Q: I verbally agreed to owning a debt and made a payment. Can the collections sue me?
Here are the details. I opened this credit card in Mass. I now live in Ga. I got a couple letters threatening to put a warrant out for my arrest if i did not call and negotiate with them. I was scared and stupid so i called verbally agreed that it was my debt, and made a payment. I now just checked my credit report today and that account closed last year. Can the collections agency still sue me?
A:
There are a couple of different issues in play here. As Julie stated, the fact that your credit report is showing the account closed does not impact your liability for the debt.
That said, there are limitations on the actions a collection agency can take that you should be aware of. For example, a debt collector cannot "put a warrant out for your arrest," and claiming that they will do so is a violation of the Fair Debt Collection Practices Act. In addition, the FDCPA and some state consumer protection statutes prohibit a debt collector from threatening to sue you if they can't in fact do so. A collection agency (as opposed to an original creditor, a debt buyer or an attorney representing a creditor) does not have standing to sue.
You may want to consult a consumer protection lawyer in your area to find out whether you have valid FDCPA or state claims against the debt collector.
*David Levin is the Partner in charge of UpRight Law's consumer rights litigation department. UpRight Law is a national law firm with licensed attorneys providing bankruptcy and consumer legal services in all 50 states. He is licensed in Illinois, Ohio and West Virginia, as well as several United States District Courts. He has 22 years of litigation experience, the last 18 of which have been focused on consumer rights litigation. This response is for informational purposes only and is not intended to be legal advice. For legal advice, consult an attorney licensed in your state with the appropriate expertise.
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