Ask Jack About Debt

Old Debt Under $1,000

Small Debt over 5 years old - the situation changes!

If you have a debt of less than $1,000 and it has over five years old, you have come to be a victim of what I call vulture collections. Debt doesn't have an official time limit, but in practical terms a debt will change status after a certain length of time. Long after the debt has been written off by everyone, long after all collection efforts have stopped, the "owner" of the debt sells the debt to collection agency (often part of a law firm) that specializes in this type of debt - probably for pennies on the dollar.

They are playing the odds. They mail out a few thousand collection letters and if 10% of the people send them a check, they are probably a winner. They are not going to waste a lot of time on collection efforts. They are going to get what they can from those who, for whatever reason, decide to pay up (sometimes people pay even when the debt is not legitimate, I have found, just to get the "lawyers" off their backs.).

You should not pay this debt; nor should you waste time worrying about it.

If they call you, do not talk to them. My advice is that you do not talk to anyone from a collection agency, ever. They are experts at double talk and separating people from their money. You cannot trust anything they say. You should never deal with them.


The good news is that collection agencies are federally regulated and you can stop them from contacting you. For details on what collection agencies may do, see "Fair Debt Collection Practices Act"

If you want to stop them from pursuing you, send them the letter below. Unless they are willing to go to court, they will just go away. The original creditor will not bother you. They have already written off the debt. This should be the end of any contact.

You can copy the letter here and paste it into your word processor to fill in the necessary details. Keep a copy and send it certified mail, return receipt requested. This will cost a few dollars but in most cases it will work. And if it does not, the collection agency is very likely to be in violation of federal law.


DATE: [[date]]

TO: [[ name and address of collection agency ]]

FROM: [[ your name and address ]]

RE ACCOUNT NUMBER: [[ account number if relevant. It should be on any letter you have received from collection agency ]]

BALANCE DUE: [[ amount ]]

You are herby notified, under provisions of the Fair Debt Collection Practices Act [15 USC 1692c], that you must cease and desist all communications with me after being notified in writing that I no longer wish to communicate with you. Therefore I demand that you stop calling me at home, at work, on my cell phone or any other location.

In accordance with the federal FDCPA, now that you have received this letter, you may contact me only to inform me that you are terminating further collection efforts; invoking specified remedies which are ordinarily invoked by you or your company; or you intend to invoke a specified remedy.

1. You and your organization must CEASE AND DESIST all attempts to collect the above debt. Failure to comply with this law will result in my immediate filing of a complaint with the Federal Trade Commission and the Attorney General of [[insert name of your state]].

2. Let this letter also serve as your warning that I may utilize telephone recording devices in order to document any conversations that we may have in the future.

3. Furthermore, if any negative information is placed on my credit bureau reports by your agency after receipt of this notice, I intend to pursue any and all remedies available to me by law by means of civil suits against you and your organization, both personally and corporately.

Since is it my policy neither to recognize nor deal with collection agencies, I will discuss this account only with the original creditor.


[[ your name and signature]]



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