Everyone falls on hard times, especially during the current Coronavirus pandemic, and some of us have fallen into debt. It’s not a unique story: lots of people have trouble paying bills and end up in hock to debt collectors.
If you’ve fallen behind and haven’t or didn’t work with the financial institution in the first place, you may find that you are no longer dealing with the original creditor, but rather, with a debt collection agency.
How did this company get your information? Why do you owe them money and not the former lender? How do you deal with it?
Let’s take a look at all of these things and especially, how to deal with Cavalry Portfolio Services (CPS), one of the largest debt buyers in the country.
Who is Cavalry Portfolio Services?
Cavalry Portfolio Services is a United States debt collection company founded in 2002.
They acquire delinquent or non-performing consumer loan portfolios typically from credit card companies such as Bank of America and CitiBank, but also cell phone carriers, retailers, and other loan agencies.
This New York-based company is not accredited by Better Business Bureau (BBB) but has been given an A+ rating.
CPS has received quite a bit of complaints in regard to customer care with collection accounts. They’ve logged in 223 total complaints in the last 3 years and nearly 1950 complaints with the Consumer Financial Protection Bureau (or CFPB).
Cavalry Portfolio Services, LLC’s contact information is as follows:
- Address: 500 Summit Lake Drive Suite 400 Valhalla, NY 10595
- Phone Number: 1-866-483-5139
- Website: https://www.cavalryportfolioservices.com/home
- Other Names: “Cavalry SPV I, LLC”, “Cavalry SPV II, LLC”, and “Cavalry SPV IV, LLC.”
Essentially once they purchase your credit card debt, they assign a resolution specialist to your case and open a collections account on your credit report.
This basically notifies the three major credit reporting agencies or credit bureaus you have delinquent debt, seriously lowering your overall credit score.
How Do I Deal with Cavalry Portfolio Services?
Make No Promises
Whatever you do, do not pay the debt collector right away and do not say anything that would suggest you will.
Mistakes have been known to happen and debt collectors deal with so many different accounts and amounts each day that it isn’t ridiculous to think they have your name incorrect.
Validate the Debt
The best way to deal with CPS or any debt collector, for that matter, is to ask them to prove that you actually owe the debt in question–Debt validation.
CPS and other collectors will often buy debt information from companies in the form of spreadsheets with names, addresses, phone numbers and account balances. This is hardly a fail-safe way to do business.
In fact, CPS knows this and they are counting on most consumers to simply pay the bill. You shouldn’t do that. Instead, ask them to verify the debt.
There are a variety of different form letters online (including one here) that you can send to CPS or another debt collector asking them to confirm that you actually owe the debt in question, and they have the authority to collect it.
Know Your Rights
These two acts create guidelines debt collection agencies must follow including things like:
- There is a statute of limitations available to pursue a debt
- Debt collection companies cannot harass you with phone calls past normal business hours and cannot alert coworkers or family members of your debt through phone calls or collection letters.
- They cannot use obscene language or give false information to persuade you to pay the debt.
- They cannot falsely threaten to garnish wages from your bank account or any other source of income.
There are more details of those guidelines that can be found at https://www.consumerfinance.gov/ask-cfpb/are-there-laws-that-limit-what-debt-collectors-can-say-or-do-en-329/
The Consumer Financial Protection Bureau is a good resource. CPS may not be able to prove that you owe the debt at all. If they can’t, must forgo collection.
A common concern we hear is, “Can Cavalry Portfolio bring a default judgment against me or sue me?”
If they can, or they end up suing you, it’s important that you answer any summons that come your way. Ignoring a court summons can lead to a default in CPS’ favor.
Fortunately, the burden of proof is on CPS, not you. They have to be able to show an accurate and complete trail of the debt, that they have the right to sue you, the amount you owed in the first place, and the amount you owe now.
Hopefully, however, it won’t come to debt-collection lawsuits. Generally, a debt buyer will either be very confident in their ability to show that you owe the debt or they will not and will give up.
Debt Buyers?! What?
That’s right. There are companies out there whose sole job is to buy debt and attempt to collect it. How do they do this? Let’s look at an example.
John Smith has a job and is doing well for himself. He owns a car and a home and has a moderately decent credit score. Unfortunately, he slips and falls on his front steps and ends up in the emergency room.
He’s on the mend and returns to work, but comes home one day to find a bill from the hospital for $1,000. Apparently, he hadn’t yet met his deductible for the year, so he owes the hospital money. He forgets about it and doesn’t pay. Subsequent letters end up in the trash can.
About three months later, he receives a rather threatening call from CPS saying that he owes them $1,000 and that he needs to pay ASAP.
How did this happen? In short, the hospital sold the debt. Lenders, very often, are not expert debt collectors. They provide a service, like medical care, vehicles, or consumer products like electronics. They likely do not, however, collect stale debt.
Debt collection agencies will buy this debt from the original lender for pennies on the dollar. Why do the original lenders agree to this? Because they need the money!
Even if they only get a small fraction of what they are owed, it’s still better for them than going through the trouble of attempting to collect the debt from you directly. They want to let someone else deal with it!
Just a general disclaimer, the information in this article does not substitute as legal advice. Please seek out legal counsel with a law firm should your situation warrant it.
Important Note: Financial Institutions Don’t Want to Send Your Debt to Collectors
The last thing that a financial institution wants to do is lose money. Selling your debt to a collector means they are losing money.
It is in both of your interests to work out a way for you to pay back the whole amount that you owe, directly to the company for debt relief. When you’re having a tough time paying your bills, the first call should be to your creditors. They will be able to set up payment plans and help you get back on your feet.