Credit Score Impacted by Outstanding Collection (That I thought was paid by insurer)

[Omni]

Hi all,

 

First post and would really appreciate constructive advice (as I've seen given throughout the site).

 

Situation

 

I'm a foreign national working in the US since Jan 2009. Before that I spent 5 years in the US for high school and college. In July 2007, I left the US to return to my native country to take a job (where I spent 15 months in Europe before being transferred back to the US).

 

During my time in College, I had 2 or 3 hospital visits for sports/other-related accidents that I believed to have been paid off through repeated calls to the insurance company and the Hospital. I left the US under the impression that all was well with these accounts only to find out now (2/3 years after the fact) that there are 2 amounts still out for collection!

 

The part where some of you may groan is that I did call the Hospital and the collections agency (the latter I gave my phone number and address but more on what I said later). I then got my Experian credit report (for free) and saw that these were the only these two negative items (other than some general personal information clear-up I need to do but that's for a different post).

 

I am not a debt-ridden person - I have never had a car loan or credit card (until recently, when I got a secure card to build credit ironically) and have some savings (and have been gainfully employed for the past 2 years with the same firm). I thought I had handled the hospital bills responsibly but alas, I find myself with a credit score somewhere around 600. I want to buy my first mortgage but the bank won't approve me for financing above 75% which I cannot afford.

 

The Collection Agency Call

 

So I panicked and called the collections people after my initial call to the hospital. I got a really nice woman who told me my balance and assured me that they do "offer a credit history clean-up service" so long as I pay the $3-figure and a small fee. The money is a relatively small amount and I have no problem paying it myself since I have zero confidence in my insurance company.

 

What to do next

 

Here are my questions, in a nice logical list:

 

1. Can they actually get this removed - as they claim - from my credit score so it is like I never had this issue?

2. If yes, please could you advise on the appropriate steps i.e. securing written confirmation using an attorney or other template for a letter?

3. Since it has been a while and I read that FICO will be paying this less and less attention (and thus less and less credit score impact), am I legally compelled to pay?

4. If yes and I must pay, will this affect my score negatively? Are there best-practice steps to doing so? (double-barrelled question there)

5. How should I handle the calls from the collections agency now they have my number?

 

6. (and most important): SHOULD I DISPUTE THIS CLAIM given the situation I outlined above or is there another way, specific to medical? The bill is real but I was under the impression my insurance company had paid and so left the country in good conscience. The unpaid medical bills are over a 2/3 year period so I find it difficult to believe I would have ignored these if they had only come to my attention better. Unfortunately, I have no easily accessible paper trail.

 

Sorry for the long email - my hope is that it has the right level of info so we can all focus on responses to the questions I have

 

Sincerely,

Stressed Foreigner

[Why Chat]

Hi all,

 

First post and would really appreciate constructive advice (as I've seen given throughout the site).

 

Situation

 

I'm a foreign national working in the US since Jan 2009. Before that I spent 5 years in the US for high school and college. In July 2007, I left the US to return to my native country to take a job (where I spent 15 months in Europe before being transferred back to the US).

 

During my time in College, I had 2 or 3 hospital visits for sports/other-related accidents that I believed to have been paid off through repeated calls to the insurance company and the Hospital. I left the US under the impression that all was well with these accounts only to find out now (2/3 years after the fact) that there are 2 amounts still out for collection!

 

The part where some of you may groan is that I did call the Hospital and the collections agency (the latter I gave my phone number and address but more on what I said later). I then got my Experian credit report (for free) and saw that these were the only these two negative items (other than some general personal information clear-up I need to do but that's for a different post).

 

I am not a debt-ridden person - I have never had a car loan or credit card (until recently, when I got a secure card to build credit ironically) and have some savings (and have been gainfully employed for the past 2 years with the same firm). I thought I had handled the hospital bills responsibly but alas, I find myself with a credit score somewhere around 600. I want to buy my first mortgage but the bank won't approve me for financing above 75% which I cannot afford.

 

The Collection Agency Call

 

So I panicked and called the collections people after my initial call to the hospital. I got a really nice woman who told me my balance and assured me that they do "offer a credit history clean-up service" so long as I pay the $3-figure and a small fee. The money is a relatively small amount and I have no problem paying it myself since I have zero confidence in my insurance company. NEVER NEVER NEVER believe a word any collection agency says, they lie like a rug and NEVER do anything they promise

 

What to do next

 

Here are my questions, in a nice logical list:

 

1. Can they actually get this removed - as they claim - from my credit score so it is like I never had this issue?

2. If yes, please could you advise on the appropriate steps i.e. securing written confirmation using an attorney or other template for a letter?

