La Jolla, CA – May 5, 2015 –

Q. I checked my credit report and there are creditors I don’t recognize. Who are they and what can I do about this?

A. It’s a good idea to check your credit reports from all three major bureaus annually. You can get your credit reports for free from Equifax, Experian and Transunion by visiting here. Deciphering your credit report can be difficult if you have an extended credit history. Even more difficult is figuring things out if you have fallen behind on your payments and had your credit card debt sold to a third-party debt buyer. Some of the most common credit card debt buyers are Portfolio Recovery Associates, Midland Credit Management, CACH, Cavalry SPV, Asset Acceptance and LVNV. These companies buy debts (often for pennies on the dollar) from original creditors that have determined it unlikely that they can collect from you.

The third-party debt buyer will then start its own collection efforts. Often, that includes reporting the debt on your credit. If you see these companies on your credit report, the first thing to do is make sure they have a legitimate reason to be reporting this debt. If the debt is valid, you can count on the debt buyer to get aggressive in collection efforts. This can include phone calls to you and your relatives, mail offering settlements and notices from law firms that they intend to sue if the debt is not paid. If those efforts fail, it is likely that the third-party debt party will file suit against you.

If you are served with a lawsuit, you have limited time to take action. You can try to negotiate with the lawyer representing the creditor. If you cannot do that, you need to file an answer to the lawsuit with the Court. There are a number of self-help websites available. However, Google is not always the best legal resource. An attorney with experience in defending collection lawsuits may be a better idea. Yes, attorneys cost money. But it may be your best investment if your attorney is able to negotiate a settlement or, even better, gets the lawsuit dismissed. Debt buyers may not always have the proper documentation to prove their case. If that’s the case, you may be able to defeat their claims in court.

Going back to the original question, it is important to know what creditors are reporting. Being proactive about your credit could save you money and time. Perhaps most important is the peace of mind you will have in knowing what is or isn’t on your credit report. This can also help you plan future purchases and fix problems before you need to utilize your credit.

Daniel R. Gamez, an attorney focusing exclusively in debt settlement, is licensed to practice in all state and federal courts in California and Texas. Mr. Gamez owns and operates the Gamez Law Firm in La Jolla, CA. For more information, please contact Daniel Gamez at 858-217-5051, or visit