Bank Attorney Reveals

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BANK ATTORNEY REV E ALS DEBT FREEDOM SECRETS

Copyright 2004 by John Gliha Page 1

BANK ATTORNEY REVEALS DEBT FREEDOM SECRETS

Published by

DUE PROCESS LTD

an international business corporation

All Rights Reserved. No part of this book may be reproduced or transmitted inany form or by any means, electronic or mechanical, including photocopying,recording, or by any scanning, storage, or retrieval system without permissionfrom the publisher, except by a reviewer who may quote brief passages in areview.

This publication is informational and not advisory. This publication does notconstitute legal advice nor is it an attempt to solicit clients. No person or entityshould act or forbear any act based on the information contained herein. YOUSHOULD ALWAYS CONTACT AN ATTORNEY AUTHORIZED TO PRACTICELAW IN YOUR STATE FOR SPECIFIC LEGAL ADVICE. The information and

materials contained in this publication are provided by the publisher. Themember providing such information and materials represents that suchinformation and materials are true to the best of each such member's knowledge.Any member, governor, manager and agent providing information is notresponsible for inaccuracies with respect to such information and materials andnothing in this site constitutes legal advice by any members, governors,managers or agents.

The purpose of this publication is to inform, educate, and entertain, and it is notintended to support, induce, or condone any activity that might violate local,state, or federal law, nor to deprive any company of its lawful income. Neitherthe author nor publisher or copyright holder shall have any liability to any personor entity derived from any alleged loss or damage arising from the use or misuseof the information contained herein. The author and the publisher have exertedtheir best efforts to ensure the accuracy of the information presented herein, yetthere are no doubt errors which are sincerely regretted.

Copyright 2004 by John Gliha

ISBN: 1-930420-29-3

Printed in the United States of America1 2 3 4 5 6 7 8 9


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INTRODUCTION ......................................................................................................................................... 5

QUICK START CHECKLIST ..................................................................................................................... 6

FREQUENTLY ASKED QUESTIONS ..................................................................................................... 8

WHAT IS YOUR RISK TO COLLECTION? .......................................................................................... 14

QUICKLY END HARRASING COLLECTION CALLS ........................................................................ 18

CREDIT FILE CORRECTION STRATEGIES ....................................................................................... 22

SUCCESSFUL DEFENSES TO COLLECTION LAWSUITS ............................................................. 26

THE MILLION DOLLAR LETTER ........................................................................................................ 26

CHANGE OF ADDRESS ................................................................................................................. 39

FACTS YOU SHOULD KNOW ABOUT SETTLEMENT OFFERS............................................................... 46

UNFAIR AND ILLEGAL BINDING ARBITRATION................................................................................. 49

CORRESPONDING WITH THE CREDITORS ATTORNEY....................................................................... 50

LEGALLYH IMPEDING THE GARNISHMENT OR LEVY.......................................................................... 51

UNDERSTANDING THE FAIR DEBT COLLECTION PRACTICES ACT ....................................... 54

BIBLIOGRAPHY ....................................................................................................................................... 63

APPENDIX.................................................................................................................................................. 64


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INTRODUCTION

Congratulations on taking the first step to learning the secrets of the debtcollection system and how you can apply them to your advantage in resolving

collection problems. This text is a complete course by itself, but it is anintroduction into the technical strategies of Winning The Collection Game; anadvanced college-style curriculum that will help you learn how to resolve yourcredit card debt by forcing the creditors to settle each account for very little ifnothing.

In years past, most attorneys would not assist consumers in resolvingcollection problems, simply because there was no money in it for them. Theconsumer has no money to pay their retainer fee, which can be high because ofanticipated litigation. Attorneys are trained to do only one thing in a debtcollection case, figure out how much you must pay to settle the account.

Recently, a growing number of attorneys and large law firms have begunadopting these strategies and those in Winning The Collection Game , into theirpractices and representing consumers against creditors and debt collectors.These strategies are finding absolute credibility among attorneys of allexperience and educational levels.

This text is the result of ten years or thousands upon thousands of hoursof research in all fifty states. It is an essential learning step in the process of debtelimination, and I strongly recommend that everyone begin here. You havemade a good choice.

This unique course has been published for nearly ten years. Its system ofstrategies has been tested over ten thousand times and has literally created themarket which has become known as debt elimination. No other organization orpublication is qualified to provide the same or similar strategies and many havetried to copy it, making even more outrageous claims than what you might read inthis text. The claims made in this publication accurately reflect the resultsexperienced by our subscribers over the last ten years. Other claims made byorganizations or individuals that are not authorized distributors for Due ProcessLTD have not been shown to be true by our statistics. Due Process LTD has themost comprehensive and time-tested strategies and results in this market.


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QUICK START CHECKLIST

This Abbreviated list is designed to quickly get you started in the right directionas you begin to learn the different stages of Winning The Collection Game.

1. Do not enter into any payment or settlement agreements with any third partydebt collector. You may discontinue making payments if have already beendoing that, and if you intend to use your credit history for one or two last creditapplications in the next several months and your credit is still good, you cancontinue making payments until your contract is closed. After you pass the graceperiod in your credit account, it will begin to appear on as a late payment on yourcredit history.

2. Immediately follow the change of address procedure. In fact, you should

change your mailing address now, and then change it again in two months. Youwill only need to notify each credit account to which you are applying thesestrategies and not everyone who sends you a bill. You will instruct the mail boxservice to forward your mail back to you every two weeks.

3. If you upgrade to the attorney services program, you will have the immediatebenefits of a local attorney or law firm which it trained in the proper application ofWinning The Collection Game. Check with your sales agent at this time todetermine if the attorney services program is currently available in your county. Ifnot, we will work with you in finding a local attorney to join our network andrepresent you if you decide to upgrade. Otherwise, you should assess yourindividual collection risks by listing all personal bank accounts for which you or

the credit account holder(s) are the only signer(s). List all documents appearingon the public records in the county were you have been receiving statementsfrom the creditors that show your name and property. List all automobile titlesregistered in your name in that same county. List all sources of income whereyou receive regular payments from employment or investments in your name andunder your social security number. This is a fairly comprehensive risk and itshows you with property can be discovered by a creditor. While most if not allunsecured credit accounts never permit the creditor to attach real property orautomobiles, it does provide creditors with information about your ability to payshould they decide to sue you. As a general rule, the more property you have inyour name, the greater probability you have of being sued.

4. Locate or prepare a paper file for each credit account for which you will beapplying these strategies. Each statement should be filed in reversechronological order so that the oldest statement is filed on the bottom and themost recent appears at the top of the file.


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5. Keep a pen and paper next to the phone so that you can follow the procedureto stop harassing phone calls.

6. Review the request for validation procedures so that you can respondproperly to any third party debt collectors. This is also a proper response tocreditors.


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FREQUENTLY ASKED QUESTIONS

Q. What is Winning The Collection Game?A. Winning The Collection Game (WTCG) is the copyrighted work of JohnGliha and includes the strategies and methods of legally avoiding payment ofaccount balances claimed to be owed to creditors and/or debt collectors. It isalso the trade mark of John Gliha and Due Process LTD. It does not includenegotiating for a reduced payment or settlement, consolidation, or bankruptcy. Itinvolves the method of deliberately not making voluntary payments to creditors ordebt collectors and taking every legal defense against whatever collectionprocess may result.

It also includes an unpublished Reference Library which contains a proprietary

collection of work product and trade secrets that consists of legal memoranda,legal arguments, legal metaphors and analogies, discovery questions, exampleanswers, witness names, mail forwarding addresses, examples of collectionpractices and forms filed and undertaken by various law firms, raw data andresearch, statistics, legal theories, evidence, files, instructions, strategies andprotocols that are used to implement the published version of WTCG.

