Question:
I need help in dealing with a nasty collection agency for American
Express. I want to settle my debt but they refuse to negotiate a
lower settlement payment. Is it my right to know if the agency bought
my account or is just working for American Express to collect the debt
for them? I do not want that agency profiting on my hardship if they
bought the account for less than value while harassing me for the
entire balance. In other words, for example, if they bought it for
50% of the balance originally owed to American Express, then I would
think a fair settlement would be 75%. Still a nice profit for them.
Don’t get me wrong, I am not denying that I owed American
Express the entire debt but at this point I do not think that this
collection agency morally “deserves” the entire debt,
legally or otherwise, especially after harassing me and getting into
my personal business.
Answer:
Either way you technically still owe the whole sum, and it is not
improper for your creditor to try to recover the whole sum. The fact
that they acquired your debt for less than 100% of its value is of
little significance, and in any case Amex's out of pocket cost when it
lent you the money was much less than 50%.
In my case, I don't know if they were willing to eventually settle for
less than the whole sum because I filed for Chapter 7, which pretty
much put an end to the negotiations.
If you are thinking of filing for bankruptcy, go ahead and hire a
lawyer and tell them to call your lawyer from now on. That will shut
those jerks up real fast. (You don't necessarily have to file for
bankruptcy after hiring the lawyer.) You might also be able to enter
a debt-counseling program, in which case you.
