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(LA Times)   Wait it gets sleazier: debt parking   (latimes.com) divider line
    More: Asinine, Credit, debt parking, Money, Midwest Recovery Systems, Mark Neeb, Consumer protection, Debt, credit file  
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1717 clicks; posted to Business » and Main » on 03 Dec 2020 at 5:03 PM (11 weeks ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook



26 Comments     (+0 »)
 
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2020-12-03 2:31:48 PM  
Midwest Recovery Systems

That name sounds familiar. I think that's the company that came after me for a $51 hospital bill. I never got the bill, or any notice, and they turned it right over (this particular hospital is famous for that). So of course I tell them I never got it. They don't believe me because everybody says that. So I say, send me the bill and I'll pay it. The guy wasn't sure what to say for a second. I guess that never happens?
 
2020-12-03 2:44:23 PM  
Best bit is, if you pay them anything towards the "debt" it validates it and you no longer have any right to fight it.

Also, they're going to end up paying a few grand here and there towards the judgement and be doing the same thing with a new name next year.
 
2020-12-03 5:14:34 PM  

fnordfocus: Best bit is, if you pay them anything towards the "debt" it validates it and you no longer have any right to fight it.


That's not how it works, even for real debt.  This appears to be outright fraud, so you could not only fight it, but could press criminal changes.
 
2020-12-03 5:36:59 PM  
I want to make sure you get my payment. Where are your offices? I'll deliver it in person.
 
2020-12-03 5:53:16 PM  
Do they post it in a way that it won't show up in credit monitoring systems?  If I so much as fart in the general direction of my credit, I get a push notice from Credit Karma.
 
2020-12-03 5:59:47 PM  
Also... this seems like a really bad scheme:

I've never had anything in collections, but I ran it through the Credit Karma simulator out of pure curiosity.
Fark user imageView Full Size


Oh noes, how will I ever get an auto loan now?  I'll have to go with someone who finances subprime as a core business, like Mitsubishi, Hyundai-Kia, or Nissan.  My status as credit-poor will be branded across my front grille with a deformed H of shame!

images-na.ssl-images-amazon.comView Full Size


This seems like a really, REALLY stupid scheme.  Almost no impact, but criminal fraud charges if caught.  It seems like one of those crimes that would be so high-risk/low-reward that nobody would even bother.  You know, like voting fraud
 
2020-12-03 6:14:26 PM  

Izunbacol: I've never had anything in collections, but I ran it through the Credit Karma simulator out of pure curiosity.


I have been twice.  Both times I made a point of generating billable hours for their lawyers on their way to them dropping it, as a penalty for their incompetence.
 
2020-12-03 6:23:39 PM  
On a slightly related note, I have issues with another Snaptastic in the UK, who is using my email address for lots of things because she isn't very bright. I ended up watching her attempts to register with job-hunting sites (she can't activate the accounts), buying enough things to know that she has a kid, and even where she lives. I sent her a snail-mail letter with all the stuff she linked to my email. She changed some, but still occasionally uses my email address.

Now she has a collection agency trying to collect a debt. I flat out told them they have the wrong Snaptastic, since I am in the US and know that I don't owe them anything.

They don't care, and keep trying to bargain with me. It is getting downright laugh-worthy.

...and they are not as threatening as US collections agencies, which makes it funnier.
 
2020-12-03 6:49:07 PM  
It's called "debt parking," and it doesn't mean your financial obligations have stopped or are sidelined on the road of your financial life.

Debt parking is when a collector quietly - and illegally - places dubious obligations on your credit file so they'll surface during a moment of need, such as when you apply for a loan or seek a job.

The collector is hoping you'll cough up at least a partial payment, even though you may not recognize the debt, just to make the problem quickly go away.


Just call it "fraud" already.
 
2020-12-03 6:50:16 PM  
Yeah, fark Midwest. They bought an old business debt I had and sued me. My attorney said, "see you in court" and they eventually dropped the whole thing.
 
2020-12-03 6:51:39 PM  

majestic: Yeah, fark Midwest. They bought an old business debt I had and sued me. My attorney said, "see you in court" and they eventually dropped the whole thing.


