Complaint Review: Portfolio Recovery Associates - Collection Agency - Norfolk Virginia

I know you may never see this since its been so long since you replied here, but it's worth a try.

I settled with a collection agency on a debt of $568 for $240 I requested a letter from them before I made any payments stating that once I pay the $240 this debt will be considered paid in full and the trade line on my credit report will be changed accordingly (which it was) it was changed from a collection to "Paid in full or Settled for amount less than owed" this was in May 2010 and in Dec 2010 I hired Lexington Law Firm to help me dispute two listings on my reports, one was a charge off and the other was that collection which I never believed was an accurate listing on my reports, I only paid them because I wanted to resolve it.

Lexington sent dispute/verification letters to the collection agency as well as the 3 bureaus and within 8 days the settled collection was removed from my credit reports. So my first question is, being that it was under 600 I should not expect to be sent a 1099 from them correct?

Now secondly, I'm am in the process of settling a debt that was mine with Portfolio Recovery I settled a 1700 debt for 1000, I made sure to receive a letter before I made any payments, this is what it says in the letter " If you complete this payment plan and our company is reporting our companies trade line for this account to the three major credit reporting agencies, our company will report this account as settled" the funny thing is once I made my first payment they removed it from my credit reports, I just hope they don't put it back on once I'm done with my payments.

So my second question is........this debt was 1700 when should I receive the 1099 from them? After I complete my payments? If I don't receive one, should I contact them and have them send me one?

Thank you in advance for any input you or anyone can give me.

We do have a typed written settlement letter that we collected from the company.  So I don't have any worries there.  If they weren't willing to settle for that amount, why did they settle?  It is a total rip-off.

go to www.budhibbs.com and check out these scumbags - they are known for the 1099c scam

good luck and fight back

Do you have a WRITTEN AGREEMENT from the creditor that the balance of what you owed was forgiven????  If the "settlement" was not in writing and signed by an authorized agent of the creditor, then you had no settlement agreement.  Your credit was established in writing, therefore any settlement MUST be in writing.  A written contract/agreement cannot be amended/altered verbally.

Also, FYI "WRITTEN OFF" DOES NOT EQUAL FORGIVEN.  A debt that is written off by a business is still a valid, collectible, and actionable debt. 

Also,  if the amount that was forgiven was in excess of $600, the creditor is required by law to file a 1099 with the IRS for the imputed income-the portion of your debt that was forgiven is considered taxable income for you.  A copy of the 1099 would have been mailed to you.  If you never received a 1099 from the creditor, this would further substantiate that you did not have a valid "settlement agreement" with the creditor.

You should check the statute of limitations in your state for this debt-if it's beyond the SOL (time barred) you cannot be lawfully compelled to pay it.  Also, you should deal with the CREDITOR ONLY- not any debt collection outfit.