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Wolpoff & Abramson and Debt Collection Laws
Question: I have received a letter to sue from Wolpoff & Abramsom on my debt! HELP. It is regarding a credit card debt charged off in 12/2004. I made a last payment in March 2005. Can they sue me? Or is the debt too old already? I live in Texas.
Answer: First of all, for your information Wolpoff & Abramson is a collections law firm that uses legal collectionmethods (including arbitration and also lawsuits) to try to collect on the behalf of their creditor clients. They represent creditors just like a traditional collections agency, but they are a law firm that is licensed in many states and has the ability to legally collect on delinquent accounts.
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In your particular case, the statute of limitations in Texas for filing suit to collect on a delinquent credit card debt is four years from the date of last activity (i.e., the date you last made a payment on the account).
Therefore, if you made your last payment on the credit card account in March 2005, you are likely still within the four year statute of limitations, which means that the creditor may be able to file a suit against you for the collection of this debt.
Since the creditor is probably still in a legal position to sue you for this debt, you should not put it out of your mind until the four year statute of limitations has passed. In your position, I would encourage you to contact the collection agency handling the account to attempt to negotiate a settlement of the debt. If you can raise a lump sum to offer the creditor, say 40% of the balance owed, the creditor
may be willing to settle this account for much less than you actually owe.
It is also important to be aware that "Filing" a lawsuit is only half the battle (or materially less). A judgement simply means that the court has determined that you do owe the debt in question... but then the creditor must "enforce" the judgement with a garnishment, levy, or lien. In Texas (also known as 'debtor's heaven' because of the consumer protection laws) most traditional creditors have a hard time enforcing the judgement and collecting. See this site for state by state consumer protection and collection laws: http://www.bills.com/collection-laws/
So, you may wish to sit on this debt for the next year or so until the statute of limitations expires. You should keep in mind that the passage of the SOL does not forbid a creditor from calling you to collect on the debt; it simply provides you an absolute defense in court if the creditor files suit. You can generally stop collection calls by sending a cease and desist letter to the creditor–for more information about sending cease and desist letters, you can click on visit sample letter .
You must remember that your state’s SOL has little to do with how long accounts can appear on your credit report. The
length of time credit accounts can appear on your credit report is governed by federal law, specifically the Fair Credit Reporting Act. Generally speaking, negative listings will appear your credit report for seven years, while bankruptcies will appear for ten. So if your state’s SOL is four years, an account can appear on your credit report for three years after your state’s SOL has passed. A new company purchasing your account cannot lengthen the time that the account can appear on your credit report.
Be careful, though, because many debt purchasers try to change the date of last activity on old accounts so they appear on your credit report for a longer time. You need to pull your credit report and carefully review the account in question to make sure that no unauthorized changes have been made. If you find any suspicious information on your credit report, you should dispute the listings with the credit bureaus. The Federal Trade Commission offers a helpful guide to dispute credit listings. To find out more about credit, credit scoring, and credit reports, I encourage you to visit the Bills.com Credit Resources page .
I hope the information I have provided will help you Find. Learn. Save.
Best,
Bill
www.bills.com/blog
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1. Posted by Nicole Chapman on Wednesday 14th May 2008 06:51
Hello! I live in Colorado and per your website the SOL is 3 years. I entered 3 credit cards into a debt settlement program in mid 2003, 2 of which were unsatisfactorily settled but settled nontheless. The 3rd was placed with Wolpoff & Abramson by MBNA. The debt settlement company FINALLY negotiated a settlement but it is alot more money that I have. Since the SOL has passed, I am contemplating not accepting Wolpff's offer which means that the debt would remain on my credit report as a charge off until early 2010. Do you think this is a bad decision? Any other advice you might have would be hepful as I feel lost as a consumer.
2. Posted by Bill on Wednesday 14th May 2008 10:25
Statute of limitations is calculated from the time that you made the last payment on the account. If you have confirmed that the SOL has passed, then I agree with you in not paying the amount. Be aware though that even though the statute may have passed, that does not stop the creditor from pursuing collection efforts. It only means that if in case the creditor follows up by suing you in court you have a safe defense because of the SOL being passed.