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About Regan Shinski
Expertise
I can answer questions on collections, repossessions, bankruptcy, credit repair, credit counseling, FICO scores, credit planning, and the cause and effect of credit related decisions. I can also answer questions on collection settlements and preparing to sue your creditors for false debts and credit credit reporting.

Experience
Fifteen years ago I was financially devasted due to severe health issues. I filed bankruptcy, had a foreclosure, car repossession, tax lien, and ruined credit. I immersed myself in credit law. I settled dozens of accounts and had them removed to improve my credit. I personally sued four creditors and collection agencies and won cash settlements for their false reporting on my credit reports. Since then, I have completely recovered and have nearly $100,000 in revolving credit lines and perfect credit. I have owned a credit repair company for the past five years and have an additional three years of specific work in the collections and debt management industry. I am fully versed in the Fair Debt Collection Practices Acts (FDCPA), Fair Credit Reporting Act (FCRA), and have used them successfully in collection settlements and lawsuits for myself and others. I am also familiar with and abide by the Credit Repair Organizations Act (CROA). I have deleted or helped delete literally hundreds and hundreds of derogatory items from consumers' credit reports and helped negotiate many settlements with collection agencies and creditors. I have also advised people on bankruptcy at any stage. In the current credit market, I have successfully advised numerous people on how to obtain credit and how to negotiate for better terms.

Education/Credentials
BA University of Minnesota

You are here: Experts > Business > Corporate Law > Collections Law > Billing Collections

Collections Law - Billing Collections

Expert: Regan Shinski - 11/2/2009

Question
I live in Florida and had several hospital bills all at one time.
These bills all added up to several thousand dollars at once.Since
I did not have the money to pay them I have tried to set up payment plans with each but they always want more than I can afford to pay.So I have been sending them $50 each month till I can afford more.Recently I received a bill from a collection agency and I was wondering if they could do this since I am sending them money every month and if not what steps I could take to stop them as I know this is going to show up on my credit report.

Sincerly,
Chelsea

Answer
Hi Chelsea:

It is legal for them to go to a collection agency if you have not met their payment terms or secondary agreement you have with them. Based on what you wrote, it appears there was no new agreement/contract, so they can turn it to a collection agency.

To protect your credit, your options are to settle or enter into a payment arrangement with the collection agency. I would try and get it in writing and have the issue of credit reporting specifically laid out in the contract BEFORE you send them money. Anything you say to them can be used to collect the debt, so I would not openly admit the debt. Just say you want to pay it for simplicity or to make it go away. I believe you should be able to settle for less than the full amount. Even a settlement in the 50 - 80% range may help.

That is the path of least resistance. The other option is to fight aggressively. This is a complicated process but is highly successful, especially on medical payment. A professional credit repair company like ours deal with this daily and it is our recommended path in most cases. It's hard to get into the details in this forum, but you basically use the Fair Debt Collection Practices Law (FDCPA) to exercise your rights over and over. This is accomplished through HIPAA, validation, verification and state laws. The goal is to get the collection agency in a violation of any of these statutes. Most do not seem to be able to comply. Once the violation is in place, that becomes the basis for removal from credit reports and offsetting the actual debt. Proper credit repair is a time-sensitive issue. If you receive the notice mentioning the 30-day reply, you should reply by certified mail within that time period. Then dispute with the credit bureaus.

The bottom line is if a specific settlement - preferably in writing - is not in place with the collection agency, it will likely be reported. At that point, your only viable option is the credit repair mentioned above.

If you do neither of these options it is possible that they can sue you and get a judgement. That can lead to garnishing of wages, liens on real estate, attacking bank accounts, and even taking of personal property. All of those collection techniques need a judgement in place and are subject to limitations that vary by state.

Good luck, please let me know if I can help or if you have any other questions.

Regan
mbscompany@aim.com

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