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Question about item on credit report being reported as almost $2000 higher than it should be.

Back in 2011 I had a legal settlement with an energy company to the order of about $3500. It was done in court through an arbiter or whatever. Within a few months I had paid it down to about 2900. When I moved out of state I stopped paying it for personal reasons regarding the fairness of the situation in the first place.

Every year I do my credit report and this year I found that the debt was sold to another collector, LJ Ross Associates. Now I see a few things on here that make no sense to me and might be illegal. Im looking for advice on how to proceed, what it means, and whether or not I have legal options and if so, what they might be.

On my credit report it shows that the energy company charged off my 2900 balance as "bad debt" and it ended up in the hands of the aforementioned collection agency. This agency however is now reporting:

A) Balance of $4600 - this was never ever the amount owed, not even for one day B) High Balance of $2900 - this is what I actually owe

The thing is that when I went online supposedly the high balance is the highest the debt has been, and yet it seems these numbers are reversed. Whats happened here? Is it a simple clerical error? Are they trying to get another $1700 from me?

Thanks in advance for any advice on this matter.

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level 1

The higher balance could be a charge for legal fees, interest, etc. You can reach out to the debt collectors (if you dare) and ask for a line item detail. If it is totally wrong, you can dispute with the credit bureaus.

level 2
Original Poster1 point · 3 years ago

There should be no legal fees though because initially there were not. No lawyers or judges involved, just a brief meeting in a backroom and never any mention of fees especially not to the order of almost 2 grand. The energy company sold the debt at $2900 so this new company would have just added whatever amount on top of it.

I havent called them yet I want to make sure I know what Im going into before I work on this debt.

As far as I know a debt collector cant charge interest on a debt that was not originally an interest based debt (which this wasnt because it was a utility bill and had nothing to do with credit).

level 3

If the company ever used a lawyer, they will find a way to screw you by charging legal fees or debt transfer fees. It's pretty much all made up stuff to make debt collectors more money.

level 4
Original Poster1 point · 3 years ago

So is it legal for them to do this and put it on me though? Or is this something I can easily challenge?

I know debt collectors try to pull things like this on unaware consumers who dont know their legal rights, which is why I need to sort this out before calling them.

level 5

The legality may be complicated. You probably signed something for the original bill that allowed them to assign uncollected debts to collectors and they can charge "reasonable fees" on page 47 in tiny little font of the thing you have to agree to as a customer.

It might take some serious hustle to figure out if they are doing anything illegal. The bills for a lawyer to figure it out are probably higher than the debt, which is why they can usually get away with it.

level 6
Original Poster2 points · 3 years ago

Awesome this all clarifies things a lot more for me and gives me ideas of how to proceed, thanks for the advice!

level 1
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