Q. Who would best qualify for this program?

A. This program is for those who, through no fault of their own, have becomevictims of abusive and deceptive collection practices, loss of employment oridentity theft.

Q. Is this legal and why?A. Non-payment is the oldest method of resolving collection problems, literally bythousands of years. Over the last hundred years, the collection system hasadvanced very much. WTCG simply takes advantage of the same legal systemto defend against the claims of the creditor. It is absolutely legal.

Q. How does WTCG compare with consolidation and bankruptcy?

A. It is private. It reduces your credit rating with the chance of restoration.You choose which accounts to settle and which to keep. When applied properly,the strategies have statistically resulted in substantial debt reduction comparedwith other methods, except those which qualify for a Chapter 7 bankruptcy

discharge. Consolidation requires that all accounts be consolidated, reducesyour credit rating with no chance of restoration. Most people pay a great deal ofmoney in making payments to the consolidator, with the result that the accountsrevert back to the original creditor and the balances returned or even more thanwhen consolidation began. Bankruptcy is not private. It requires disclosure and


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liquidation of all assets and debts and ruins your credit history for a minimum often years.

Q. When did the use of these strategies begin?

A. Although the idea of simply not paying creditors is ancient, the deliberaterefusal to pay and use of anti-collection strategies was first published by JohnGliha in WTCG in 1998. He first began using these strategies in 1992 afterdiscovering that the banking system today is nothing more than an elaboratecounterfeiting scheme.

Q. Which people are responsible for completing the research and what are theirqualifications?

A. Many people have contributed to the research that supports the legalfoundation in defending against collections. The most comprehensive work onthis subject was written by G. Edward Griffin and published in his The CreatureFrom Jekyll Island. This text provides the best ten reasons to abolish the FederalReserve System. Glihas work published in WTCG is the practical application ofthis type of research, although each was developed entirely independently.

Q. How does the program work or what can I expect from it in the first year?

A. After sending the initial correspondences which identify the nature of yourdispute, the creditors will respond with normal collection notices claiming thatyour statements are frivolous. They are not of course, but this is what thecreditors will say. You may receive contact from third party debt collectors. Thecreditors will object to arbitration, even though many of them want to force youinto arbitration with a forum they have chosen. Some of the accounts may beassigned to law firms for collection. If you follow the program closely, yourchances of settling your accounts for substantially less than most other methods

are very likely.

Q. What will happen to my credit history?

A. It will appear the same as if you simply stopped paying, charge offs, etc. Wecan remove third party debt collector items provided you did not make payments,and in some cases, we can remove bad credit items. Do not expect that this islikely, but if you are sued or able to confirm your arbitration award, removing badcredit items is for certain.

Q. Will I be sued?

A. Expect to be sued at least once.

Q. If I am sued, will the program prepare me for responding properly?

A. Yes. The program will follow the best course in the process of having thelawsuit dismissed in your favor. Each subscriber can be represented by a localand competent attorney where available, who has been trained in the strategiespublished in WTCG.


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Q. What does the program include?

A. WTCG consists of two volumes and a CD-ROM. They are WTCG (GettingStarted) and WTCG (Advanced Analysis), about 180 pages and 250 pagesrespectively. The CD-ROM contains a list of forms and documents that arereferenced in each text. They can each be easily modified for what you need. If

you are using the attorney services program, the Due Process WorkGroup willassist your attorney in using these forms.

Q. What can I expect after placing my order?

A. Your order is entered in the Debt Nemesis website and a USPS trackingnumber is assigned within one business day. You will then receive an emailwelcome message with the tracking number and further instruction aboutaccessing the online services. You will also receive a telephone call from ourfulfillment center that provides the same information. If you have the attorneyservices program, your local attorney will have contacted you within this time.Within the first seven to ten days you will receive the books and CD-ROM.

Q. Have others been successful using these strategies?

A. Yes, these strategies have been used in over ten thousand collectioncases over the last ten years. The claims made in this presentation accuratelyrepresent the results people have experienced in this time.

Q. How long does the process take to complete?

A. Twelve to eighteen months.

Q. Do I need a lawyer to benefit from this course?

A. No, but each subscriber is encouraged to use a local network attorney who isfamiliar with WTCG strategies.

Q. What types of credit accounts is your course designed to settle?

A. Unsecured credit card accounts, these include signature loans, credit cardaccounts, overdraft agreements and balances claimed to be owed after arepossession or foreclosure. It does not include charge accounts unlessunderwritten by a bank creditor, or lease agreements, or phone serviceagreements nor is it for hospital bills unless any is assigned to a third party debtcollector.

Q. Will I lose my option to file bankruptcy?

A. Never, you can use the course strategies and at any time, change your mind

and file bankruptcy.Q. Can the creditor or debt collector garnish my paycheck?

A. Yes; however this possibility has been shown by statistics to be far lessthan one percent.


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Q. Are there other organizations selling similar strategies?

A. There are no other organizations authorized to publish these strategiesand those that make similar claims have plagiarized parts of WTCG. Its authormaintains a legal fee budget to enforce his copyrights by court order. We haveinvestigated everyone making the same claims and each time we discover that it

is just another perversion of WTCG. Many of this individuals use John Glihasname and trade name, WTCG, in the Internet search engines so that peoplesearching for this program find those that have plagiarized it instead. You shouldverify that anyone representing to sell this program is authorized under currentcontract with Due Process LTD to do so.

Q. Can you help me with a mortgage, auto loan or student loan account?

A. No.

Q. Can your strategies be used to restore my credit rating?

A. Yes.

Q. Would your process cause a foreclosure or my car to be repossessed?

A. No.

Q. Are you affiliated with any attorneys or law firms?

A. Yes, we provide client services for a national network of law firms thatrepresent our subscribers in the attorney services program.

Q. How much time will it take me to understand your process?

A. Usually three months but for those who have the attorney services program,there is no need to study any aspect of the program.

Q. What type of educational background do I need in order to best understandyour course?

A. You need a high school reading level unless you are using the attorneyservices program.

Q. What resources do I need to implement the strategies?

A. Unless you have the attorney services program, you need to speak andunderstand American, and be able to use a computer with a fairly recent versionof Microsoft Word, email access and a printer and access to sending andreceiving faxes.

Q. Will I benefit from your strategies if I have a busy schedule if I am not usingthe attorney services program?

A. Yes, we have toll free and email access to analysts that provideimmediate assistance and guidance through program content. We also provideyou with the form and instruction you need upon request, so that you do not needto first complete your studies in order to receive all of the benefits.


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Q. How do I contact your analysts or customer service?

A. You can contact the Due Process WorkGroup by online email inquiry atwww.d e btnemesis.com, via fax and a toll free telephone number. TheWorkGroup will provide you and your attorney with unlimited forms and research,including any revisions published following your order, for the first year.

Q. Once I complete this process to resolve my collection problems, will I ever beable to qualify for another credit card?

A. Yes, in the same manner you were able to qualify for credit when you firstqualified.

Q. What about hospital bills, lease agreements and phone bills, would thosequalify for your program?

A. Only if the accounts are with third party debt collectors.

Q. How will implementing your strategies for one account affect my other creditaccounts?

A. In some cases, a creditor may increase your interest rate if your credithistory shows unpaid accounts. This can be remedied with a phone call.

