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Anarchy99

Small Claims Case . . . What To Do

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Several years ago, I used a store credit card to purchase some stuff after renovating a room in my house. The store had a promo going that you got 0% financing if you made minimum monthly payments and paid it off within however many years (it was like 3 or 5 years). I made all the monthly payments, got to the end of the program, and thought everything was done. I was enrolled in paperless billing / invoicing, so I did not receive printed statements in the mail.

A year or two later, I went back to the same store to purchase something else and wanted to use the store credit card again. However, I was not able to as the charge was declined. They told me the reason was the account had been closed due to inactivity. It wasn't a big purchase, so I paid case instead.

Jump ahead another 18-24 months (essentially now). An attorney's office sent me a summons to appear in small claims court because they bought my debt and claim I owe $1,500. Apparently the store credit card account was held by Chase, and they sold my alleged uncollected debt to this attorney. 

The store now claims, when I was making my monthly payments all those years ago, I made another purchase on that account. So according to the store, that bumped up my minimum payment amount slightly so when I thought I had made all my payments I was short by like $20.00. On occasion, I paid extra in my monthly payment to help pay it off quicker. But according to the store, when I made the extra payments, I did not specifically request that the amount be applied to the 0% financing offer, so they did not apply it to that purchase and paid off any other charges on the account first.

So when I came to the what I thought was the final month's payment, they stuck me with years and years of interest. And since I never knew about it, I obviously made no payments, so they hit me with $30 each month since then in non-payment charges. Now they rolled in additional attorney's fees and filing fees on top of it.

At no point did they call me, write me, email me, or text me that I owed any money. In all this time, no one communicated with me at all and this is the first I heard of it. However, the store still sends me emails every two days on their weekly specials, service plans, and rewards program. At this point, the place demanding money won't listen to what the store did or said . . . they only want the money.

My concern is that I don't have access to any of the paperwork anymore. My credit card account and on-line customer account has been closed, so I can't even attempt to print out anything to support my case (and it's so long ago I doubt the records could be retrieved anyway).

Any suggestions on how to combat this?

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Show up to small claims and insist they dismiss it or you will demand a hearing where you can testify based on your memory what happened.  They won't have a witness who can back up their "business records."

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1 minute ago, Anarchy99 said:

Several years ago, I used a store credit card to purchase some stuff after renovating a room in my house. The store had a promo going that you got 0% financing if you made minimum monthly payments and paid it off within however many years (it was like 3 or 5 years). I made all the monthly payments, got to the end of the program, and thought everything was done. I was enrolled in paperless billing / invoicing, so I did not receive printed statements in the mail.

A year or two later, I went back to the same store to purchase something else and wanted to use the store credit card again. However, I was not able to as the charge was declined. They told me the reason was the account had been closed due to inactivity. It wasn't a big purchase, so I paid case instead.

Jump ahead another 18-24 months (essentially now). An attorney's office sent me a summons to appear in small claims court because they bought my debt and claim I owe $1,500. Apparently the store credit card account was held by Chase, and they sold my alleged uncollected debt to this attorney. 

The store now claims, when I was making my monthly payments all those years ago, I made another purchase on that account. So according to the store, that bumped up my minimum payment amount slightly so when I thought I had made all my payments I was short by like $20.00. On occasion, I paid extra in my monthly payment to help pay it off quicker. But according to the store, when I made the extra payments, I did not specifically request that the amount be applied to the 0% financing offer, so they did not apply it to that purchase and paid off any other charges on the account first.

So when I came to the what I thought was the final month's payment, they stuck me with years and years of interest. And since I never knew about it, I obviously made no payments, so they hit me with $30 each month since then in non-payment charges. Now they rolled in additional attorney's fees and filing fees on top of it.

At no point did they call me, write me, email me, or text me that I owed any money. In all this time, no one communicated with me at all and this is the first I heard of it. However, the store still sends me emails every two days on their weekly specials, service plans, and rewards program. At this point, the place demanding money won't listen to what the store did or said . . . they only want the money.

My concern is that I don't have access to any of the paperwork anymore. My credit card account and on-line customer account has been closed, so I can't even attempt to print out anything to support my case (and it's so long ago I doubt the records could be retrieved anyway).

Any suggestions on how to combat this?

