Credit card debt sold to 3rd party & under debt management.
Discussion
Scenario:
Credit card payments become overwhelming, and the customer enters a debt management agreement.
Regular payments are maintained, however credit card company sells debt on to 3rd party company.
Debt management company re-arranges payments to 3rd party, and regular payments are maintained.
However - this 3rd party company has twice (over a 6 month period) sent letters out stating that the account is in arrears (but it isn't although of course the original debt is), but the nature of the letters are 'if you don't contact us about this, we may take action against you'.
Also - this 3rd party company has recorded the debt as "Default" on credit scores.
But...
There is also another CC debt (still maintained by the original [different to the above] CC company) which is also in a debt management agreement - but this is recorded as "up to date" in the credit records.
So my question is - can the 3rd party company maintain the debt as being in "default" even when regular payments are ongoing?
Is this normal practice?
Asking for a friend etc.
TIA.
Credit card payments become overwhelming, and the customer enters a debt management agreement.
Regular payments are maintained, however credit card company sells debt on to 3rd party company.
Debt management company re-arranges payments to 3rd party, and regular payments are maintained.
However - this 3rd party company has twice (over a 6 month period) sent letters out stating that the account is in arrears (but it isn't although of course the original debt is), but the nature of the letters are 'if you don't contact us about this, we may take action against you'.
Also - this 3rd party company has recorded the debt as "Default" on credit scores.
But...
There is also another CC debt (still maintained by the original [different to the above] CC company) which is also in a debt management agreement - but this is recorded as "up to date" in the credit records.
So my question is - can the 3rd party company maintain the debt as being in "default" even when regular payments are ongoing?
Is this normal practice?
Asking for a friend etc.
TIA.
@Claudia Skies
What you say was exactly our understanding of the situation.
I did in fact think that Ray Luxury-Yacht's post had a 'freeman of the land' tone to it!
@oldcynic
Interest has been ceased on all the debts.
There are no worries about the credit record - nobody wants to borrow more money - it was just thought odd that the debt was flagged as being in default, despite regular ongoing payments.
A debt management company is already involved.
I think the biggest concern for my friend was the tone of the letters received form the 3rd party, and doing some research on said 3rd party shows them to have been a little underhanded in past years - however it would appear that in the past 2 - 3 years new legislation has been introduced in an effort to combat underhanded dealings.
What you say was exactly our understanding of the situation.
I did in fact think that Ray Luxury-Yacht's post had a 'freeman of the land' tone to it!
@oldcynic
Interest has been ceased on all the debts.
There are no worries about the credit record - nobody wants to borrow more money - it was just thought odd that the debt was flagged as being in default, despite regular ongoing payments.
A debt management company is already involved.
I think the biggest concern for my friend was the tone of the letters received form the 3rd party, and doing some research on said 3rd party shows them to have been a little underhanded in past years - however it would appear that in the past 2 - 3 years new legislation has been introduced in an effort to combat underhanded dealings.
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