Consumer Protection Law
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Bad debt means the creditor has been unable to collect the debt. Placed for collection means the debt has been sent off to a collection agency to try and recover. And skip means that the creditor has been unable to reach the debtor (e.g., if you have not responded to their letters and calls, or didn't leave a forwarding address after moving).
Collection just means that they sent the matter to a collection agency, it doesn't necessarily mean a lawsuit was filed. If a suit was filed, you would have to be served papers notifying you of the suit, also.As far as whether they can still sue you, that depends. What state is this in? Also, are we talking about credit card debt?
I'm sorry, I'm working with several customers at one time. I am typing as fast as I can - I promise. :-)Washington State has a 6 year statute of limitations (time limit) to file suit, meaning yes, they could still file a lawsuit against you to try and collect the debt. The creditor wouldn't be able to freeze the savings account take the money without first getting a court judgment.
If these creditors or creditor is actively pursuing you, and you have the means to pay something, then it's worth contacting the collection agency the debt has been assigned to and see if you can negotiate an agreement. By the time the debt goes to collection, they're usually willing to accept much less than what is owed. However, most also want full payment of their offer (e.g., if you owed $10,000, they may be willing to settle for $1,500, but not be willing to accept a payment plan). You won't know until you call. If you're in over your head in debt with no possibility of paying anything, I would suggest consulting a bankruptcy lawyer in your area about filing -which can potentially wipe out your unsecured debt (like your credit cards) and give you a fresh start. It will also stop creditors from harassing you once you file.Your credit report will show you the last month you made a payment on the account.
Well, then as I said, contact the credit card company -they should be able to tell you when you made your last payment. And, if the creditor (or a collection agency, on behalf of the creditor) is pursuing you for the debt, then you either a) try to reach a settlement with them, or b) take a wait and see approach and do nothing. I wouldn't advise that --as there is a chance they sue you and get a judgment. And then you'll end up paying the credit card amount, plus court fees, plus legal fees.If you pay them (even if you pay them a reduced settlement amount) your credit report will be updated to reflect that the debt was paid.
Most collection agencies won't settle for anything less then about 45-50% of the original debt, so I wouldn't propose something ridiculous, like 10% of the balance, as they won't take you seriously. However, I'd make an offer in the 30-35% range at least as a starting point and see if they counter. Again, the more you can pay all at once, the more attractive any offer you make will look to them.You shouldn't need a lawyer unless you are sued for the debt, in which case, you would want an attorney who does civil litigation.
You would want to speak to a consumer protection attorney, in that instance.
I've answered your questions as asked, we seem to be going around in circles at this point. I am going to opt out and open this question up to other experts, perhaps they will be able to provide you the information you are seeking. Your deposit remains in place. Good luck to you.