First thing I would do is contact the attorney and have him send you a copy of his files.  You should verify that the charges and payments according to the store are correct.  If they are, then you could probably call the attorney back and negotiate down the amount you owe and make payment.  

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1 minute ago, Snotbubbles said:

First thing I would do is contact the attorney and have him send you a copy of his files.  You should verify that the charges and payments according to the store are correct.  If they are, then you could probably call the attorney back and negotiate down the amount you owe and make payment.  

They sent me copies of several monthly statements from the store . . . but they were all after the interest charges from the store were added in. But they are all from well past the time I believed I was done paying off my multi-year, no interest financing purchase. So in their eyes, it proves I did not make any payments.

I did ask to try to make a settlement and they have not even entertained that option.

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One of the issues here is that originally Best Buy had their own financing group / store credit card. Then they sold that off to another lender. Then that financing program got bought out by Chase. And now the law firm going after me bought out my account. So there are multiple companies involved and I don't believe there is anyway to "prove" my case as I don't even think the records from years and years ago are still available.

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10 minutes ago, Anarchy99 said:

One of the issues here is that originally Best Buy had their own financing group / store credit card. Then they sold that off to another lender. Then that financing program got bought out by Chase. And now the law firm going after me bought out my account. So there are multiple companies involved and I don't believe there is anyway to "prove" my case as I don't even think the records from years and years ago are still available.

this is all just so wrong.  I feel for you, but don't have any suggestions.

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Sucks man but that’s why they do that. I feel bad, but I would bet that according to the letter of the legalese that you didn’t pay it all off on time and thus you owe interest over those 0% years. Those things suck because they are built to get all the interest back. It’s not a charge interest on the balance going forward it’s a you didn’t pay it all so we backcharge all the interest.

I don’t get why you weren’t getting more statements though that doesn’t make sense or you aren’t telling the whole story. You got them while paying it off so did you just ignore them after you paid it off?

Also, you need to check your statements going forward. They list out all the “programs” and now the new credit card laws make CC companies pay down the highest interest automatically. They did that for 0% transfers so that any new spend got whacked as they would pay down the 0% stuff first and there was no way around it. That’s part of the new rules so they don’t rape you while you are trying to take advantage. I know because I used to do that and you couldn’t use that card again until you were done.

Maybe there’s some protection in those new laws for you. 

Edited by stbugs

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19 minutes ago, stbugs said:

Sucks man but that’s why they do that. I feel bad, but I would bet that according to the letter of the legalese that you didn’t pay it all off on time and thus you owe interest over those 0% years. Those things suck because they are built to get all the interest back. It’s not a charge interest on the balance going forward it’s a you didn’t pay it all so we backcharge all the interest.

I don’t get why you weren’t getting more statements though that doesn’t make sense or you aren’t telling the whole story. You got them while paying it off so did you just ignore them after you paid it off?

Also, you need to check your statements going forward. They list out all the “programs” and now the new credit card laws make CC companies pay down the highest interest automatically. They did that for 0% transfers so that any new spend got whacked as they would pay down the 0% stuff first and there was no way around it. That’s part of the new rules so they don’t rape you while you are trying to take advantage. I know because I used to do that and you couldn’t use that card again until you were done.

Maybe there’s some protection in those new laws for you. 

I was enrolled in their paperless / electronic statement program. Back then, I don't believe they sent email reminders, you just had to remember to pay them each month. I still get emails from them every other day about weekly sales, new products, their rewards program, special sales, service programs, etc. So I know I am still in their system. I have no idea why they didn't just email me about my account at any time. If they did eventually try to notify me by mail, I have a different address now . . . which to me would be even more reason to try to email me.

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1 minute ago, Anarchy99 said:

I was enrolled in their paperless / electronic statement program. Back then, I don't believe they sent email reminders, you just had to remember to pay them each month. I still get emails from them every other day about weekly sales, new products, their rewards program, special sales, service programs, etc. So I know I am still in their system. I have no idea why they didn't just email me about my account at any time. If they did eventually try to notify me by mail, I have a different address now . . . which to me would be even more reason to try to email me.

I’m surprised you didn’t look at the last statements online. You will now, so that’s a lesson learned but I always used to keep a copy of that last $0 balance statement if I was closing an account or a membership (like a gym). It was a nice piece of mind.

