Help! A bill collector is coming after me

  @Money November 20, 2013: 5:18 PM ET
bill collector
NEW YORK (Money Magazine)

Must I pay a bill collector $134 for a shipping charge? A (now-closed) store I shopped at was to pay it. -- Elizabeth, Carlisle, Mass.

You have 30 days after a collection agency has contacted you in writing to ask for proof of the debt, says John Ulzheimer, a contributor to CreditSesame.com.

Should that month have passed, try negotiating with the shipper.

No luck? Your best choice (albeit unfair) is to give in. If the company still owns the debt, paying it may keep the claim off your credit report. If the shipper has sold the debt, though, the claim will stay even if you pay.

Why worry about a collections claim? Having one could ding an 800-plus FICO score by 200 points, raising rates with lenders and maybe insurance premiums too.

Related: Can my 80-year-old dad give me money from his IRA?

Your score will start to recover after a year, but Ulzheimer says it is not likely to exceed the mid-700s for the seven years the claim is listed. To top of page

Send your questions to Ask the Expert.


Join the Conversation
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.41%4.44%
15 yr fixed3.33%3.31%
5/1 ARM3.34%3.55%
30 yr refi4.39%4.41%
15 yr refi3.31%3.30%
View rates in your area
 
Find personalized rates:
Rate data provided
by Bankrate.com
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.