Q. Will I continue to benefit from your service and consultation if for someunexpected reason you are not available?

A. Yes, we have trained consultants that are very knowledgeable in the useof this course.

Q. How frequently has your course been revised since 1993?

A. It is officially revised about every three months to accommodate changesin the collection strategies.

Q. Can your strategies assist me if the creditor attempts to force me into bindingarbitration?

A. Yes, the course includes specific provisions for this particular type ofcollection problem.

Q. What kinds of other expenses might I expect if I am sued?

A. There may be a minimal filing fee in your state for the answer or counterclaim,along with very small costs related to copies, postage, notaries and depositiontranscripts. In all, the related costs are very negligible.

Q. Do I need a computer and Internet access to use this publication?

A. Yes.

Q. Can your course show me how to respond to a law firm that continues tosend me collection letters letters?

A. Yes.
http://www.debtnemesis.com/http://www.debtnemesis.com/http://www.debtnemesis.com/http://www.debtnemesis.com/http://www.debtnemesis.com/


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Q. Does your course offer a script to follow when responding to unwanted phonecalls?

A. Yes.

Q. If I do not have the attorney services program, do your consultants providethe service so that they do everything for me, or what level of participation isexpected of me?

A. Most of the time, you will only be expected to complete missing information informs, these would include simple facts such as your name, address and accountinformation. We do provide a service, for an additional cost, that prepare eachform letter for you and delivers them to you for printing and mailing. Only yourattorney will prepare legal documents for court.

Q. Can your program help me if my employment will be terminated if I filebankruptcy or am sued for not paying my bills?

A. Yes, we provide individual and confidential consultation in these types of

cases.Q. In the years that you have been in this business, how many cases wereresolved in a trial, in court but before trial and out of court?

A. Only several have been resolved at trial, most are withdrawn during theproceeding.


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WHAT IS YOUR RISK TO COLLECTION?

Your collection risks increase with the possibility of being sued. Thelikelihood of being sued by a creditor such as a bank or a non-creditor such as adebt collector; is calculated by the policies of the creditor and the possibility ofactually taking property (money) from you. Your risk of being sued increaseswith the dollar amount of the dispute and the possibility of attaching your incomeor assets. Most judgments from unsecured collections do not encumber title toreal estate or other tangible property, but that is determined by state law and thecontract. Of course, an unsecured account does not identify collateral in thecontract (i.e. credit card agreement).

If you have property such as a car or house in your name and if you haveregular income from a job, you are a good candidate to be sued. This possibility

can be reduced by changing a few things about how you manage your property.For most people today, and this number is getting smaller, they own their carsand the equitable (and legal sometimes) interest in their homes for most of theirlives. Unfortunately, many people manage their property in this way until theynear the age of retirement and with the wisdom that comes with age, seek outmeans to protect and preserve their assets in anticipation of death and/orincapacity. Those who can reach this point without losing their property arefortunate. It is never too early to learn how to protect assets over which youbenefit by divesting your ownership and exclusive control over them.

I dont want to discuss asset protection methods in too much detail here

because the subject is adequately covered in other publications, but yourcollection risk can be greatly reduced when you dont own property and whenyou do not have exclusive rights to control the property from which you derive abenefit, such as your house, automobiles and investments. Its important torealize the magnitude of liability if you are the sole owner of your car and house,and are found negligent in some way while driving and are sued for damages.Your house and all other property can be attached in a damage claim, even ifyou dont mind paying high insurance premiums. The insurance protectsproperty you own, but if you dont own or control it exclusively, there is no needto maintain large amounts of insurance. If your car is owned by a contract, letssay a partnership in which you have no ownership rights or exclusive rights to

control what happens to the property, then any liability is limited to the contract(owner of the car) and all property owned by the contract, which would benothing else. Only the rights and property you possess can be attached to theliability and the most effective use of these types of strategies is when they areused in secret.


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This strategy can be applied to all of your assets accept what thegovernment refers to as wage income. That is, money you earn from workingas an employee. Independent contractors have more latitude over this problembecause the right to receive payment for their services can be legitimatelycontracted away. As an employee, you must maintain the rights to receive

money for your work because you cannot legitimately contract them away. It isyou alone, doing the work as an employee and you must be paid in your name.All other types of property can be protected by contracting away ownership andcontrol rights.

The object of protecting your assets is to divest yourself of ownership andexclusive rights to control property from which you and your family derivebenefits, and maintain the beneficial interest through entities (contracts) that willsurvive your death and incapacity.

Your collection risks are further reduced according to your level ofeducation regarding the laws regulating debt collections. The collection processis governed by a very precise set of rules, and these rules are published foreveryone to know. The only problem is that most people need to learn theserules within a short period of time. This is the exact problem this book isintended to solve. Think of it this way, the collection system is governed by a setof rules just as are the traffic systems, social customs, video games, boardgames such as Monopoly and Chess, and even the rules of marriage.Collection rules are simply another set of rules that we have the opportunity tolearn for the purpose of fulfilling obligations to protect our families and ourselves.In other words, learning the legal system as it relates to collections is somethingwe need to do at some point in our lives, whether or not we hire an attorney.

I have only a two-year college degree. I am not a lawyer, I have never

attended law school and I developed this program alone, while working full timein an unrelated profession, from the time I was 24 years of age, with little or noprofessional assistance. It wasnt until I was able to demonstrate theeffectiveness of these strategies that I gained the support of the professionalcommunity such as other paralegals, lawyers and certified public accountants. Ihave written this book so that you dont need to recreate what I developed fromthe consumer perspective. Winning The Collection Game Strategies are yourshort cut to understanding the rules of the collection game, as I call it. In otherwords, if I can do it, you can certainly do it.

The real challenge you will face in implementing the knowledge obtainedfrom this course involves your ability to think critically. In other words, the

templates and standard process explained in this course will help you completeyour defense instead of leaving you with nothing upon which to build yourdefense, what you would have had to do by yourself without this course orthrough an attorney. The templates allow you to avoid the unnecessarydistraction of writing captioned documents and articulating arguments withoutany guidelines to follow because they are nearly complete in themselves.


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However, the level of completion of the templates and examples in this course isno substitute for actually understanding what is discussed, comprehending yourindividual circumstances and having the forthrightness to argue your case in aconvincing manner.

To give you a better idea of what I am trying to explain, Ill use a few

analogies. The examples Ive chosen typically become reality for any creditorlawsuits that are not resolved (withdrawn) before pre-trial. It is convenient tochange a few facts in the templates for each correspondence and send them inthe mail without a second thought. It is convenient to be able to click and dragthe template for your answer, counterclaim, motion to strike and discoveryrequests, insert your name and additional facts that relate to your case and filethese documents with the court. In nearly every case that comes before a judge,the judge will ask you questions for only one purpose, to find out if you canarticulate your own defense as well as the documents that have been written foryou.

You must be able to answer the judges questions, even if you defer hisattention to the motions before the court, the judge must know that youunderstand your position and are able to explain it so everyone else canunderstand, while staying on point. Some people have obtained informationabout the credit and banking system from a variety of sources and the argumentsor defenses against the collections or issues contradict each other. Afterstudying this course, some have been unable to relinquish old protester theories,such as the bank lent me credit and that is illegal. Judges want to hear thisfrom you so that they can enter a judgment for the bank against you.

You must be careful to explain your defenses clearly and as they arepresented in this course. The judge or attorney may ask you if you wrote a check

to fund the account or if you provided cash. The answer to this question is thatyour approved credit application was the cash (or cash equivalent) that providedthe funds for the account. And it will then be important to explain to the judgeand the attorney that the bank or creditor cannot identify any accounts that weredebited in order to credit or create your credit account. In other words, and this iswhere you will need to be able to articulate the situation. If the creditor cannotprove that it risked any money, assets or things of value in the transaction, then itcannot maintain a claim that you owe any more money than you have alreadypaid.

