ruggedmaker2 said:Some people just don't get that you actually *have* to let the creditor know the debt is settled. They don't even bother reading the fine print on the notices they receive....
Sadly, that's just how it goes.
From what I've seen in the real world, once you pay up, you need to notify every living soul and inanimate object 😁 that the money moved. Most creditors won't even bother telling the collections department that, say, you paid yesterday, so the whole machine keeps grinding away at your bank account through some agency like the Treasury.
Sure, the creditor sees the money hit their account, but the real question is who actually looks at it and which department tells whom. In these massive corporations, departments act like they live on different planets. Accounting sees the payment and logs it, but they never bother telling the legal team that started all the warnings and garnishments. So then you end up getting sued for something you already paid... yeah, happens all the time. It's a mess.
Then you've got courts "losing" proof of payment—even when you have the signed receipts proving they received them. And don't even get me started on how easy it is for someone else to overlook or forget a crucial detail.
Just to be safe, you should notify everyone and everything 😁 and hoard those documents like they're gold for a million years.
That’s why people keep copies of receipts for at least 10 years... on December 31, 2013, I’m tossing everything paid before January 1, 2003—so I’m holding onto 11 years of valid receipts... it's a massive pile. Nowadays, since I use online banking, I always pull an e-statement and attach it to my records... so now it's an even bigger pile... maybe I'll get hit with a garnishment eventually.
Technically, there's no need to notify anyone except the creditor, provided you file a formal dispute.
Otherwise, LegalZoom is one of those sites where you can roughly draft a dispute for free, though you have to register and provide your Social Security number.
Anyway, that's not the point. There's a more important thing I want to cover. I didn't want to bring it up before, but since the media is already running a shallow version of this story, there's no sense in keeping it to myself.
Basically, I mentioned a while ago that people can actually rid themselves of collections quite easily, but I hesitated because the methods involved could be considered a serious abuse of the legal system.
This is about fighting collections that are in the thousands of dollars (we aren't counting small change here).
First off, this whole approach requires someone you trust implicitly. Without that, nothing works. Second, this won't work if a collection action has already been officially filed.
Let's get to it. You get a notice for an amount >$16667 and you know you'll never be able to pay it. What do you do? Filing a formal dispute is the first step to neutralizing the collection. That buys you at least a year or a year and a half. Second, you open a protected bank account at a local FIFA branch. Third, you sort out ownership of your belongings and property. If you have minor children, it's best to transfer assets to them—provided they aren't addicts... 😉 Basically, transfer all real estate and assets to someone you trust. If you're married, a divorce becomes inevitable and necessary. If you have kids, you'll naturally agree to set child support at the maximum allowable rate. The goal is to reach a state where you practically own nothing—not even the clothes on your back—so any creditor trying to collect finds absolutely nothing to grab.
And here’s the most important part:
The moment you file an objection, you sign a loan agreement with a default clause involving someone you trust—let's say $100000 (believe me, there are plenty of people out there, and you can set this up right at the same notary where you filed your objection... they won't mind the extra income) with an 8-day repayment window and an 8.99% annual interest rate, just to be aggressive. 😉
Once those 8 days pass, your trusted person files a judgment against you for $100000 against your cash assets using a valid legal instrument 😉. Naturally, when that judgment hits your mailbox, you simply file an objection to it as well. It becomes legally binding, and you can head straight to the bank to freeze your own account.
After that, any other collections hitting you will just sit behind yours. Since your debt is practically uncollectible thanks to our "fair and just" laws, none of those subsequent collectors will be able to touch anything.
But... if you want to be truly ruthless, don't send the judgment for collection immediately...
People on forums have mentioned assumption of debt agreements... you could simply sign a contract taking responsibility for all debts owed by other individuals, provided you don't cause them harm (be careful with this one and do your homework, because for example, if you assume responsibility for utility bills, companies like ConEd might shut off the power after three missed payments)
Actually, you don't even need to research that. Just take out a personal loan for the maximum amount possible (roughly $67), withdraw the cash, and hide it under a mattress or give it to your trusted person to put in a high-yield savings account...
Only then do you trigger the judgment... as for the bank... whatever, let them try to collect. 🙂
The fallout: You'll never be able to use credit cards again... and of course, if this trusted person is your life partner (which is usually the case), you'll have to treat them like royalty for the rest of your life... because everything you own now belongs to them, while they spend a third of your income pampering you... 😉
The catch? The abuse of rights lies in the fact that you signed a sham loan agreement with no actual money changing hands... so yes, expect some lawsuits. But the prosecutor would have to prove the contract was fake, which is incredibly difficult to prove.