3. Since it has been a while and I read that FICO will be paying this less and less attention (and thus less and less credit score impact), am I legally compelled to pay?

4. If yes and I must pay, will this affect my score negatively? Are there best-practice steps to doing so? (double-barrelled question there)

5. How should I handle the calls from the collections agency now they have my number?

 

6. (and most important): SHOULD I DISPUTE THIS CLAIM given the situation I outlined above or is there another way, specific to medical? The bill is real but I was under the impression my insurance company had paid and so left the country in good conscience. The unpaid medical bills are over a 2/3 year period so I find it difficult to believe I would have ignored these if they had only come to my attention better. Unfortunately, I have no easily accessible paper trail.

 

Sorry for the long email - my hope is that it has the right level of info so we can all focus on responses to the questions I have

 

Sincerely,

Stressed Foreigner

Follow the instructions here;

 

Opt out

http://whychat.5u.com/OPTOUTINST.HTML

If you have a NEW permanent Stateside address, try to get any older Stateside addresses deleted

 

Send each CRA where ANY MEDICAL ACCOUNT is reporting this, ( follow all the directions even if they seem "strange" list the accounts on each letter AS THEY APPEAR on that CRA report)

http://whychat.5u.com/hipaadisp.html

 

This will most likely get them all deleted, if not post back here ON THIS THREAD with your results and further questions.

Edited July 24, 2009 by Why Chat

[Omni]

Thank you Why Chat - Appreciate the fast response.

 

I just want to clarify before I do anything, the medical treatment I received was real. The thing I am concerned about is that I believed my accounts to be paid off but they obviously weren't.

 

Given this, would your letter template (which seems great) be applicable? I ask becuase it states: "I have no knowledge or records of account # xxxxx from xxxxxx on my report # xxxxx. " which is not strictly the case...

[Omni]

bump to Why Chat

[wijg]

Thank you Why Chat - Appreciate the fast response.

 

I just want to clarify before I do anything, the medical treatment I received was real. The thing I am concerned about is that I believed my accounts to be paid off but they obviously weren't.

 

Given this, would your letter template (which seems great) be applicable? I ask becuase it states: "I have no knowledge or records of account # xxxxx from xxxxxx on my report # xxxxx. " which is not strictly the case...

 

I know I'm not whychat, but I believe I can answer your question. The template would still be applicable. Even though you know of the account with the OC, you're disputing the CA's account. Particularly since you believe the original account was paid off, you definitely don't have records stating otherwise, so the template still applies and you should still send the dispute letter. HTH!

[breeze]

What you actually know is irrelevant to the process you are following. You need them to acknowledge what information they know or have on file.

[Omni]

OK thanks Breeze, Why Chat and others...

 

Progress so far:

 

1) I have opted out from the sharing of information among CRAs

2) I am compiling list of all firms I need to request an opt-out from

3) I have not yet sent my HIPAA dispute letter

 

The reason I have not yet sent my pre-dispute letter is because I want to have the 4/5 non-current addresses removed from my reports at each CRA. So:

 

- Do I need to dispute/remove these addresses BEFORE I pre-dispute my actual collection?

- IF so, how do I do this? (I looked on Why Chat's all purpose letters but couldn't find one for this)

 

Thanks,

David

[bonbonXO]

OK thanks Breeze, Why Chat and others...

 

Progress so far:

 

1) I have opted out from the sharing of information among CRAs

2) I am compiling list of all firms I need to request an opt-out from

3) I have not yet sent my HIPAA dispute letter

 

The reason I have not yet sent my pre-dispute letter is because I want to have the 4/5 non-current addresses removed from my reports at each CRA. So:

 

- Do I need to dispute/remove these addresses BEFORE I pre-dispute my actual collection?

YES!

- IF so, how do I do this? (I looked on Why Chat's all purpose letters but couldn't find one for this)

Start it just like any other dispute with the CRA, but listed all the incorrect address and why they are incorrect.

I think I put something like having these incorrect addresses on my CR leave me open to Identity theft. With this dispute I sent copy of my DL, state ID card and a current copy of of a utility bill.

If you have older positive trade line, that may be reporting under older addresses contact those creditor and give them updated contact information.

http://creditboards.com/forums/index.php?showtopic=105304&hl=address+old

 

Thanks,

David

I have no knowledge or records of account # xxxxx from xxxxxx on my report # xxxxx. " which is not strictly the case...

You may have knowledge of the account with the OC, you have no knowledge of the account with the CA.The CA is the one reporting not the OC.

Edited July 29, 2009 by bonbonXO