Wait... so was it a legitimate debt?  I got the impression they were just making stuff up from the article.
 
2020-12-03 6:51:45 PM  

Snaptastic: On a slightly related note, I have issues with another Snaptastic in the UK, who is using my email address for lots of things because she isn't very bright. I ended up watching her attempts to register with job-hunting sites (she can't activate the accounts), buying enough things to know that she has a kid, and even where she lives. I sent her a snail-mail letter with all the stuff she linked to my email. She changed some, but still occasionally uses my email address.

Now she has a collection agency trying to collect a debt. I flat out told them they have the wrong Snaptastic, since I am in the US and know that I don't owe them anything.

They don't care, and keep trying to bargain with me. It is getting downright laugh-worthy.

...and they are not as threatening as US collections agencies, which makes it funnier.



There's several people that have made the mistake of using my email address or phone number. Once, I don't care, everyone slips up and types something wrong occasionally, but there's a few people that they're clearly using mine as their throw-aways. Fine, but your reservation for a hotel room in Aspen over the holiday two years ago was upgraded to the grand suite, and your rental car cancelled. Oh, and Miss former small town elected representative that uses my phone number, sorry about your test results and your follow up appointment getting cancelled.
 
2020-12-03 7:03:52 PM  
Having recently refinanced I can see how this works. The bank isn't going to loan you any money with an unpaid debt. So you can spend months fighting it and not get the financing you need right now or you can suck it up and pay. These kinds of debt also don't show up on your credit report most of the time, they only come up when there's a deep dive on your credit, like when you're taking out a big loan.
 
2020-12-03 7:05:51 PM  

Izunbacol: majestic: Yeah, fark Midwest. They bought an old business debt I had and sued me. My attorney said, "see you in court" and they eventually dropped the whole thing.

Wait... so was it a legitimate debt?  I got the impression they were just making stuff up from the article.


They do that, too. Usually by purchasing some super old debt that is noncollectable and then trying to get someone to pay anything just to be left alone. In my case it was a business that I was a partner in but I had never co-signed any of the loan documents. Hell, I didn't even know my partners had borrowed the money until Midwest went after me.
 
2020-12-03 8:12:21 PM  
Curious. Would anyone in a position of authority care if someone wasted the entire company with automatic weapons? As an object lesson?
 
2020-12-03 8:16:53 PM  
During a regular background investigation I found that 4 years earlier a clinic claimed I never paid them.

Later, as my insurance's online stuff got better I was able to see a history. The clinic said I'd been there multiple times over a couple days. I had not.

So I told my investigator I'd pay it. I did not.

fark em.
 
2020-12-03 8:18:38 PM  

wax_on: Having recently refinanced I can see how this works. The bank isn't going to loan you any money with an unpaid debt. So you can spend months fighting it and not get the financing you need right now or you can suck it up and pay. These kinds of debt also don't show up on your credit report most of the time, they only come up when there's a deep dive on your credit, like when you're taking out a big loan.


Adding to my above story, this debt I reference would have been on the books when I applied and got a mortgage.

It was only a couple hundred bucks though.
 
2020-12-03 9:12:45 PM  
The settlement also includes a fine of $24.3 million, which was suspended because of "an inability to pay."

So, in other words, the debt collector doesn't have to pay their debt. Wonderful.  How about forcing them into bankruptcy and putting them out of business. Why show them the mercy they refused to show others?
 
2020-12-03 9:47:34 PM  
So long as the punishment is me being allowed to park on their windpipe ... try me sleezeballs.
 
2020-12-04 1:32:03 AM  

wax_on: Having recently refinanced I can see how this works. The bank isn't going to loan you any money with an unpaid debt. So you can spend months fighting it and not get the financing you need right now or you can suck it up and pay. These kinds of debt also don't show up on your credit report most of the time, they only come up when there's a deep dive on your credit, like when you're taking out a big loan.


No, this shows up all the time. Some scoring models won't put a whole lot of weight on a small bill, and I think medical debt gets its own treatment too. So you can't just rely on services that show you some score to know when something is up. But there are plenty that offer regular access to full credit reports - creditkarma covers 2 of 3 agencies. They, and frankly too many others, are now proactively sending notices if there's anything potentially concerning. It's a PITA but worth staying on top of. As you say, finding out during a loan application can be a big problem.

