Discharge A Debt, then Change The Name - The “Hot Potato” Of Debt Buying
January 3, 2007
When you owe money to a creditor and don’t pay, that creditor may decide to sell your loan to some other company. It happens all the time, and it’s big business. Companies sell off thousands of debts to these other companies. That’s why your Visa card may be listed as something completely different.
Some debt buyers buy loans that have been discharged in bankruptcy in the hopes that they can wring some money out of them. Make no mistake - these companies are buying discharged debt on purpose, not because they have made a mistake. They pay pennies on the dollar and have turned it into a profitable business model.The debt buyer may send collection letters or make a few phone calls, but these companies know this is a risky tactic - they could call someone who knows their rights and get sued!
The more likely scenario is that the debt buyer will just report it to the credit bureaus and do nothing. They are playing the odds that you apply for a mortgage or other credit and are forced to pay the debt in order to clean your credit report and qualify for attractive financing. They’re willing to play this waiting game because they are paying so little to buy the discharged debt.
These actions may violate the bankruptcy discharge, the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, or your state laws. Don’t let the creditors steamroll over your rights - take action immediately.
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