If you attend hearings or write documents with the attitude that you are notsure about yourself or that you only bought this course because it sounded good

even though you dont think it will really help you but you were curious, then youprobably wont be able to present your defenses with enough confidence to beconvincing. You cannot print out templates, insert them in the mail and crossyour fingers or pray that they will save you. You must work at developing eachargument and trying to understand the people you are presenting them to so thatyou can talk on their level. You will see that some attorneys and judges are just


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arrogant and unwilling to cooperate with you or consider your arguments andthey will do everything they can to lie, mislead or trick you into sabotaging yourown case. Still there are judges and attorneys who have enough confidence intheir own professional experience and ability to try and comprehend yourdefenses. Some attorneys will even withdraw their clients case, maybe because

they feel there is too much liability for themselves or they realize that they wouldneed to knowingly misrepresent material facts to the court in order to have achance at winning.

If you can understand what kind of person you are defending against, thatis, what kind of attorney or creditor, you will increase your chances of effectivelycommunicating with him and reaching a timely resolution. You must approacheach case with the attitude that it is the principal for which you are defendingyourself, regardless of the consequences. Some subscribers are terrified of theattorney who threatens that his fees will be assessed against the defendant formaking what he calls frivolous arguments. This should not deter you, and I usethis analogy: Would you commit a crime to avoid personal injury if coerced by

someone? Not necessarily. My parents taught me to tell the truth, and if tellingthe truth and defending myself involves some risk, namely, fines or similarpenalties, than I am not going to lie or not defend myself in fear of these types ofconsequences. If I did, what would that say to others or what kind ofenvironment would I leave for others who are willing to accept the consequencesof defending themselves and telling the truth?


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QUICKLY END HARRASING COLLECTION CALLS

Many people fear debt collection calls and there two very simple strategiesor methods of stopping them, almost for certain.

These procedures apply to any unwanted calls, creditors, debt collectorsor even annoying family or neighbors. In all seriousness though, even thoughcollectors may claim not to be liable under the Fair Debt Collection Practices Act,they are liable under the Telephone Solicitations Act and under the criminalstatutes regarding harassing and threatening telephone communications.

The first lesson in responding to unwanted calls from creditors or debtcollectors is that you must never discuss the account that they are calling about.Your first concern is to obtain the callers full name, mailing address and phone

number. Write this down in a log next to your phone along with the time anddate.

Next, never, never, never give out any information about yourself to thecaller, not your address, phone number, banking information, social securitynumber, driver license number, nothing. Do not acknowledge the accuracy orinaccuracy of any information they provide.

If they do not have it, they dont need it and its their problem. You mayneed to confirm that they have the right person in order to complete the nextsteps, but give them nothing else. Remember that what you say will besummarized or quoted in their call management software database and it will beused against you on the next call. The more information they collect about you,the more times they will be motivated to call you. Follow these steps and youcan use this to your advantage.

Next, inform the caller that the conversation is being recorded, that he hasthe right to remain silent and that anything he says may be used against him in acourt of law. Expect him to end the call at that point, but be prepared to continueto explain that you do not want to receive any more calls from this organizationand that any further calls will constitute harassment and a class 1 misdemeanorunder state law. Explain that if anyone calls you again from his organization afterthis time, that you will hold him personally responsible and file a written complaintfor telephone harassment against him individually with the state attorney

generals office.Next, inform the caller that you are requesting a validation of the disputed

account. Never indicate that you refuse to pay and again, do not discussanything specific about the account. Next, request a copy of their do not callpolicy as required by the Federal Telephone Solicitations Act.


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Next, send the collector the request for validation as explained in this text;along with notice to stop telephone communications as shown on the followingpage.

This procedure is absolutely effective at stopping about 99% of allunwanted phone calls, without regard to the matter about which they are calling.

You can even use it with in-laws and annoying neighbors.

In very few circumstances, you will have a collector who thinks that thelaw does not apply to him and who will ignore all of these responses. You canpursue the complaint to the attorney generals office, but there is one morestrategy you can apply that is more effective.

Debt collectors and creditors calling to collect from you are trying to makea sale, just like any other sales call. Legally, a collection call is consideredsoliciting. They are selling you on the benefits of paying them what they say youowe, in exchange for them not continuing to harass you, not making any moreclaims on your credit history and/or not suing you. That is the implication

anyway, some will even say it. Consequently, the callers are monitored for theirproductivity. A call without a sale (your verbal commitment to make payments)is not productive and they might call you again; however, a call without a salethat substantially exceeds the average call time for most calls of this nature willresult in your account being placed on the do not call list or listed asuncollectible, in which case you should no longer receive any calls.

This is a little time-consuming, but it works very well. Your objective, ifyou must follow this strategy, is to keep the caller on the phone for as long aspossible. The trick is to never discuss the collection account, but make it appearas if you are sincere. Talk about politics, collection laws, the evil banking systemor your political opinion about the Federal Reserve Board. Talk as if you are not

listening to them, or that you are not smart enough to address their specificquestions. For example, Caller: Sir, I need to know when you intend on payingthis bill. You: You people are all the same, you called me last week. Youknow, this banking system has to go, its nothing but evil.

It does not really matter what you say, just avoid discussing the collectionaccount, do not give any payment information, do not make any commitments topay, and sound sincere. If it sounds like the caller is going to end the call, ask fora supervisor. This should double the call time, in many cases.


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[Subscriber][Address][City state ZIP]

[Collector][Address]

[City State ZIP][Phone number]

[Date]

Re Harassing and Threatening Phone Calls From Your Company

Greetings:

Please limit your communication with me to writing only. If I receive anytelephone calls from your company, I will consider them to constituteharassment. Please be advised that unwanted telephone calls are a class 1misdemeanor in this state and I will file a complaint against the caller with the

attorney generals office. I maintain a telephone log of each phone call and insome cases, make an audio recording when necessary.

Send me a copy of your written policy for maintaining a do not call list.The Telephone Solicitation Act requires that such policy be made available upondemand. This Federal statute imposes a $500 fine against unwanted telephonesolicitation. I do not want you to call me. If you do call me, you agree to pay, ona for-hire basis, my telephone equipment and time in answering your call at arate of no less than $500 per call.

Be advised that you have the right to remain silent. If you ignore thisnotice and contact me by telephone, you and your employees agree to allow meto make an audio recording of our conversation and you and your employeesagree to allow the recording and any other information to be used against youand your employees in a court of law. I will accept only your writtencommunication.

Be advised that I am not requesting a "verification" that you have mymailing address, I am requesting a "validation;" that is, competent evidence that Ihave some contractual obligation to pay you.

You should also be aware that sending unsubstantiated demands forpayment through the United States Mail System might constitute mail fraud underfederal and state law. You may wish to consult with a competent legal advisorbefore your next communication with me.

Your failure to satisfy this request within the requirements of the Fair DebtCollection Practices Act will be construed as your absolute waiver of any and allclaims against me, and your tacit agreement to compensate me for costs andattorney fees.

Best regards,


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In the event that you continue to receive unwanted telephone calls, andthis includes from anyone, a debt collector, creditor, attorney, rude neighbor, youcan make a written complaint to your state attorney generals office using thisexample (You should also be able to make this same complaint via the Internet.Just do a keyword search under your states name, and attorney general):

[Subscriber][Address][City state zip]

[Attorney General Office][Address][City state zip]

[Phone][Fax]

Re unwanted, threatening and harassing phone calls

Greetings:Please help me to resolve this problem. I have tried to address it myself

but my requests go unanswered. [Individual calling] from [creditor/collector]continually calls me demanding payment of money I have already paid. Theyrefuse to correct the problem and have been calling me, almost every day,making threats about garnishing my wages or closing my bank accounts.Sometimes they call me numerous times in the same day, even at work. It's likethey think they can do anything they want. Is this illegal?