I had a small mystery medical bill pop up once years ago too. I googled for advice and it worked pretty much as advertised. But was fairly slow, I think 2 or 3 months round trip for all agencies to drop it. The gist of it was to make it the biggest possible hassle for them - dispute in writing - handwriting. In colored ink. On colored, lined paper. Though the lines are obviously only suggestions. I used a steno pad - odd paper size and an edge torn from the spiral binding.
 
2020-12-04 2:17:16 AM  

OccamsWhiskers: wax_on: Having recently refinanced I can see how this works. The bank isn't going to loan you any money with an unpaid debt. So you can spend months fighting it and not get the financing you need right now or you can suck it up and pay. These kinds of debt also don't show up on your credit report most of the time, they only come up when there's a deep dive on your credit, like when you're taking out a big loan.

No, this shows up all the time. Some scoring models won't put a whole lot of weight on a small bill, and I think medical debt gets its own treatment too. So you can't just rely on services that show you some score to know when something is up. But there are plenty that offer regular access to full credit reports - creditkarma covers 2 of 3 agencies. They, and frankly too many others, are now proactively sending notices if there's anything potentially concerning. It's a PITA but worth staying on top of. As you say, finding out during a loan application can be a big problem.

I had a small mystery medical bill pop up once years ago too. I googled for advice and it worked pretty much as advertised. But was fairly slow, I think 2 or 3 months round trip for all agencies to drop it. The gist of it was to make it the biggest possible hassle for them - dispute in writing - handwriting. In colored ink. On colored, lined paper. Though the lines are obviously only suggestions. I used a steno pad - odd paper size and an edge torn from the spiral binding.


I just waited mine out.
 
2020-12-04 11:07:17 AM  

runwiz: The settlement also includes a fine of $24.3 million, which was suspended because of "an inability to pay."

So, in other words, the debt collector doesn't have to pay their debt. Wonderful.  How about forcing them into bankruptcy and putting them out of business. Why show them the mercy they refused to show others?


$$$$$$$$$$$$$$$$$$
 
2020-12-04 11:24:59 AM  

runwiz: The settlement also includes a fine of $24.3 million, which was suspended because of "an inability to pay."

So, in other words, the debt collector doesn't have to pay their debt. Wonderful.  How about forcing them into bankruptcy and putting them out of business. Why show them the mercy they refused to show others?


I took that to mean they were already in bankruptcy and/or out of business.
 
2020-12-04 11:41:18 AM  
fark the fine, these people should be in prison.
 
2020-12-04 3:29:45 PM  

OccamsWhiskers: wax_on: Having recently refinanced I can see how this works. The bank isn't going to loan you any money with an unpaid debt. So you can spend months fighting it and not get the financing you need right now or you can suck it up and pay. These kinds of debt also don't show up on your credit report most of the time, they only come up when there's a deep dive on your credit, like when you're taking out a big loan.

No, this shows up all the time. Some scoring models won't put a whole lot of weight on a small bill, and I think medical debt gets its own treatment too. So you can't just rely on services that show you some score to know when something is up. But there are plenty that offer regular access to full credit reports - creditkarma covers 2 of 3 agencies. They, and frankly too many others, are now proactively sending notices if there's anything potentially concerning. It's a PITA but worth staying on top of. As you say, finding out during a loan application can be a big problem.

I had a small mystery medical bill pop up once years ago too. I googled for advice and it worked pretty much as advertised. But was fairly slow, I think 2 or 3 months round trip for all agencies to drop it. The gist of it was to make it the biggest possible hassle for them - dispute in writing - handwriting. In colored ink. On colored, lined paper. Though the lines are obviously only suggestions. I used a steno pad - odd paper size and an edge torn from the spiral binding.


I just went through this. There was a small tax bill that the city said I owed that didn't show up on my full credit report. I don't remember seeing the bill but it was only a couple hundred so I just paid it rather than fighting about it for months.
 
2020-12-04 4:31:35 PM  
Guillotines. NOW!
 
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