Legal Question in Credit and Debt Law in California

Collector threatens suit over loan application.

In '92 I received a loan of $500 from my university. It went into default and when I saw it on my credit report I made arrangements to pay it in '99 at $20/month.I missed a payment last month and got a phone call that the collection agency just ran my credit report and found out I recently applied to get a home loan. Now they threaten to sue me if I don't pay them off in full (now $1200.00) and my original payment agreement has now been terminated by them. My husband can go ahead with the home loan without me on it and will this protect us from complications? We were just married and this is NOT his debt. Will my wages be able to be garnished if they win a lawsuit and can they sue me, being that they are a third party(an agency)? Has the statute of limitations been extended because I had made an oral agreement in 1999 to make payments? Is it legal for them to run a credit report on me without my permission? I know this is more than one question but PLEASE don't disregard them all. I BEG you for advice.


Asked on 2/25/02, 10:07 pm

2 Answers from Attorneys
Larry Rothman Larry Rothman & Associates

Re: Collector threatens suit over loan application.

A collection agency can run your credit report if they were retained for collection purposes. Your husband cannot be liable for your separate debt, but if he has community property assets, these could be attached. I would be happy to provide you with free consultation if you fax to me all documetation you have on the student loan including any letters to 714 363 0229. I will call you after I have reviewed them.

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Answered on 2/26/02, 11:52 am
Ken Koenen Koenen & Tokunaga, P.C.

Re: Collector threatens suit over loan application.

Why don't you see if you can get the money from someone else, and pay them off. First of all, it will get off your credit report a lot faster. Second, you may be able to come to an agreement with them, whereby if you pay them off in full now, they will remove the report completely from your file. Finally, they need to justify what the balance is. Sometimes, collection agencies tack on interest and fees that they are not entitled to.

bottom line is, if you owe the money, get it paid, even if you need to borrow the money elsewhere. Get this collection agency off your back.

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Answered on 2/26/02, 2:03 pm


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