[Individual calling] said he (or she) could garnish my wages any dayunless I sent payments immediately. He (or she) asked me to fax and then mail

five pre-dated checks or the company would begin garnishing my wages. Canthey do this?

Please help me if you can, as soon as possible.

Best regards,

[Sender]

Copy to:

[Creditor/Collector][Address]

[City state zip]


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CREDIT FILE CORRECTION STRATEGIES

Correcting or restoring your credit history is not a magical process. TheFair Credit Reporting Act defines specific limitations that all credit reportingservices and their subscribing members must follow. The process of correctingyour credit history involves simple letter writing methods and persistence.

I recommend always trying to improve your credit rating with a specificpurpose or plan. Avoid thinking that you just want a better credit score for thesake of having a better score. You want to improve the rating of specific itemsfor the specific purpose of buying a car for example. You must first either obtaina copy of your credit file or submit a credit application and have it rejected for acertain reason. New car dealerships are a great place for this since the salesperson will tell you which items are precluding your application from being

approved. If you begin by applying for an auto loan, you can then work with thesale manager to add disputes and improve certain items until you qualify for a carloan.

The most important secret in restoring your credit history is to begin yourdispute by not requesting a verification or correction of any item, but to simplyrequest that a statement (100 words or less) be appended to the item thatexplains the dispute. The reason is not as important as the fact that you haveappended the dispute to the item. This will immediately improve your chances ofobtaining credit by allowing potential creditors to overlook these disputed items.The next step involves disputing specific items.

Lets begin with an example of a request for your credit history:

[Sender][Address][City State ZIP]

[Credit Bureau][Address][City State ZIP][Phone]

[Date]

Re credit history requestGreetings:

Please send me a copy of my credit report. Ive enclosed a payment for thenecessary fee (or included copies of any letters of denial to obtain a free report).My credit file is identified by the following information:


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full name: ,

date of birth: ,

social security number: ,

present address: .

previous address: ,

My telephone number is: .

I have attached copies of my photo identification and other records in order toestablish my identity. Please send my credit history as soon as possible.

Best regards,


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After obtaining a copy of your credit file, you can dispute any items andrequest a verification of the accuracy of such item. The request must be inwriting. The following items are prohibited: A bankruptcy order that is more thanten years old; lawsuits, judgments and arrest records that either exceed thestatute of limitations or seven years, whichever occurs first; paid tax liens which,

from date of payment, are more than seven years old; collector or charged offaccounts more than seven years old; and any other adverse item of information,other than records of convictions of crimes which are more than seven years old.

The following conditions are exempted from these requirements: a credittransaction involving, or which may reasonably be expected to involve, aprincipal amount of $150,000 or more; the underwriting of life insuranceinvolving, or which may reasonably be expected to involve, a face amount of$150,000 or more; or the employment of any individual at an annual salary whichequals, or which may reasonably be expected to equal $75,000, or more.

This is an example of a well-written dispute letter that has been usedthousands of times with a great deal of success:

[Sender][Address][City state zip]

(credit file number, usually an SSN)

(sender's date of birth)

[Credit Bureau][Address][City State ZIP][Phone]

[Date]

Re credit history correction request

Greetings:

Please correct the following items appearing on my credit report:

(disputed item) is not my account.

(disputed item) has been paid in full but the creditor has failed to provideyou with this new information.

(disputed item) is not valid because it's not my account. I requested a

validation from this alleged creditor, but never receive it. This is a violation of theFair Debt Collection Practices Act and reporting this false information is aviolation of the Fair Credit Reporting Act.

(disputed item) antedates the report by more than seven years.

(disputed item) is incorrect. The corrected item should be " ."


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(disputed item) was not an authorized inquiry. This inquiry was made byfraudulent means.

Please correct your records and send me a copy of the amended report. If youfail or refuse to make these corrections within a reasonable time, I will promptlyfile a complaint against your organization with the Federal Trade Commission.

Best regards,

[Sender]

To use this effectively, you will need to dispute only one or two items at atime. Remove the dispute reasons which do not apply and edit those that do toinclude all relevant facts. Include a copy of your credit file and any pertinentinformation regarding your dispute. Expect to send the same letter at least twice,most employees of the credit bureaus are not competent and are not reallyconcerned with assisting you. Keep in mind that most requests for verificationare completed by computer database matching only, this is the reason primarywhy you may need to send your request twice. Credit bureau employees onlyconcerned with avoiding penalties imposed by the Federal Trade Commission. Ifyou have a problem with a reporting agency acting unfairly, be sure to file acomplaint with the Federal Trade Commission.

One of the more effective strategies in disputing items that you do notwant on your credit history, is to first request a validation (using the two examplesin this text) from the creditor. If the creditor fails to provide evidence that it isyour account, or fails to respond, or fails to validate the accuracy of the amountthey claim is owed, then their failure to validate can be used to remove or correctunwanted items on your credit history.

If you are using poor credit to obtain financing, many lenders will work with

you so that you can obtain financing. The exception to this is when applying for amortgage, mobile telephone service or unsecured credit accounts. There aremany instances where you can use poor credit to obtain accounts with creditrisks, such as utility services, automobiles and insurance.

In the case of an auto loan, the dispute notation you appended to aderogatory item may be enough to allow the dealer to find you a lender. You willnot be able to expect the best terms, but they will be acceptable. Remember thata poor credit rating is not a life sentence, it lasts at most seven years.


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SUCCESSFUL DEFENSES TO COLLECTION LAWSUITS

THE MILLION DOLLAR LETTER

I have been calling this correspondence The Million Dollar Letter for overfour years and it is probably the most widely used response to third partycollection notices in the country. There are two simple reasons for this; thelanguage of the request originates from the same federal law that it invokes andthe results it has produced during this time almost always result in the third partydebt collector discontinuing its collection efforts.

To use this effectively, be sure you identify the collection notice as comingfrom a third party debt collector and not the creditor. Attorneys are not debtcollectors, they represent either, but they are not debt collectors themselves. A

third party debt collector is a corporation that never provided you with credit andis not in the banking or credit business. Most of us are familiar with the corporatenames commonly known as creditors, such as Citibank, Discover, but companieslike Asset Acceptance Corporation and NCO and First Select are not creditors.In response to a third party debt collector, do not send the same objection anddispute letters as for creditors, and do not use the arbitration process. If you do,you may waive your argument that there is no valid assignment, no considerationand be left with defending their collection in court as if they were the originalcreditor. You do not want this to happen. Always request a validation (much thesame as verification) from the debt collector. You can also use the followingexample to request the same from a creditor, just correct the RE line to indicate

the account number.

The request for validation is very effective at showing you whatinformation the collector, creditor or law firm for either has about your account. Italso establishes the foundation for a counter lawsuit for violations of the FairDebt Collection Practices Act.

I do not recommend relying on this strategy exclusively in defendingagainst any lawsuit. It is important to understand that there are many moreprocedures and strategies to implement in the event you are sued. This requestfor validation will eliminate most collection notices and phone calls after it is sentthe first time. It is designed to cause the collector to follow a standard procedure.

In most cases, it will cause a debt collector to refer the collection back to theoriginal creditor. The creditor may respond by sending you a series of your mostrecent billing statements. Their answer will reveal what information they do nothave for your account, such as the original signed credit application. This willgreatly assist you in defending against any lawsuits.


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[Date]

Re inquiry dated : account no. (none, there is no account)

Greetings:

Thank you for your recent inquiry. This is not a refusal to pay, but a noticethat your claim is disputed. This is a request for validation made pursuant to theFair Debt Collection Practices Act. I dispute your debt collection-relatedallegations, deny the same, and demand strict proof and verification thereof.

