Collections Issue with SBC: need advice!

[Suzanne]

Hi All,
A young nursing student at Sonoma State just called me with the following problem. I'm wondering if any of you can recommend an advocate a course of action... Thanks so much....

5 years ago she helped a guy sign up for a phone at his apartment but using herself as the person asking for service. All bills were mailed to his apartment in her name.
He racked up a $3,000.00 bill and skipped town (owes lots of folks in their town) and no one can find him.

ISSUE: She never heard about this until today when an SBC collection agency called her. The collection agency said SBC, then one previous collections agency had never been able to locate her. But they had her social security number and could have contacted her employer...but they never did.
Therefore, they are now saying she's liable for the 3,000.00 PLUS an additional $3,000.00 in interest charges for the last 5 years!

I don't think she should have to pay for their inability to contact her employer and that all she should pay is the $3,000.00 phone bill.

What do you think and what if anything can we do?
Also, they are demanding that she pay $1k a month! LOL
She has no money and is in school on scholarships.
Can we take them to small claims court? or how do we challenge the interest fees?

Any advice, counsel is welcome.
Thanks for your time and experience on this.

Cheers,
Suzanne

[hbruhner]

OK.

I am a mortgage broker and I see this all the time with some of my clients. Bottom line is that you START with the amount owed and don't ever offer to pay the interest or any other fees. The other part of it is that after 7 years, it drops off of the credit report all together so she could just wait.......

If I saw how it looked on her actual credit report, I would happily offer my advice at no charge. She can get a copy of her credit report online for free and then she can call or email me for advice. She should go to www.myfreecreditreport.com and then call me at 887-7950 or email me at [email protected]

Hans Bruhner

Hi All,
A young nursing student at Sonoma State just called me with the following problem. I'm wondering if any of you can recommend an advocate a course of action... Thanks so much....

5 years ago she helped a guy sign up for a phone at his apartment but using herself as the person asking for service. All bills were mailed to his apartment in her name.
He racked up a $3,000.00 bill and skipped town (owes lots of folks in their town) and no one can find him.

ISSUE: She never heard about this until today when an SBC collection agency called her. The collection agency said SBC, then one previous collections agency had never been able to locate her. But they had her social security number and could have contacted her employer...but they never did.
Therefore, they are now saying she's liable for the 3,000.00 PLUS an additional $3,000.00 in interest charges for the last 5 years!

I don't think she should have to pay for their inability to contact her employer and that all she should pay is the $3,000.00 phone bill.

What do you think and what if anything can we do?
Also, they are demanding that she pay $1k a month! LOL
She has no money and is in school on scholarships.
Can we take them to small claims court? or how do we challenge the interest fees?

Any advice, counsel is welcome.
Thanks for your time and experience on this.

Cheers,
Suzanne

[Braggi]

Can we take them to small claims court? or how do we challenge the interest fees?

You need help. Tomorrow you and your friend should listen to KGO radio 810 in San Francisco. In the morning consumer advocate Michael Finney has a show and he will help you if you can get through. The way to get through on the phone is to call BEFORE his show actually starts. A half hour early probably isn't too soon. Look on the website KGO.com to learn when his show starts. If that fails you, wait until late afternoon and listen to lawyer Len Tillem, also on KGO. One of these guys will help you but Finney is your best bet.

Good luck and let us know how it turns out.

Stay out of court! You will certainly lose.

-Jeff

[Suzanne]

Thank you Hans! This is excellent advice and how generous of you to help her. I've passed your information on to her.
Again..many thanks...
Wacco is Awesome!
Suzanne

OK.

I am a mortgage broker and I see this all the time with some of my clients. Bottom line is that you START with the amount owed and don't ever offer to pay the interest or any other fees. The other part of it is that after 7 years, it drops off of the credit report all together so she could just wait.......

If I saw how it looked on her actual credit report, I would happily offer my advice at no charge. She can get a copy of her credit report online for free and then she can call or email me for advice. She should go to www.myfreecreditreport.com and then call me at 887-7950 or email me at [email protected]

Hans Bruhner

[Suzanne]

Thank you Jeff! This is an excellent suggestion and I've passed this on to her.
I really appreciate WACCO, especially at a time like this. Thank you so much for broadening her options.
Suzanne

You need help. Tomorrow you and your friend should listen to KGO radio 810 in San Francisco. In the morning consumer advocate Michael Finney has a show and he will help you if you can get through. The way to get through on the phone is to call BEFORE his show actually starts. A half hour early probably isn't too soon. Look on the website KGO.com to learn when his show starts. If that fails you, wait until late afternoon and listen to lawyer Len Tillem, also on KGO. One of these guys will help you but Finney is your best bet.

Good luck and let us know how it turns out.

Stay out of court! You will certainly lose.

-Jeff

[tomcat]

Just remember,
If she makes ANY payments at all, it restarts the 7 year clock to get it off of her credit report. So the best bet may be to just wait a couple more years and it will drop off. If she has nothing, they can't get it from her anyway.
Tom S.

Thank you Jeff! This is an excellent suggestion and I've passed this on to her.
I really appreciate WACCO, especially at a time like this. Thank you so much for broadening her options.
Suzanne

[Suzanne]

Tom.. thank you! I had no idea that paying them might worsen her situation.
They told her if she paid the entire amount (which they offered to discount to $4,500.00) that it wouldn't hit her credit rating; but if she made monthly payments for the next couple years it would hurt her credit rating.
Ofcourse these folks have heavy accents and are located in India.
I have passed your info on to her.
Again... many thanks
Suzanne

Just remember,
If she makes ANY payments at all, it restarts the 7 year clock to get it off of her credit report. So the best bet may be to just wait a couple more years and it will drop off. If she has nothing, they can't get it from her anyway.
Tom S.

[hbruhner]

One last thing:

Tom points out an intyeresting fact that if she has any activity, the 7 years resets. Please not that once it drops off of the credit report, the debt does not go away. It simply can not affect your credit any more and the collector loses a lot if not all of their steam. Most of them will be gone forever but some keep trying.

Lastly, if you have an old collection (more than 2 years old) then it is not affecting your credit score too badly. The minute you make a payment on it, even if you pay it off completely, your credit score will go down because the computer model sees this as new activity on a collection account. If you have a 2 year old collection and it is for $100 and you don't want to wait 5 more years, then pay it off when you don't plan to seek new credit for 6 months to a year. Credit scores are not an exact science but I have seen this happen and after 6 months you are in about the same place as you were before you paid it and then the credit score improves every 6 months from there (generally speaking).

When I have a home buyer in this situation, most lenders will require that it be paid off to get the home loan so we have the borrower pay it off at the closing table and no sooner so that the credit score does not go down during the loan process but after the loan process.

Crazy but true.

Hans Bruhner

Tom.. thank you! I had no idea that paying them might worsen her situation.
They told her if she paid the entire amount (which they offered to discount to $4,500.00) that it wouldn't hit her credit rating; but if she made monthly payments for the next couple years it would hurt her credit rating.
Ofcourse these folks have heavy accents and are located in India.
I have passed your info on to her.
Again... many thanks
Suzanne