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Hello. I had an S-Corp that I formed in 2005. At that time I obtained a business credit card from B of A. Long story short, things turned sour and my corporation had to walk from the business credit card.
I don't see any impact on my personal credit (it is at ~720) but the collections people are telling me that I am PERSONALLY liable for the debt and I recently found the infamous "FIA CSNA" inquiry on my personal credit. Can they do this?
To be more specific, can they come after me personally.
I do not know to much about this area but I guess it would depend on your contract witht the CC compay and if you protected yourself by buying a LLC title for your company
How did you have the company set up? Was the business it's own entity, seperate from you?
When you formed your corporation and obtained a business credit card from Bank of America, you must have given your personal details and put in your signatures on it as the owner of the company. So your personal details are with the credit card company and it means that you are liable for the debt. Since now your business credit card has already been closed, the card company can report it to the CRAs who in turn can list it on your personal credit report.
I too think that Anthony is correct. You can send a debt validation letter to FIA CSNA to find out whether or not they are authorized to collect the debt. If they validate your debt, you can try to come to a pay for deletion agreement with the collection agency. However, if they cannot validate your debt within 30 days of receipt of your letter, you may send a dispute letter to the credit bureau, telling them that you do not agree with the listing.
It was an s-corp. I was an officer of the company and set up the corporation as its own separate legal entity. The corporation obtained credit on its on merits. To illustrate, the rate on the credit card was 25.99%, but on my personal credit cards varied between 7.99-9.99%.
I don't see how they can go after me. They are stating that I am the guarantor of the debt and I see that NOWHERE in my paperwork. Aside from the FIA CSNA inquiry, my personal credit has been unaffected.
After reading your most recent post, I don't think that they can go after your personally, is there anything left at the company that they can sheriff sale and take for the money that the business owes them?
The business is done. I sold my office furniture and supplies in 2007. This site has a lot of useful tools I noticed for getting ahold of creditors and calling them out. My guess would be that these are scare tactics.
Is it legal for them to lie to collect a debt? They are threatening to send me to their lawyer to have them put a lien on my house. I really don't see how they can do that since the debt was under the s-corp and not under my social. I WAS offered some credit cards for my corporation where I WAS the guarantor and the rates were much more favorable than the one I ended up getting. Thoughts?
Yes it is illegal for them to threaten something that they do not intend or have the legal right to do, you should visit the Fair Debt collection website, all the laws are there.
FDCPA does not apply to business debts.
Do you have a copy of the orginal credit agreement?
Morningstar-
Perhaps, but the debt belonged to my CORPORATION. They are going after me PERSONALLY. I cannot seem to locate the credit app from two years ago so I guess I am going to have to go with a debt validation letter and see what their next move is.
UPDATE:
I've asked for PROOF that this I am personally liable for this debt and they are REFUSING to provide this-- they're only sending a settlement offer. I asked them multiple times and they said "We are not sending you a copy of your application".
What's my next step? How do I dispute the debt against me personally? Help!
Which entity did you contact when requesting a copy of the application--the original creditor, or the CA?
Un-Incorporated
At this point you need to contact your local AG or someone at the FTC and get the officail story on this matter. Since your house is on the line I might also look for a lawyer that offers free consultations and ask his/her advice
Hi Un-incorportate
Since you have already requested them to provide you with proof that you are responsible for paying the debt, you can also send a DV letter, because the CA cannot rule out this letter and until and unless they validate the debt in writing, they cannot force you to pay back the debt. If they still disturb you, without validating your debt, complain against them to the FTC and the AGs office.
As Mary said, you can send a debt validation letter to the CA. You can send a DV letter although FDCPA does not apply to business debt, because the CA is targeting your personal credit report and personal credit report falls under FDCPA. However, as you said in your first post, there is only a hard inquiry on your credit report, which means that you may have applied for a new line of credit from them. I don't think they are pulling your credit report for listing your corporation debt in your report. So I don't find any need to worry. However, you should consult an attorney regarding this.
Still who is suing you the Original creditor or a collection agency? I would not do anything until the debt is validated. I would also probaly talk to an atty concerning your rights. I can not see how if the debt was a corporation debt how they can sue you personally. You would think it would have to sue the company. Let us know how this works out for you.
Definately make sure they validate before you pay anything, also see if the SOL is still in effect.
yes Validation is always for the very best and so is looking up your staes SOL. If you need help finding it just ask and e can get it for you.
validation is the only way to make a company show that they own the debt but as much as we say it, some consumers feel completely helpless against these collection agencies and end up paying a debt that they probably should not have. Education about the laws is the only defense.
OOPS HIT THE BUTTON TOO SOON. i AM STILL WONDRING IF HE IS EVEN RESPONSIBLE FOR A COMPANY DEBT.
I don't think that he would be because the corportation would have it's own tax identification number unless he used his social security number for tax reporting purposes on the account, but it does not appear to be that way from what I have read.
What I am trying to figure out on this one is if it was his won company.
Prsonal Liability
You are liable. If you had the application you could see it. But, they are full of it. They probably will not sue and they can't take you house. They can get money from your bank accounts IF they get a judgement. Hang Tough.
Thanks for the advice but you have to relize some collectors will take things 100% of the way and do anything they can to get their money. They can not take the house as you say but they can attach wages in some states and aas you mentioned bank acccounts. I have seen this happen before.
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zMPqBV Thank you for your post.Much thanks again.