This dispute, denial, and demand are made in accordance with federal law.Please complete and return the attached disclosure request form.

Please limit your communication with me to writing only. If I receive anytelephone calls from your company, I will consider them to constituteharassment. Please be advised that unwanted telephone calls are a class 1misdemeanor in this state and I will file a complaint against the caller with theattorney generals office. I maintain a telephone log of each phone call and insome cases, make an audio recording when necessary.

Be advised that you have the right to remain silent. If you ignore thisnotice and contact me by telephone, you and your employees agree to allow meto make an audio recording of our conversation and you and your employeesagree to allow the recording and any other information obtained to be usedagainst you and your employees in a court of law. I will accept only your writtencommunication.

Be advised that I am not requesting a "verification" that you have my mailingaddress, I am requesting a "validation;" that is, competent evidence that I havesome contractual obligation to pay you.

You should also be aware that sending unsubstantiated demands for paymentthrough the United States Mail System might constitute mail fraud under federaland state law. You may wish to consult with a competent legal advisor beforeyour next communication with me.


Best regards,


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CREDITOR DISCLOSURE STATEMENT

Name and Address of Collector (assignee):

Name and Address of Debtor:

Account Number(s):

What are the terms of assignment for this account? You may attach a facsimileof any records relating to such terms.

Have any insurance claims been made by any creditor or assignee regarding this

account?Yes / no

Has the purported balanced of this account been used in any tax deductionclaim?

Yes / no

Please list the particular products or services sold by the collector to the debtorand the dollar amount of each:

Upon failure or refusal of collector to validate this collection action, collectoragrees to waive all claims against the debtor named herein and pay debtor for allcosts and attorney fees involved in defending this collection action.

XAuthorized signature for Collector Date

Please return this completed form and attach all assignment or other transfer agreements thatwould establish your right to collect this debt. Your claim cannot be considered if any portion of

this form is not completed and returned with the required documents. This is a request forvalidation made pursuant to the Fair Debt Collection Practices Act. If you do not respond asrequired by this law, your claim will not be considered and you may be liable for damages forcontinued collection efforts.


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This is an example of what to expect in response to your request forvalidation, and how to respond if necessary. You will find the follow up exampleto the request for validation and a final notice you can send to the collector thatfails to answer your request.

The form can be modified if you want to send this second notice thirty

days following your first request for validation because they did not respond. Youonly need to change the first line to I did not receive any response to my requestfor validation dated , a copy of which is attached.

If the collector fails to produce the records or information listed in thissecond request, then send the request. To save you some time, they neverproduce these records. The collector or creditor will claim that those records arenot required in order to comply with the Fair Debt Collection Practices Act, or thatbecause they are the creditor, the Act does not apply to them, or because its abusiness account, the Act does not apply. Although correct, these records andinformation are required in court to prove their case, so by sending this letternow, you are establishing a foundation for your defense, and for requiring themto produce the information in court, in the event you are sued.


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[Date]

Re inquiry dated : account no. (none, there is no account)

Greetings:

Thank you for your recent response to my request for validation. This isnot a refusal to pay, but a notice that your claim is disputed. Your response didnot include sufficient information to esta b lish your claim or meet the require m entsof the Fair Debt Collection Practices Act. Again, I dispute your debt collection-

related allegations, deny the same, and demand strict proof and verificationthereof. This dispute, denial, and demand are made in accordance with federallaw.

I need documents or information that show how I might be obligated topay you. Do we have an agreement, maybe a contract in writing? I have neverheard of your company before. What is the nature of your business? Are you adepository or lending institution? Did you provide me any services or products?If you did, please list them and be specific. What did I buy from you? Did eitherof us rely upon the other to perform? When did you solicit my business or do youhave any records showing that I solicited your business? If I owe you money asyou claim, then what is your obligation to me?

If you claim to be the assignee debt collector for a particular creditor, doyou maintain a valid license and bond to engage in this particular collectionactivity in this state? What are the terms of the assignment? What are yourrights and liabilities and what are the assignors rights and liabilities under thepurported assignment agreement? When did I consent to the assignment and doyou have evidence of that consent? What provisions of the purportedassignment agreement describe my rights and liabilities under its terms? In whatmanner did I benefit from the purported assignment? Is the purportedassignment within a class of contracts, the performance of which might exceedone year? Please include a facsimile of this agreement and any other supportingrecords in your reply. Please answer these as soon as you can and be specific.

If you dont provide me the information requested within thirty (30) days Iwill consider the purported debt to be invalid, that you made a mistake, and thatyou agree to sanctions imposed against you and your organization for knowinglycontinuing a frivolous claim against me.


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Please limit your communication with me to writing only. If I receive anytelephone calls from your company, I will consider them to constituteharassment. Please be advised that unwanted telephone calls are a class 1misdemeanor in this state and I will file a complaint against the caller with theattorney generals office. I maintain a telephone log of each phone call and in

some cases, make an audio recording when necessary.Be advised that you have the right to remain silent. If you ignore this notice andcontact me by telephone, you and your employees agree to allow me to make anaudio recording of our conversation and you and your employees agree to allowthe recording and any other information to be used against you and youremployees in a court of law. I will accept only your written communication.

Be advised that I am not requesting a "verification" that you have my mailingaddress, I am requesting a "validation;" that is, competent evidence that I havesome contractual obligation to pay you.

You should also be aware that sending unsubstantiated demands for payment

through the United States Mail System might constitute mail fraud under federaland state law. You may wish to consult with a competent legal advisor beforeyour next communication with me.


Best regards,

[Subscriber]


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This is another example I believe to be valuable in giving you thelanguage you need to respond to those rude collection notices you might receivefrom an attorney in response to your request for validation. It can also be used torespond to offers to settle the collection account with a reduced payment. Pleasebe careful to read the following section that explains the problems you might

expect from making any settlement payment.[Subscriber][Address][City state ZIP]

[Attorney][Name of Creditor][Address][City state ZIP][Phone]

[Date]

RE [Name of Creditor]; Account No. 0000-0000-0000-0000

Greetings [Name of Attorney]

Thank you for your recent response to my letter of inquiry dated ;however, you have failed to give sufficient information regarding the alleged debtthat you are attempting to collect. Before I consider any offer or settlementterms, I will need the additional information that you have not provided.

Please identify or describe any losses or injuries incurred by your client.Explain whether or not your client lent me any money or the manner in which thedisputed credit account was originated.

Best regards,[Subscriber]


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If you want to finish the series of communication in the event that thecollector fails to satisfy your request, you may use the following example as yourfinal notice.

[Subscriber][Address]

[City state ZIP]

[Collector][Address][City State ZIP][Phone number]

[Date]

Re inquiries dated and (see attached copies)

Greetings:

I have made two separate requests for validation (see attached) and your

response or lack of response fails to comply with the disclosure requirements ofthe Fair Debt Collection Practices Act. Enough time has passed to allow you tocomply but you have failed to meet the legal requirements of the law. It isapparent that you have no claim and that you have no records or evidence tosupport any claims against me. You have not provided me with any evidence toestablish that I owe you any money.

Your failure to respond in a timely manner is therefore deemed as anadmission that you are not able to support your claim of debt against me. Pleasebe advised that should you initiate a lawsuit against me without having proof thatI owe you anything at all, I now have evidence that you are advancing a frivolous

lawsuit.Starting a frivolous lawsuit may subject you to sanctions by the court, includingcosts, fees, and penalties. I urge you to carefully consider your course of actionfrom here on out.

