Posted on
January 23, 2010
at
11:34 pm
Myth 1. Medical debts don't go on the credit report.This is by far the biggest myth when it comes to having debt. When or where this myth originated I don't know, but I assure you that this is not true.There are a lot of hospitals that don't report to the credit report. Typically if the hospital is based in a city that has a university in it they won't report because they don't want to ruin students' credit who can't afford to pay their medical debts. This is not always the case though. If you're not sure whether or not the hospital uses a collection agency that reports to the credit bureau just call the collection agency that handles the debt and if they actually do report your particular debt to the credit report they will be more than happy to let you know. (The ability to report your debt to the credit report gives the collection agency more leverage to collect the debt, so they WILL tell you.)It is imperative that you ask the collection agency not the hospital....let me explain why.If you go to the hospital you are going to have separate bills from each section of the hospital that you go to. With that in mind different parts of the hospital may not even use a collection agency or use ones that don't report to the credit report while at the same time another section of the hospital you went to actually use a collection agency that reports your bill to the credit report.If you have a medical debt that is from a doctor's office that is not associates with a hospital about 90% of them are going to report to the credit report and most will have a judgment filed against you, if they can, if your bill is not paid in a timely fashion.*A positive though with a doctor's office over the hospital to find out if your bill is going to be on your credit if not paid you can just call and ask them because their medical billing procedures won't differentiate because it's all on the same bill.
Myth 2. If you pay a bill it will come off your credit.No! This is most likely the exact opposite of what is going to happen. A lot of people will pay a bill to get it removed from their credit in hopes that it will raise their credit score. This will not work the way you think. Let me explain...under the Fair Credit Reporting Act a collection agency is not allowed to report inaccurate information to your credit report. That being said, say you have a bill that has been in collections for a year that reports to the credit report. If you call them and pay the bill off it's not going to come off your credit report. The reason why is that if the agency removes this from your credit report that is stating that it was never supposed to be on your credit report in the first place, which is inaccurate information and is against federal law to do so. Let me make this clear the only reasons that something will be removed from your credit are.1. If the debt is fraudulent.2. If the debt can't be validated.3. If the debt was paid before it was sent to the agency reporting it.THAT'S IT!*Normal debts will come off your credit report after 7 years from the
last payment that was made on the bill. (If you have a bill that has been on your credit report for 6 years and 364 days and you pay it you will have to wait another 7 full years before it comes off.)**Some of the less professional agencies out there will remove debts despite being against federal regulations. Here's the reason why. For the collection agency to actually get in trouble for doing this you have to prove beyond a reasonable doubt this was done intentionally. (This is nearly impossible to do.)
Myth 3. If I ask for a bill they have to send me oneThis is not true! In my years of debt collection out of all the excuses either valid or invalid, this is the most used. "I didn't get a bill; I need you to send me a bill." Debt collectors call this stalling. Let me explain. Fair Debt Collection Practices Act requires every collection agency to send what is called a first collection notice and all that is required is that it is sent to the "Last Known Address" whether you actually receive the mail doesn't matter at all. (In short,
don't call a collection agency asking for a bill because the odds are that they won't send it and most likely will just make the collector you speak with mad because they will take it as stalling and will most likely proceed with further action on your account if they can.)You are by law entitled to a bill, but just because you ask for one doesn't mean that you are going to get it. To ensure you do get a bill send a request to the collection agency
IN WRITING. If you send this
in writing by federal law the collection agency
will have to send you a bill.
Myth 4. If I tell a debt collector not to call anymore then they can't call anymore.Wrong! If you tell a debt collector they can't call you anymore what will most likely happen is that they will call you more often. There is nothing in the Fair Debt Collection Practices Act that says that a debt collector must stop calling you if you ask them to. (The one exception to this is at work see myth 5 about calling work and cell phones.)However, luckily enough for you is that the Fair Debt Collection Practices Act does require them to stop calling you if you send them
in writing what is called a "cease and desist" letter. *If you have an attorney representing you, you will need to get them all of your attorneys correct contact information and they will have to direct all communications to your attorney. Written is still better as always.
Myth 5. Debt collectors can't call my work or my cell phone.Wrong! First, I'll explain calling your work. Unless your company has a policy against personal calls at work or you have specifically asked them not to call you at work they can call you there. Even if you ask them not to call or your company has a policy they are still allowed to call your work. But now that the debt collector knows they can't make a personal call to your work so they can't try to collect a debt. The only reason they are allowed to call is for business purposes not to collect a debt so if they want to verify your employment in regards to a wage garnishment they are still allowed to do that.Let's move on to cell phones. Whether a collection agency can call your cell phone is based on how they acquire your cell phone number. Let me explain. If you tell a debt collector not to call your cell phone they will continue to call it. Unless they acquired your number in another way then from the client they got the debt from (who you originally owed). So if a family member gives them your cell phone number they are "supposed" to stop calling it. The problem with this is that there is no real way to prove that they didn't get it from their client unless you just got the number so they are probably going to continue to call it. You can send them a "cease and desist" letter and by federal law they will not be able to contact you on your cell phone or any other number.
