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It says here: I read somewhere that typically after you have fallen behind on payments, it takes between 90-180 days for your original creditors to write the debt off and turn it over to collection companies. These collection companies buy information from creditors as to who had debt that was written off by the original creditor and then they try and bully you into paying them. Realize though that once the original creditor writes off the debt, they turn it over to their insurance companies and get reimbursed up to 3 times the original debt. This means that your debt no longer exists. Is this true and the debt can be dismissed in this case?
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Bankruptcy Attorney serving Burbank, CA
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Law Office of Mark J. Markus
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If you are referring to what happens to a debt when you file bankruptcy, it depends on the type of debt and how it was incurred. If you're talking about a credit card debt, as long as the charges were not incurred through fraud (i.e. with no intent to repay) then it should be dischargeable in a bankruptcy case. Your use of the word "dismiss" is very confusing, but I believe that answers the question I think you are asking.
It is completely untrue that once a creditor turns over its account to a collection agency that the debt no longer exists.
Answered on May 06th, 2017 at 1:17 PM