Best regards,

[Subscriber]


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No more communication is necessary. These two letters are enough toaccomplish your objective of determining what information the collector orcreditor has about you. This will better prepare you for any possibility of a lawsuitand restoring your credit history.

The following instruction supplements this procedure to give you a better

understanding of why it is effective. These strategies can be relied upon when acreditor assigns, sells or transfers a debt to a third party collector without theconsent of the debtor. The object in corresponding with collectors is to enforcethe protections under the Fair Debt Collection Practices Act by first requesting avalidation of the purported debt. Lawyers and law firms are not organized asdebt collection companies, but may sometimes represent third party debtcollectors. Sometimes it is confusing because of the notice they include at thebottom of their collection letter This is an attempt to collect a debt, and anyinformation This does not mean that the lawyer or law firm is the actual debtcollector, only that they want to avoid the liability under the Fair Debt CollectionPractices Act which made attorneys liable in 1996. If you are not certain who

they are or who they are representing then ask over the phone or send them arequest for validation.

I have found that even though a debtor might have owed the originalcreditor (it doesnt matter whether he did or not), the third party debt collector isunable to validate the account simply because of the way they operate. In otherwords, the debt collector is never part of the original credit agreement; they getinvolved only after the debt is charged off to collections. The term charged offmeans that the creditor reported the unpaid account as a loss and claimed a taxdeduction and if it was insured, filed a claim to recover it. The charge andsubsequent assignment, when done in this manner renders the debt collectorsclaim invalid, not only because you cannot be compelled to pay a third partyassignee without your prior consent, but because they simply cannot prove youowe even the creditor or that there was a valid assignment agreement. Most ofthese companies do not maintain the records needed to validate such claimsbecause many people do not question them this way. I believe this might changeas more people learn how the system works and use it against the collectors.

Remember that the debt collector is not required to actually provide youwith evidence or proof that you owe what they say you owe, new case lawregarding the Fair Debt Collection Practice Act standards requires only that thedebt collector confirm the correct spelling of your name and the dollar amountthey say you owe. My form letter includes requests for more information,

knowing that it is not required at this stage, but it does establish a foundation forthem to be required to provide this evidence if they sue you. Most debt collectorsdo not sue anyone; their primary skill is in obtaining a payment commitment overthe phone.

Examples of proof of the debt would include some evidence that youderived a benefit from the alleged debt. It might also include a payment history


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and remember that a contract does not require a signature to be binding. Theclaimant (e.g. the debt collector) merely needs to establish that the debtorderived some benefit from the collector. They do need evidence of yoursignature connected with the terms of any contract they want to enforce, specificto a certain provision. But they can sue you for what is called account stated

which avoids the problem of proving the existence of a written contract.The facts of any collection today would never satisfy these requirements,

unless the debtor paid money to the debt collector or was given the ability touse a line of credit with the debt collector and failed to refuse it. Some debtcollectors will actually send you a credit card or a check stating that if you failedto refuse the offer, you will benefit from the new contract. There is a cleardistinction between a creditor and a debt collector. A debt collector is not, in anyway, a creditor and every aspect of the debt collectors business is regulatedunder the Fair Debt Collection Practices Act.

After several years of discussing this book with subscribers, I decided toinclude this section to help others prepare for what to expect when they followthis process. You must first learn to recognize the differences between a debtcollector and a creditor (or the assignee creditor). In cases where a creditor hasassigned your account to another creditor who is in the business of providingcredit services and may be a member of Visa or MasterCard, you shouldconsider the collection as if it were undertaken by the original creditor.

In the case where a creditor assigns your account to a third party debtcollector, a business that does not provide credit services and is not a member ofVisa or MasterCard or any of the other credit card technology associations,you would respond with a request for validation and your defenses would bethose explained in this chapter.

Typically, you may receive a notice from the creditor that your account hasbeen charged off to collections, and a subsequent notice from a company thatyou have never heard of, requesting payment. The collector is usually notrepresented by an attorney, but if it is, the response is the same, send a requestfor validation. Just like actual debt collectors, attorneys are required to includethe debt collector notice, This is an attempt to collect a debt and any informationobtained will be used for that purpose. But that does not mean that the attorneyor law firm is the debt collector itself. The lawyer would be representing the debtcollector in nearly every situation.

Lawyers know that it is not a good business practice (too much liability) to

work as debt collectors themselves, or engage their entire law firm in that type ofbusiness. This is because of the liability of being sued under the Fair DebtCollection Practices Act and because of the different licensing requirements ineach state. First, they must be authorized to practice law in each different state,by each state bar, then as a debt collector, they must maintain a separatelicensing for each state in which they want to do business (engage in collections).


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There is far less liability for the lawyer to either enter into a partnershiparrangement with an established debt collector, or to create his own debtcollection corporation.

You can expect a variation of many circumstances once an account goesinto collections (is charged off). It is important to distinguish between the original

creditor and the assignee (debt collector). Always request a validation from theassignee debt collector as soon as you receive the first collection notice in themail or in writing. If the collector calls before sending the first notice, obtain theinformation about the caller's identity and collector for whom he or she is calling.Explain that you will not discuss the collection over the phone but they maycorrespond with you in writing. It is important to maintain an open line of writtencommunication in the beginning of a collection with the assignee debt collector.End the call after you have explained this and collected the information, and donot discuss any aspects of the collection.

1. The collector may send you all the information it has from the accountyou had with the creditor. This does not establish any contractual obligation withthe collector but only supports the fact that you do not owe the collector. Thistype of response is known as a "non-response" or a "failure or refusal to validate"and does not satisfy the legal requirements of the Fair Debt Collection PracticesAct.

2. The collector may reassign the account back to the creditor. In thiscase, the creditor can no longer enforce the collection because it has previously"repudiated" the account. It has no more standing than any other third partycollector at this point.

3. The collection may be assigned to another debt collector. Follow thesame process as if it were a new collection (because it is).

4. If or when you begin receiving phone calls, make a record of thecaller's name, company, phone number, address, date and time of call. Send awritten communication to the caller requesting that future communication belimited to writing only. If they refuse to honor that request, then send a writtencomplaint to the attorney general's office for your state, alleging that the caller ismaking unwanted, harassing and/or threatening phone calls to you. Include acopy of your telephone log. Send a copy of the complaint to the caller or hiscompany. That should end the problem very quickly. Follow the proceduresalready explained in this text for stopping unwanted telephone calls.

5. The collector may tell you that if you do not pay by a certain date, they

will report the unpaid balance to the Internal Revenue Service on a Form 1099 asimputed income. This type of income is the result of benefiting from not paying adebt and is taxable; provided that money was actually lent to you and that youhad made payment arrangements and failed to maintain them as agreed.Imputed income does not result when you simply never pay the debt collector,and the way creditors operate today, no money is ever lent to the customer. And


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as for debt collectors, they do not even claim to be in the business of lendingmoney, and without any evidence of a contractual obligation between you andthe debt collector, their claim would be false. This text gives you an example ofthe type of response you should send.

The important aspects of defending yourself against debt collectors

include the Fair Debt Collection Practices Act, simple contract law and the basisthat a debt collector (assignee) cannot establish any contractual nexus to enforcea claim. This doesnt mean that the creditor does not have the right to assign theaccount to collections, the assignment clause permits this; however, the terms ofthe assignment fail to include the account holder (you), and this renders theactual collection unenforceable.

Most importantly, if there is no written assignment agreement between thecreditor and third party debt collector, in which the creditor (assignor) waives allclaims against you, then there is no valid assignment. Further, absence ofvaluable consideration, an exchange between you and the debt collector of abenefit of detriment, then there is no valid assignment due to failure ofconsideration.

