Are you getting endless calls, demanding letters, or have you discovered American Recovery Service on your credit reports? If so, you’re in the right place.
American Recovery Service (ARS) is a large and aggressive, third-party collection agency. They specialize in repossession portfolio management, which encompasses the financial services industry, charge off accounts, and auto deficiencies.
There’s also reports of them servicing other types of debt including retail accounts, among others. They’re headquartered in Northern California, and were established in 1986.
If you’re currently dealing with the phone calls, letters, and negative credit information, the first item we need to share is the Fair Debt Collection Practices Act (FDCPA). This is federal legislation passed with the intention of regulating the debt collection industry.
It’s worth reviewing in detail at your convenience. In short, it says debt collectors are supposed to be straight-forward and honest. Along, with giving you the respect and dignity, every human being deserves.
Will Paying Off ARS Collections Improve Credit?
You’d think so, right? It makes sense, and seems reasonable that it would. But nope, as of today 2017, it won’t. You see, the only thing that happens when you just pay off collections is the status of that item is changed on your credit report.
It’s changed to a paid collection. This is still a negative, damaging, and derogatory item to have on your credit reports. Moreover, it’s guaranteed to drag your credit score down.
Anthony Sprauve, a spokesperson for FICO, says collections on your credit report can damage and drag your credit score down by up to 100 points. That’s huge! Look, the solution for bad credit scores is to remove the negative items on your credit report.
These dings and blemishes are the real credit score killers. And for some folks, after first performing the due diligence which will be sharing in a moment, may discover paying off collections is an effective way to clean credit report dings, blemishes, and remove negative items.
In addition, to the endless phone calls, threatening letters, and negative information on your credit report. American Recovery Service can also charge your account interest fees and collection fees to inflate the balance.
If they’re unable to collect payment, they have two options. First, they can sell the rights to your account to yet another debt collector. This new debt collector will begin calling you, sending letters, and they’ll report even more negative information on your credit reports.
The second option is they can sue you. Yup, they can file a civil lawsuit against you, and from the official American Recovery Service website it looks like they have the resources and capabilities to do just this.
Their goal is to win a judgement. Because then they’ve got you by the short and curlies. Not only will your credit be decimated, and virtually overnight.
Depending on your state of residence, because every state has unique laws, so for full details check out your local legislation. Judgements can result in your wages being garnishes, liens being placed against you and or your property, and even asset seizure.
American Recovery Service, Inc.
P.O. Box 4917
El Dorado Hills, CA 95762
Phone number: 1-800-398-6480
Consumer Help Dealing With ARS Collections
1. Request Debt Validation
Let’s get down to business, and discuss in detail, how to deal with collection agencies. The very first step for every consumer, dealing with any debt collector, is to first request debt validation on their alleged account.
This is most effective if done in writing and sent using certified mail with return receipt requested. This way you have evidence they received your validation request. By the way this is your consumer right granted by the FDCPA.
You see, American Recovery Service is required to respond within 30 days of receipt by providing you with the documents, evidence, and paperwork that proves this is your account. These documents will also show you who the original lender was, the dates of account activity, total balance, and more.
If they’re unable to validate your account, then in compliance with the FDCPA, the debt is forgiven. In other words, you’re no longer legally responsible for payment. Further, they’re supposed to contact all three credit bureaus to have them start getting collections removed from credit report files, regarding this account.
2. Statute of Limitations
If your account is validated, we next want to review this paperwork in detail. We’re looking for you last date of account activity, this most likely occurred with the original lender or creditor.
You see, you’re not legally responsible for repayment of most types of consumer debt, forever. Our state lawmakers decided exactly how long we are legally responsible for repayment with the statute of limitations. And this does vary by state, so for full details investigate your local listings.
Generally, this time window is about seven years from the first date of delinquency. Once this time expires, then the debt is legally forgiven. This is what our state lawmakers decided.
Beware. One of the most common fines and violations of the FDCPA by the debt collection industry is to re-age consumer accounts. This is frequently done illegally and obviously so they can continue to attempt to collect payment.