I think your only hope is the new credit card laws that were changed to avoid these situations or maybe you actually got screwed by that in that you were paying extra money to the non 0% stuff. Either way you probably didn’t ever pay the thing off by the letter of the law and you aren’t going to get much help.

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1 minute ago, stbugs said:

I’m surprised you didn’t look at the last statements online. You will now, so that’s a lesson learned but I always used to keep a copy of that last $0 balance statement if I was closing an account or a membership (like a gym). It was a nice piece of mind.

I think your only hope is the new credit card laws that were changed to avoid these situations or maybe you actually got screwed by that in that you were paying extra money to the non 0% stuff. Either way you probably didn’t ever pay the thing off by the letter of the law and you aren’t going to get much help.

I guess my question would be conceptual in what happens in situations where my side of the story is impossible to document and the other party is now essentially the 3rd or 4th party removed from the initial agreement and paperwork. IMO, I can't prove my case, but they don't have records that go far enough back to prove it either. I am sure they will say they don't need that and it's not their problem.

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DISPUTE DISPUTE DISPUTE!

Don't give these people an inch. Don't give them a dime. Nothing. The burden is ON THEM to PROVE that you legally owe this debt.

If the debt is more than 6 years old then it might be past the statute of limitations, in which case the debt collector can POUND SAND.

Don't offer a settlement until they show you proof that you owe what you say that you owe.

Creditboards is a good place to start.

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4 minutes ago, Joe Summer said:

DISPUTE DISPUTE DISPUTE!

Don't give these people an inch. Don't give them a dime. Nothing. The burden is ON THEM to PROVE that you legally owe this debt.

If the debt is more than 6 years old then it might be past the statute of limitations, in which case the debt collector can POUND SAND.

Don't offer a settlement until they show you proof that you owe what you say that you owe.

Creditboards is a good place to start.

I am a neophyte on some of this stuff. When does the debt get branded / date stamped as having occurred? On the purchase date? Or as long as a company keeps invoicing it? Meaning, if the purchase took place 8 years ago but my store credit card account was still being billed monthly, is the debt considered from the most recent statement date? (This is a general question and not specifically directed at you.)

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22 minutes ago, stbugs said:

I’m surprised you didn’t look at the last statements online. You will now, so that’s a lesson learned but I always used to keep a copy of that last $0 balance statement if I was closing an account or a membership (like a gym). It was a nice piece of mind.

I think your only hope is the new credit card laws that were changed to avoid these situations or maybe you actually got screwed by that in that you were paying extra money to the non 0% stuff. Either way you probably didn’t ever pay the thing off by the letter of the law and you aren’t going to get much help.

As for the first part, at the time of my final payment for 0% financing, it never even dawned on me that I hadn't paid off the total purchase price. In fact, with the extra payments I had already paid, I was pretty sure I was already done but made another payment just to make sure. If I remember correctly, I wrote down the remaining balance (which wasn't that much) and made another online payment shortly thereafter to pay off the remainder on my account . . . but apparently that payment fell in between the time after my payment was made but before new statements were generated. So the giant balloon charge for the accumulated interest hadn't hit my account yet.

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25 minutes ago, Joe Summer said:

DISPUTE DISPUTE DISPUTE!

Don't give these people an inch. Don't give them a dime. Nothing. The burden is ON THEM to PROVE that you legally owe this debt.

If the debt is more than 6 years old then it might be past the statute of limitations, in which case the debt collector can POUND SAND.

Don't offer a settlement until they show you proof that you owe what you say that you owe.

Creditboards is a good place to start.

this guy knows things

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Send them discovery requests. You may have to ask the court's permission to do so, but undoubtedly the court will grant it. Then get everything they have. 

Go over it in detail. And then challenge them on everything, including lack of notice, incorrectly applying payments, whether the entity that owns it now has proof that they actually own the debt, etc.

Make their life really painful. 

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1 hour ago, Anarchy99 said:

I guess my question would be conceptual in what happens in situations where my side of the story is impossible to document and the other party is now essentially the 3rd or 4th party removed from the initial agreement and paperwork. IMO, I can't prove my case, but they don't have records that go far enough back to prove it either. I am sure they will say they don't need that and it's not their problem.

