What do I do about this collection agency nightmare ?

Question

Ok so in 2011 I opened up a cell phone plan through T-Mobile through the local RadioShack. I drove about halfway home and realized the service was garbage. I took the phone back the next day and returned the service (there was a 14 day guarantee). Easy as that right?

Yesterday I get a notice from my credit monitoring app that there is a new collection. I call the collection agency and they say I owe T-Mobile. I immediately call them and they have no record of me canceling and they have since sent it to collections. Also said that it was radioshacks fault and that there is nothing they can do. I call RadioShack and they say they canceled it and there is nothing they can do. Meanwhile the collection agency is threatening me saying I owe 130 some odd dollars and that my receipt showing return means nothing. Yes it took almost 3 years for me to find out about this and now I am in a awful situation. Just want my credit report fixed which is worth well more than the $130. What do I do?

Answer 1

You are about to learn why you should always cancel accounts in writing and insist on written confirmation that the account was closed and 0 balance.



This kind of thing is very common with cell phones. Even if you cancel the account directly with the cell phone service, they often "forget" to terminate some small fee like insurance, that continues to bill and generate a junk account. These junk accounts eventually get sold off to collection agencies. Often the collection agency doesn't even bother to call to collect. They wait till you try to apply for a mortgage or something and need to clean up your credit report.



Assuming that you have checked your credit report and this is showing, you can either live with it on your credit for the next 4 years -- it will count less in your score as it gets older. Or you can negotiate a settlement -- which will not remove the item or improve your credit score.



My suggestion is that you send the collection agency a certified, return receipt letter disputing the debt. Indcate that service was cancelled within hours and you have a receipt showing that. Tell them to cease all contact and to remove the invalid item from your credit report.



They may not actually remove the item but they will have to stop contacting your.

Answer 2

Let's start with what you don't do. You don't call a collection agency, ever, for any reason. Once you say even one word to them on the phone, you give them the total ability to lie and say that you said whatever they want to say that you said. For example, they can say that you agreed to pay $5 million or any other amount instead of what you actually owe (or don't owe).



If you need to tell them anything, or to ask them anything, then you do it only in writing, without speaking.

Answer 3

If Radio Shack said they canceled the service, tell them you give you a copy of the cancellation or you'll file a complaint with the Federal Trade Commission at 1-877-382-4357 Give them 10 minutes to decide.

Answer 4

Start making payment plans