Expert: Christine Janklow - 6/4/2009

Question
QUESTION: I got myself into a very hard situation. The company I
worked for is closed now, and the owner has no money to pay
the debt on the card. This card was open in the name of the
company and my name on it. Now AmEx say that I'm personally
liable for the debt. When I opened it I had no idea I
signed any guarantee. The owner was added as an authorized
user and all transactions are listed under his card, I
haven't ever used the account. Now the collection agency
calls me and wants to collect. What are my options? How can
they collect debt from me? The lady said that I should seek
attorney's help. What will collection agency try to do? Can
they force me to pay? Thank you.

ANSWER: Dear Tania:
Thank you for your inquiry. I regret that you find yourself in such a situation. There are a couple of things you can and should do to gather the information you will need to decide on a resolution. First you need to write a validation of debt letter to the collection agency. Also send Amex a copy. If you can run a credit report see www.annualcreditreport.com on yourself to see if this shows up as a liability of yours personally, than you can assume they got your social security number from some personal guarantee you signed. If you don't see it, you have a stronger case to dispute the claim. Furthermore, as you were not an officer or owner of the company and it is now insolvent, you need to identify that to your creditor in writing. There is a statute of limitations in your state on collecting debts so this may even be nearing the end of that statute and they are attempting to collect from whomever has use of these accounts (any payments made renew the statue)visit www.fair-debt-collection.com for more about this. If you can't verify the account is yours, you might want to seek legal counsel to advise you on your rights. Collections agencies cant sue you, but they often bother you with phone calls and letters. You need to visit www.ftc.gov and learn more about the dos and don'ts' regarding Fair Debt Collections Practices Act.If the creditor assigns this to a lawfirm in your state they will likely sue you if they believe it to be your responsibility.

Respectfully,
Christine Janklow

---------- FOLLOW-UP ----------

QUESTION: Thank you, Christine. I will start researching more. I know
for sure that this account has never appeared on my credit
report because I check it at least annually. I just ran it
now, and this account is not there. However, they claim
they can put it on my history, is that correct, can they do
it?

Answer
Again, much of what is said is done so in an effort to "threaten" you into paying, or facing a "mark" on your score. Credit is repairable and if it does report it will also add the balance owed to your current debts, regardless of the status. If you are not responsible, stick to the story, because this may not truly be your debt to pay. You might be in for a fight, but worth it if you are in the right. If they report to the agencies, contact them to dispute or you can hire a licensed credit repair agency to do so on your behalf.