How does paying off collections and judgment through escrow work?
I am trying to buy a house but processor said i have to pay off all collections and judgement on credit report. I went on experian today to dispute the items. My problem is, I have a judgment of 4995 from Atlantic on my report, but further reserach led me to the law office that filed it. I contacted them today and they say they will settle with me for 5k because it is now 6500. Should I pay off the settlement to the collector of the law office and receive a receipt or does escrow pay the courts directly? Also, if the judgment is only $4995 and the office tells me it is $6500 now, will they continue to pursue me for the remaining $1500 if we have escrow payoff the court? Does the escrow officer contact the court or do they contact the law office like I did and get the final balance due or do they pay what is reported which is only $4995. I would have called the escrow office for answers but they were closed by the time I got off with the law office and they are demanding the settlement in person for Monday morning, otherwise they will demand more. What is the best thing to do to make sure they don't screw me again because I was not properly served in the first place and they won by default. Rep from office threatened to order a Marchall to wipe out my bank account. These people are ruthless when I am voluntarily calling them to settle.
Best Answer
This is a real mess....first realize that you are dealing with really vicious predators here....I hope that you did not tell these people that you are trying to clear your credit rating for a new mortgage because if you did they will use this info against you to extort every penny they can squeeze out of you.
- If you can afford one...hire an attorney to deal with these vultures...If you can't, stay off the phone. Keep all communications in writing.
If you were sure that you were never served for this lawsuit, then here is template I made:
Many bottom-feeder debt collectors have figured out that if they "accidentally" serve you a summons to an old/incorrect address where they know that you won't be there.....that you will be a "no show" on the court date because you weren't aware of it.....Then.... boom....an automatic default judgment is assessed against you.
It is illegal to deliberately serve someone at an incorrect address. This tactic is called a "sewer service" summons delivery. If you can document that you were improperly served, you may be able to get this judgment voided.
Go to the clerk of the court of the court that granted the judgment. You want copies of all documents in the case against you. You want to examine the 'proof of service' documents to determine who/where service is claimed to have been performed.
If you are sure that you were not served: Send a letter via certified with return receipt (Not regular mail) to the law office and state: I am requesting official validation of the alleged summons that was served to me, to include:
- The full name of the person who served the summons
- The full name of the person who signed for the summons
- A copy of delivery notice showing the signature
- The exact address that the summons was delivered to - The date and time of delivery.
Receipt of this letter is being officially time stamped by the USPS. Refusal to validate will be documented.
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If you decide to pay them, get all terms of any settlement deal you reach with debt collectors IN WRITING BEFORE you give them your money. This letter should state the settlement amount and that the account will be settled/paid in full upon receipt of this amount from you. Never accept settlement deals over the phone that are not backed up in written terms. If you don’t, the debt collectors will deny that any settlement was ever made once they get your “settlement” money and will come back demanding more money from you.
