Without a doubt, constantly receiving calls and letters from a debt collection company like Portfolio Recovery Associates can be very stressful. After all, no one expects to be in trouble with debt.
Now, if you find yourself in this situation, don’t succumb to bullying. It is important for you to know that when it comes to dealing with a debt collector like Portfolio Recovery Associates, you have certain legal rights and protections. And that is exactly what we are going to talk about in this article, as well as other details.
- 1 Who are Portfolio Recovery Associates and why have they contacted me?
- 2 How does Portfolio Recovery work?
- 3 Questionable Collection Tactics Commonly Used by Portfolio Recovery Associates
- 4 How many complaints are there against Portfolio Recovery Associates?
- 5 Rights and protections under the Fair Debt Collection Practices Act
- 6 Common Questions About Portfolio Recovery Associates
- 6.1 I have been sued by Portfolio Recovery Associates. You may be able to afford me to make a deal with them. Should I pay off my debt?
- 6.2 If Portfolio Recovery Associates can get a judgment, will they be able to garnish my wages?
- 6.3 Portfolio Recovery Associates refuses to give me anything in writing. This is normal?
- 6.4 Will Portfolio Recovery Associates remove negative information from my credit report once I pay off the debt?
Who are Portfolio Recovery Associates and why have they contacted me?
Many people are surprised when they are notified of a collection lawsuit, and even more so when they see that the plaintiff is a company called “Portfolio Recovery Associates”. The surprise is probably based on the fact that they have never heard of this company and that they do not recall making a purchase or obtaining a loan from them.
If you have no idea who or what it is Portfolio Recovery Associates, you’re not alone. Many bad debts are bundled, sold, and resold to multiple third parties, including bad debt buyers like them. To help you learn a little more about this company, here is a brief summary of who they are.
Since its inception in 1996, Portfolio Recovery Associates has earned a reputation as a aggressive debt collection company that routinely uses questionable and unethical collection practices.
For example, many consumers have filed complaints with the Office of Good Business Practices and the Consumer Financial Protection Bureau alleging serious violations of the Fair Debt Collection Practices Act (FDCPA). For example, consumers have highlighted the use of false or misleading information in an effort to collect delinquent debts., as well as a persistent negligence with its legal obligations, such as the verification of debts at the request of the people involved.
Direction: Portfolio Recovery Associates
120 Corporate Blvd
Norfolk, VA 23502
Phone number: 800-772-1413
How does Portfolio Recovery work?
Portfolio Recovery Associates collects delinquent debts from financial services companies such as banks and credit unions, as well as many retail companies that offer credit. Unlike many third-party collection agencies that collect debts from creditors who still own and control consumer accounts, Portfolio Recovery is a debt buyer. That is, when they contact consumers about a delinquent debt, it means that the bank or creditor has made a business decision to sell the debt, and the right to collect on the account has transferred to Portfolio Recovery.
Questionable Collection Tactics Commonly Used by Portfolio Recovery Associates
Here’s an overview of some of the highly questionable and problematic tactics used by debt collectors working on behalf of Portfolio Recovery Associates when contacting consumers.
- Use of inappropriate and foul language during phone calls
- Calls to consumers before 8:00 am or after 9:00 pm
- Unfounded threats like saying they can “destroy” your credit or that they can arrest you for breaking the law
- Call consumers at their workplace
- Contact consumers several times a day or week
If you have been contacted by Portfolio Recovery Associates and have been subjected to some or all of these questionable tactics, you may be able to take legal action against the company and recover damages.
How many complaints are there against Portfolio Recovery Associates?
For December 2019, BBB had shut down a staggering number of 1342 complaints against Portfolio Recovery Associates in the previous 3 years, with 351 closed complaints in the previous 12 months. Most of those complaints cited problems with billing and collections, although many complaints also cited problems with customer service and sales. As of February 2013, the Consumer Financial Protection Bureau had closed 11,691 complaints related to the company.
Rights and protections under the Fair Debt Collection Practices Act
As we have mentioned, you have the possibility to turn the table and take legal action against Portfolio Associates. The legal mechanism that allows consumers to initiate legal action is the Fair Debt Collection Practices Act (FDCPA).
The FDCPA is a federal law enacted in 1977 with the goal of protecting consumers from being harassed and threatened by debt collectors using abusive and unethical tactics. Under the FDCPA, a consumer has the following legal rights and protections:
- Dispute a debt and ask the collection company not to contact you anymore.
- Require the collector not to call work.
- Request proof that a debt exists and that the collector is authorized to request payment.
- Be represented by an attorney.
Common Questions About Portfolio Recovery Associates
I have been sued by Portfolio Recovery Associates. You may be able to afford me to make a deal with them. Should I pay off my debt?
You may expect a resounding “yes”, but this is something that depends on the situation. For example, let’s say someone has $50,000 of unsecured debt, and Creditor 1 sues for $5,000 of unpaid debt. Let’s say you are able to settle 75% of the charges. Can you settle if other lenders decide to sue you?
How can this potential problem be mitigated? Our advice is to find an expert who can review your credit report and give you specific advice on a strategy that includes how litigious your mix of creditors is.
Likewise, we advise you not to pay for a credit report. The government allows you to get a credit report from all 3 bureaus once a year for free. Here is the FTC government website that will take you to AnnualCreditReport.com. The key to reviewing a credit report is to look carefully at each entry. Experian has a great article about it titled “Understanding Your Experian Credit Report”.
If Portfolio Recovery Associates can get a judgment, will they be able to garnish my wages?
Three of the main tools collectors like Portfolio Recovery Associates will use to try to claim a debt are liens, liens, and vehicles.
However, it is illegal for a debt collector to make empty threats to sue or garnish your wages. It’s also unlikely that Portfolio Recovery will sue you for a debt you don’t owe or can’t validate.
However, debt collection agencies have been known to summon debtors to court and garnish their wages after a favorable verdict. Next, We leave you a table with information, broken down by state, detailing the impact of a garnishment on your salary.
Portfolio Recovery Associates refuses to give me anything in writing. This is normal?
We don’t know why, but Portfolio Recovery Associates is notorious for not wanting to provide documentation of their agreements in writing. Unfortunately, this is common practice among most creditors. There are three common ways to deal with this:
- Find the company’s email and communicate with them only through that means.
- Record the calls you have with Portfolio Recovery Associates. Keep in mind that you must let them know that the calls are being recorded.
Will Portfolio Recovery Associates remove negative information from my credit report once I pay off the debt?
Until recently (potentially the last 3-6 months), Portfolio Recovery Associates had not been in the habit of doing what we call “Pay to Erase.” That said, we have seen that this has changed and information about it has even been added to the FAQ on their website.
In this sense, the company informs that the account will be considered paid in full or paid for less than the total balance after the final payment is processed successfully. Within approximately 30 days after this, they will request the credit reporting agencies that eliminate the debt-related entry.