The three levels of debt collection

 There are three levels to debt collection

The foundation level is the original debt. It might be a credit card debt, a student loan, a medical debt, or any other type of consumer debt obligation. The original creditor is the credit card company, the bank that made the loan, or the hospital that provided medical services.

The next level is the debt collection agency or the debt buyer who purchased the original debt.

Finally, there are the credit reporting agencies such as Equifax, TransUnion, and Experian.

A debt collection can impact you on each of these three different levels The problems caused by a debt collection must be solved on the level where the problem arose. For example, if a debt collection is time-barred by the statute of limitations on the first level it can still legally stay on your credit report for seven years.  But, if a collection agency improperly threatens to sue on this old “zombie debt”, it is possible to go after the debt collector directly in court for a Fair Debt Collection Practices Act violation and clean up your credit report in the process.

Never underestimate the power of litigation in the hands of a wizard attorney.