption was that the statute of limitations would then expire and that was that. It was not understood at the time that junk debt could be collected upon in the way that we currently experience it.

    It is difficult to maintain records for decades on matters that are thought to have been resolved. Records get lost in moves, damaged when water pipes leak, etc. Documents that would clearly establish lack of liability or the date of expiration of the statute of limitation are lost. The junk debt buyers position themselves to take advantage of that inevitability.

    Assume for the purpose of this question that the records establishing either no liability or that the statue of limitations has expired are necessary to establish that lack of liability or to show that the statute of limitations has expired.

    Does the law make any provision for the difficulty involved in maintaining records in perpetutity? Are there any established legal arguments that one may assert in court when confronted with decades old debt and no records that remain other than that printout the debt collector is using?

  2. #2
    Join Date
    Jan 2008
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    Toledo, OH
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    Default Re: Historical Records of Ancient Debt

    Under the Fair Debt Collection Practices Act, that printout that the collector has is about as valid as used toilet paper.

    After receiving your dispute, the collection agency must send you proof that it owns or has been assigned the debt by the original creditor. Verification that you owe the debt and the amount of the debt needs to include documentation from original creditor (however, it is the debt collector who sends it to you). It is not enough for the collection agency to simply send you a printout of the amount owed.

    If the debt collector does not verify the debt within 30 days, it is not allowed to continue collecting the debt from you nor can it list the debt on your credit report. Should the debt collector list the debt on your credit report, you can dispute the debt with the credit bureau. Sending the credit bureau a copy of your debt validation letter along with the certified and return receipts will help get the account removed from your credit report.


    http://credit.about.com/od/debtcolle...validation.htm

    What does a debt collector need to provide as debt validation?

    * Proof that the collection company owns the debt/or has been assigned the debt. (Bob is legally entitled to collect this particular debt from you.) This is basic contract law. It is very difficult to get a judgment without a direct contract between collection agency and the original creditor.

    * At a minimum, some account statements from the original creditor. If you really want to get sticky, you can pin them down on the amount of the debt by requiring complete payment history, starting with the original creditor. (How the heck did Bob calculate this debt? What fees/interest Bob has tacked on to this debt and how he determined these fees?) This requirement was established by the case Fields v. Wilber Law Firm, Donald L. Wilber and Kenneth Wilber, USCA-02-C-0072, 7th Circuit Court, Sept 2004..

    * Copy of the original signed loan agreement or credit card application. (Your contract with Joe establishing the debt between you.) However, account statements from the original can fulfill these requirements.

    http://www.creditinfocenter.com/rebu...lidation.shtml

  3. #3
    Join Date
    Oct 2009
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    18

    Default Re: Historical Records of Ancient Debt

    Thank you. If I'm understanding the substance of your reply, since the junk debt collector can be required to fully validate the debt with documentation, that validation would carry over into court if I am sued. In court, they must still validate the debt with more specificity than just waving a computer printout and demanding I refute it. The burden if first on them to establish the debt.

  4. #4
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    Toledo, OH
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    Default Re: Historical Records of Ancient Debt

    Yes, you're understanding correctly.

  5. #5
    Join Date
    Oct 2009
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    Default Re: Historical Records of Ancient Debt

    Though it is from another State than Texas, I found this case where incomplete records appear no particular problem to overcome for the debt collector, in fact, they were able to obtain summary judgement. This does not bode well.

    http://www.in.gov/judiciary/opinions...3310904ghs.pdf

  6. #6

    Default Re: Historical Records of Ancient Debt

    But, the original creditor submitted a year's worth of statements and an agreement which stated that use of the card is acceptance of the agreement. The OC also submitted an affidavit from a person of knowledge of the account attesting to the records of the delinquent debt.

    Pretty strong evidence.

    If you are dealing with a JDB then they will not likely be able to come up the year's worth of statements nor an affidavit from the OC.

    You must first find out who the collector is that may be suing. Is it the original lender or has it sold the debt to someone else?

  7. #7
    Join Date
    Oct 2009
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    18

    Default Re: Historical Records of Ancient Debt

    The original lendor has been out of business for many years. Their operations were absorbed by another lendor who in turn sold the debt to a junk debt buyer.

    Sorry for the delay in responding, virus ate my computer and it took a little while to get back...

  8. #8
    Join Date
    Mar 2009
    Posts
    20

    Default Re: Historical Records of Ancient Debt

    In my case the CA provided an unbroken chain of succession. They provided the court with an affidavit from some one in another state that claims she has the ability to testify the correctness of the records. ( When in fact she could not testify truthfully to squat )

    If they have not provided an unbroken chain of succession. I would state it in an answer.
    However you may have to research the law on that in your State. It may be grounds for dismissal.


    However you will probably be defending against a summary disposition if you never disputed the debt. That defense and the ability to provide a valid defense with proper case law
    is the key to a favorable settlement.

  9. #9
    Join Date
    Oct 2009
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    18

    Default Re: Historical Records of Ancient Debt

    By way of providing continuity, just wanted to update this thread to report that over four years have passed without any further contact by the junk debt buyer. As best I can tell from what little information was given originally, the statute of limitations on the alleged payment that restarted it would have expired several years ago so I guess what we have to hope is that no one pays a penny on it again in the future thereby restarting the statute of limitations clock again.

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