And while the statute of limitations time window doesn’t apply to every type of consumer debt, it does apply to most including: repossessions, charge off debt, auto deficiencies, medical collections, retail, utilities, and many more. The few exceptions include federal income tax, and defaulted federal student loans.
3. Negotiate a Settlement Agreement
If your account is validated, and it’s within the legal time window, our next step is to negotiate a settlement agreement directly with American Recovery Service. There’s two parts to your agreement.
First, always negotiate to settle for less than the total balance. This is fundamental when paying off debt in collections, because often you can pay as little as 15% up to about 45% of the total balance. This is standard operating procedure and they’ll be happy to accept a settlement for less.
The second part of your agreement is mission critical. You must get American Recovery Service to agree that in exchange for your payment, they’ll stop reporting your account information to all three credit bureaus.
If we neglect this part of our agreement, we’ll get stuck with that paid collection on our credit reports. And the reason we won’t use the pay for delete approach is simply because that’s an internet myth.
If you’re not familiar, this is where you demand American Recovery Service or any other debt collector first delete the negative item from your credit reports, and then you’ll pay. And oh how wonderful it sounds.
Look, we’ve been helping folks personally for over ten years, and we’ve yet to hear of one person or one collection agency ever agree to this. Despite, seeing it evangelized like gospel all over the internet. And it’s for very obvious reasons this is wishful thinking to those familiar with the debt collection industry.
Nonetheless, you’re very welcome to try. However, it’s much more pragmatic, and realistic to simply request they stop reporting your information to the credit bureaus, in exchange for payment. This they will agree to this.
4. How To Clean Up Credit Report
In this final step, we’re talking about how to dispute items on credit report files. This is how we’re going to remove American Recovery Service and the ARS collections item from your credit report.
We’re going to need more of your consumer rights, and specifically those granted by the Fair Credit Reporting Act (FCRA). This federal legislation is what empowers every citizen to dispute and challenge any item on their credit reports, so long as we believe that item is incorrect, misleading, or made in error.
And yes, we’re going to dispute the ARS collections item. We can file our credit report dispute online, over the phone, or by mail. Once the credit bureaus get it, and they first have to deem it valid, which is another conversation for another time and place.
So make sure to sign up for our free newsletter for more help with credit with Dan Willis, and join our congregation. Once the credit bureaus get your dispute and deem it valid, they’re required to investigate the item.
They’ll call it a re-investigation. Nevertheless, they’ll contact American Recovery Service and ask them to verify your account. And any of the relevant details.
As per your settlement agreement, they won’t verify your account during the credit bureaus investigation. In compliance with the FCRA, this means the credit bureaus will have to remove this negative item from your credit reports. This is how to clean up your credit history dings, blemishes, and remove negative items, and legally.
Listen, if you’ve discovered American Recovery Service the hard way, there is hope. And it’s imperative that we take action to fix your credit, after all can you or your family really afford to just sit around for seven long, expensive, and embarrassing years?
Chances are you have a repossession item on your credit report, and or a charge off from the original finance company. Check out these two article’s for more about how to remove repossession from credit report, and how to remove charge offs from credit report.
In addition, we’ve got to take action with this collection debt, and before it snowballs into a bigger problem and possibly a lawsuit. However, even if you have a judgement against you, there is hope with wise action.
Listen, your credit score is a lot like your Grade Point Average (GPA) in school glory days bygone. It doesn’t matter if you’re acing all your courses, if you’re failing underwater basket weaving, because this negative mark is going to ruin your overall GPA.
This is also true of your credit score. And why it’s of high priority to clear credit history dings, blemishes, and remove the negative items. We encourage our members to consider professional, legal, and legitimate credit restoration companies to help with this.
In 2016 alone, over 9 million negative items were removed from consumer’s credit reports. One of the best firms is the Credit Pros. They’ve helped client’s successfully remove collections, late payments, charge offs, judgements, liens, and many more negative credit report items.
Get a free credit consultation with a certified FICO professional by calling toll-free 1-877-418-7596. And for more tips, techniques, and strategies about how to fix credit rating with Dan Willis, sign up for our free newsletter and join our congregation.
Get a FREE Credit Consultation