A contract is an agreement between two or more people or entities inwhich obligations are created by what is known as "consideration." In law, theterm consideration means the exchange of a benefit or detriment. The essentialfactors in determining whether or not a valid contract exists are first, there mustbe an offer, there must then be an acceptance and there must then be anagreement to perform under the terms and conditions of the contract. And whilethese are the basic elements of a contract, it is of no value unless it can beenforced in a court of law. To establish the validity of a contract, considerationmust first be given.

Remember that no process actually prohibits a collector or creditor fromsuing you. Even the United States president can be sued while in office. Anyonecan file a lawsuit; however, if you follow the principles in this book, the collectoror creditor will not be able to enforce its claim or get a judgment against youprovided the circumstances are similar to what is described here. My entire letterwriting process is based upon little known but basic principles of contract law. Ifpeople had a basic understanding of them the credit and collection industrywould probably not exist today.

Elements of a contract or agreement

If I agree to purchase a service from someone, that agreement is not valid

until I pay something for it or enter into a written "promise to pay. It is"consideration" that creates an obligation and it can be in the form of just givingsomething in exchange for the performance or benefits of the contract. If Ihanded you a book that you wanted and you agreed to do something for mebecause of that book, then we have a valid contract. This type of verbal contractis sometimes difficult to enforce because when tested in court, the parties may


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not be able to resolve genuine disputes as to the true agreement. The courtmight then make a judgment based on what would appear to be equitable.Consideration for a valid agreement involves an exchange of a benefit ordetriment between two or more people or entities.

A valid contract exists when there has been an offer, acceptance,

agreement, and when consideration has been made. And these contracts areeasier to enforce when they are written; however, there are at least two moreimportant factors involved in making a valid contract. Each party to the contractmust be competent, or have the standing to contract, and the terms of thecontract must be equitable for everyone entering into it. A contract is a matter ofequity.

In other words, a contract with someone who is insane or not of soundmind (non-compos mentis) is not valid or enforceable in any court because itcannot be equitable. A contract with a child is not valid except to the extent thatit may be enforced upon the party who is not the child. A contract with acorporation is not valid unless it is directly with its board of directors or anauthorized agent or officer as defined in the corporation's articles and by-laws. Acontract with any government is not valid unless it is authorized by one holdingan office as prescribed by law and the office holder must have the properdelegation of authority as required by statute. When a contract is not equitable itcan be said to be unconscionable, and therefore, unenforceable.

If I agree to pay for a service and enter into a contract to that effect, then itmay be enforceable. However, if the written terms of the contract create onlyobligations for me, but not for the service provider, it can be said to beunconscionable. It could not then be enforceable in any court for two reasons,the first because it was not fair or equitable, and the second because such an

action to enforce it would be barred by the statute of frauds (no contract inwriting).

On its face, such a contract could be found to be unconscionable whenthe service provider attempts to sue for breach of contract. Or, if I brought suitfor the service provider's failure to perform, there's a good chance that becausethe contract was more or less one sided, I wouldn't be able to show the court thatthe service provider had any particular obligation as agreed to under the writtencontract. Contracts cannot be extended beyond the language of the writtenagreement. And agreements made in a written contract must be performedwithin a certain period of time. Even statutes and company charters haveexpiration dates.

The request for validation process can benefit you in restoring your credithistory.


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CHANGE OF ADDRESS

This first step involves a little time and preparation. It can be avoided fornow, but the earlier you complete this, the better your chances will be of avoidinga lawsuit. The standard method of determining which law firm or attorney will bechosen to file suit against you is based upon your mailing address. It is assumedby the collections department and the law firm that your mailing address is yourplace of residence. Since the bank must file suit in the county in which youreside, it must then locate a law firm that is local to this mailing address.

If the collection department sees that you reside in Phoenix, Arizona, it willassign the collection to a law firm located in Phoenix, Arizona. This isinformation that you provide, and when you move to a different address, you caneasily complete a change of address form and include that with your monthlypayment. What if you submitted a change of address form with an addresslocated in the middle of the Atlantic Ocean?

Provided that you would ultimately receive all mail, or that you pay yourbills online so that this would not be a factor, no one would probably notice. Infact, if your account did go to collections, upon deciding to file suit, thatdepartment would attempt to locate a local law firm to the middle of the AtlanticOcean. What do you think your chances of being sued would be at that point?There is a chance that the bank would have archived a history of previousmailing addresses, and be able to try the next most recent. But what if they didnot?

What if you sent the bank a change of address notice with an address inan area of the United States that had a population less than 4,000 people in onecounty? Your chances of being sued by a local law firm would be dramatically

reduced.I hope you dont get the wrong impression, that John Gliha is saying duck

and hide and thats your solution to debt problems. No, I believe this is apractical strategy and one that is consistent with my text and other strategies.Along with the correct statement used in asset protection and privacy methods,They cant take it if they cant see it; it may be equally true that they cant take itif they cant take you to court and obtain a judgment first. The only way to do thatis to properly serve you with a summons and complaint, and with a local attorney,at least within a few hours of where you apparently live.

I have compiled a list from the World Almanac 2003 of every county in thecountry where the population was under 2,000 people in 2001 and between2,000 and 4,000 people in 2001. This edition does not include any mail boxservices, but you can easily locate any post office boxes in these areas. You willhave difficulty finding a mailbox service for the same reason that the bank willhave great difficulty finding a law firm in these counties. However, an Internetkeyword search and searching at websites for services such as Mail Boxes Etc.,


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The UPS Store, and Pak Mail will be to your advantage. You may need to obtaintheir consent to open a box via mail, and if they accept, they will want to see twophoto identifications, and have you complete and Form 1583 required by the postoffice.

Once you are able to open your new mail box, you can complete the

change of address notification for each credit card account to which you wish toapply these strategies. The mail they send you can then be automaticallyforwarded to your local address for response.

I know that some of you will ask me What happens if I do this and theysue me anyway? Well, thats why I wrote the course, but in this case, your firstresponse is to file a motion to dismiss for improper venue (without making anyother motions) and explain how your residential address is where it is. This willonly cause delay, but at least the lawsuit can be handled locally.


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Alaska

Pop. 2001

Bristol Bay Borough 1196Denali borough 1914Lake and Peninsula Borough 1675Yakutat Borough 791Haines 2333Skagway-Hoonah-Angoon 3449

State

County Pop. 2001 Seat of Government

California

Sierra 3485 (Downieville)

Costilla 3647 (San Luis)Custer 3693 (Nestcliffe)Ovray 3882 (Ovray)Sedgwick 2668 (Julesburg)

Colorad o

Dolores 1837 (Dove Creek)Hinsdale 800 (Lake City)Jackson 1589 (Walden)Kiowa 1537 (Eads)Mineral 809 (Creede)San Juan 586 (Silverton)

Georgia

Quitman 2610 (Georgetown)Schley 3921 (Ellenville)Webster 2301 (Preston)

Idaho

Camas 1002 (Fairfield)Clark 971 (Dubois)Adams 3428 (Council)Butte 2856 (Arco)

Lewis 3625 (Nez Perce)

Kansas

Comanche 1961 Coldwater)Greeley 1503 (Tribune)Wallace 1706 (Sharon Springs)


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Carter 1375 (Ekalaka)

Daniels 1998 (Scobey)Garfield 1243 (Jordan)Golden Valley 1019 (Ryegate)McCone 1900 (Circle)Meagher 1938 (White Sulpher Springs)Petroleum 488 (Winnett)

Cheyenne 3114 (Saint Francis)Clark 2371 (Ashland)Decatur 3432 (Oberlin)Edwards 3325 (Kinsley)Elk 3189 (Howard)

Gove 3008 (Gove)Graham 2845 (Hi

Bank Attorney Reveals

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