I’ve never been involved in something like that so I have 0 clue what the outcomes could be. I can’t imagine it’s good for your credit no matter what the outcome. 

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2 minutes ago, GroveDiesel said:

Have you checked your free credit report to see if it was on there and from when?

Yeas.  A full report should show every month whether you were current or not.

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Also, definitely listen to that the credit boards tell you. There are very specific laws about what documentation they need to have a valid claim, what was allowed to be charged, who has to notify you when and in what manner, and how your responses affect things. 

What you should absolutely not do is communicate with them in any way until you understand all of that. Depending on how you addressed the idea of them offering you a deal, you may have already given up some leverage.

There's specific information that they are required to provide you in writing to prove that the debt is valid and that they are the legal holders of that debt. You need to request that in the proper manner and then request that all future correspondence be via mail.

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3 hours ago, Anarchy99 said:

One of the issues here is that originally Best Buy had their own financing group / store credit card. Then they sold that off to another lender. Then that financing program got bought out by Chase. And now the law firm going after me bought out my account. So there are multiple companies involved and I don't believe there is anyway to "prove" my case as I don't even think the records from years and years ago are still available.

You don't have to prove anything.  As @Joe Summer noted, the plaintiff seeking to collect money from you has to prove it is entitled to that money.  If there are no records, and no witnesses to testify, you [can, should, might ...] win the case.  I would not trust that they sent you everything.  If you want to fight it, send a formal letter to the lawyer asking for all documents in the plaintiff's possession or control relating to the alleged debt.  This includes all email, correspondence, any records - and particularly includes any records relating to the sale or purchase of the debt.  Remember, you bought something on credit from Best Buy.  You borrowed money from the Best Buy finance company.  But you are not being sued by Best Buy or its finance company.  If the company suing you is to prove its claim, its right to money from you, it needs to show an entire chain of ownership of the debt.  A copy of an account statement or invoice from some finance company that is not in the lawsuit proves next to nothing.  The complex, convoluted nature of these debt transactions is your friend, not your enemy in these cases. 

 

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these debt collectors buy debt to try and.. essentially.. extort from you what they can.

you might have owed the Best Buy finance company $1000 (for example) but this debt collection agency bought the debt from them for pennies on the dollar. their sole aim is to scare you in to paying over & above what they bought the debt for (likely less than $100). 

the finance company has washed their hands of it. now it's with a goon squad who will use any and every shady tactic they can think of to make you pay.. as it's nearly pure profit from their perspective.

 

years ago i rented a vehicle, paid extra for the insurance just in case, got in to an accident and found myself in a similar situation to yours. insurance covered the claim and i didn't have to pay anything out of pocket (i later found out) but months after the accident i started getting calls from some scumbag debt collector who told me i owed many times more than the repair cost to the other vehicle... he would call every day, scream obscenities at me, read off names and addresses of my family telling me that he would call and tell them what a piece of #### i was (surprise!), threaten to serve me at work in front of my boss, threaten to get me fired, etc.

the guy had no authority at all. it was all just a strong arm tactic. once i said "you'll have to talk to my lawyer" (which i did not have) the calls & threats stopped.

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2 hours ago, Anarchy99 said:

When does the debt get branded / date stamped as having occurred? On the purchase date? Or as long as a company keeps invoicing it? Meaning, if the purchase took place 8 years ago but my store credit card account was still being billed monthly, is the debt considered from the most recent statement date? (This is a general question and not specifically directed at you.)

Generally speaking, the clock starts at the date of your last payment. However, the clock can be "restarted" in certain circumstances (such as if you make a promise to repay the debt or agree to a repayment plan).

That's why you don't want to make any offers to the debt collector. They can refresh the debt and then you'll be screwed.

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The first thing you need to do is get copies of your credit report. That will tell you if Best Buy ever reported you as being delinquent on your account.

The second thing you need to do is contact Best Buy's credit department and demand that they provide you with a copy of every statement they ever sent to you, as well as the date that they sold the debt to the debt collector.

Check this page or this page to find out the statute of limitations for your state.

Anyway, follow the advice at creditboards. Those people know what they're doing.

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Fair Debt Collection Act. Look up the notice provisions and print them out. And actually I think the seller of the debt is supposed to give you notice they transferred it. The money they spend on an attorney won’t be worth it.

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