Credit and Debit Cards
Debt Collection
Banking

Do you have to pay a debt if another lender has purchased the account?

303132

Top Answer
User Avatar
Wiki User
2005-09-09 12:47:13
2005-09-09 12:47:13

Paying the debt depends upon the circumstances of the debtor. Common sense would dictate that the majority of people would pay their debts if they were able. When a debt is sold by the original creditor to a third party, the debt remains valid and all the terms of the original agreement apply until the account is paid or settled, either voluntarily or by legal remedies. The party that purchased the account will generally offer a settlement for less than the entire amount of the debt or a payment plan. Be very cautious in making any such agreements, the interest rates for a payment agreement can be as much as 30% depending on state usury laws.

1
๐Ÿ™
0
๐Ÿคจ
0
๐Ÿ˜ฎ
0
๐Ÿ˜‚
0

Related Questions

User Avatar

YES, they purchased a debt contract. The original creditor does not forgive / eliminate a debt by selling it to a collector -- they simply gave-up on collecting a worthwhile settlement from you.

User Avatar

Yes, the debt still stands. It's how debt collectors stay in busniess. When the debt or account is sold, the debt isn't erased, merely transferred. In essence, the original lender has sold the whole contract. * The debtor makes any payment agreement with the collector not the original creditor.

User Avatar

Yes, it is a common practice especially when it relates to credit card debt.

User Avatar

No, ih he sold it he no longer has any right to it. But frequently, they just hire or assign the right to collect it to another, in which case the debt is still owed to them.

User Avatar

Yes, there is no law that says a debtor needs to be notified of any debt being charged off by the lender. The term simply refers to the original lender moving a debt from an open account to inside or outside collections. The debt remains valid and collectible.

User Avatar

If the lender designates the account as a charge off, the account is still valid and will be referred to inside collections department or an outside collector for further action. If the lender cancels the debt, the debt is no longer valid and the debtor will receive a 1099-C showing the amount that the borrower must claim on his or her tax return as taxable income.

User Avatar

When a customer's loan or bill goes into default the company that lent the debtor the money will try to collect the debt. Most debt collectors are from the actual lender or are contractors that have purchased the debt and will try to collect the money from the debtor with interest.

User Avatar

Yes, the lender/creditor can sue the debtor in the state court in the county where the debtor resides for the debt owed regardless of where that debt was incurred. In some cases, the lender/creditor can send the defaulted account to the National Board of Arbitration bypassing the usual court procedure of a lawsuit. The debtor will be notified in advance of any litigation the lender/creditor chooses to take.

User Avatar

This is a misnomer. When an account is sent to debt collections, the collection agency does not typically own it. They are simply acting on the part of the lender or creditor. When judgment is sought on a bad debt, it is the lender who is suing. They are perhaps doing so through the collection agency and the lawyer they have under contract, but it is not the collection agency who is suing.

User Avatar

The creditor is the lender. The bankrupt is the debtor. The lender never has to re-affirm he wants to get paid back.

User Avatar

Yes. You've moved the debt from one account to another, so the first account would recognize the transfer as a payment and the second account would treat it as a new debt.

User Avatar

There is no set time for a creditor/lender to cancell a debt. Charge offs are generally done 180 days after the account becomes delinquent. A Charge off does not mean the debt is not still owed and collectible.

User Avatar

You list the creditor or collector of the last notice your received. For example if you received a collection notice from an agency for a debt from Capital One you list it in that form. XXX agency for Capital One acct.

User Avatar

Depends on which USA state where you live - Check Debt with Statute of Limitations; and http://www.bcsalliance.com/y_debt_sol.html

User Avatar

That is up to your lender and whether it thinks you can take on more debt.

User Avatar

In most cases there is none. Charge off and written off are terms that indicate the debt is being removed from normal account action and sent to collections. Only when a debt is "forgiven" by the original lender or collector is it considered no longer collectible.

User Avatar

Collection agencies are usually retained by the establishment that you owe the defaulted debt to, if the borrower ( person in debt) does not want to work with the collection agency handling their debt, the collection agency will then document the account as a refusal then send the account back to the original lender then they will garnish your wages until the life of the loan is paid off.

User Avatar

No. The state SOL begins approximately 6 months after the debt is defaulted upon. (Usually the last activity on the account). If any money is paid on the account, the debt is considered to be reaffirmed.

User Avatar

The date that is of the most importance is the DLA, which is used if it pertains to the state SOL. The opening account date can be disputed and possibly amended, but it will not affect the validity of the debt or prohibit the collection process.

User Avatar

The main difference between the two is that when a account being. Debt services means they consolidate your debt and debt repayment means they are asking for repayment through money. You should go for debt services to get out of debt. The meaning of this is that the debt consolidator will get in touch with all your lenders, "pay off" the balances on your behalf and subsequent to this instead of two or more credits, you only be indebted to one lender!

User Avatar

The student's estate is responsible for paying their debt unless there was a co-signer. If there is no estate the lender is out of luck. If there was a co-signer the lender will seek payment from that party.

User Avatar

In some cases yes. If the vehicle was purchased using the same lender against whom you have defaulted with a different loan, and there is a remaining balance after the repossession of that property, then the court can order a Conversion of Collateral, and the paid off vehicle can be repossessed by that lender. Additionally, if the court chooses, real property can be ordered liquidated to pay a bad debt.

User Avatar

usually this is because the original lender sold the account to a new lender which takes on the loan/debt, but the paper trail is still left on a persons credit report. If a company goes out of business they also liquidate their assets/accounts to another creditor. It also can be because the person did not pay on the account and it was sold to another creditor or a collection company. The most rare case would be that there is a mistake on a persons credit file and should contact the credit report company.

User Avatar

Bank accounts can only be "frozen" by a court order. A lender can request a court to take such action if it can be proven that the debt has plans to remove the funds from such accounts. Bank accounts can also be 'frozen' when they are jointly held so the non debtor account holder can provide documents to the court showing the portion of the funds in the account that belong to them and are exempt from a judgment creditor.


Copyright ยฉ 2020 Multiply Media, LLC. All Rights Reserved. The material on this site can not be reproduced, distributed, transmitted, cached or otherwise used, except with prior written permission of Multiply.