Jefferson Capital Systems, LLC

Jefferson Capital Systems, LLC

If a collection account appears on your credit report from a company called Jefferson Capital Systems, or simply JCap, you’ll need to address the situation head-on.

Though this company seems like one of the more reasonable collection agencies to deal with, they should never be ignored.

Collection accounts have a way of getting worse with time, not better.

Some companies don’t even attempt to call you or contact you in writing. Instead, they put a collection account on your credit report, which you may be tempted to ignore if you believe it’s not legitimate. If you follow that path, bad things can happen.

First, the account will remain on your credit report for up to seven years from the date it first became delinquent.

During that time, it will lower your credit score. And it’s even possible the collection agency will convert the account into a judgment.

If that happens, you’ll have no choice but to pay the full amount of the debt.

The company will also be able to legally garnish your wages until full payment is received.

Dealing with collection agencies directly isn’t for everyone. If you feel like taking on Jefferson Capital Systems yourself, we will offer strategies for how to do that in this article.

But we’ll also provide resources for professional help at the end of the article in case that becomes necessary.

What is Jefferson Capital Systems?

Jefferson Capital Systems, LLC, was founded in 2002, and is based in St. Cloud, Minnesota. The parent company is CL Holdings.

Many collection agencies are primarily third-party collection services for an original client. But Jefferson Capital Systems both purchases and services delinquent accounts.

These include consumer charge-offs and even bankruptcy accounts. The company often appears on a credit report as JCap.

You should be aware that Jefferson Capital Systems does engage the services of third-party collection agencies to collect a debt.

That means you may be dealing with multiple collection agencies, which can get messy.

But there is one bit of good information about this particular collection agency.

The company FAQ page says the following about how they report paid accounts to the credit bureaus:

“Our policy is that we will request the credit bureaus delete the trade line approximately 30 days after the final payment has been posted that resolves the account as paid in full or paid in full for less than the full balance.”

It’s not clear if that means the company requests that the credit bureaus delete the account or merely indicate that it’s been paid.

But it does open a window of hope that a paid account may be removed from your credit report.

Is Jefferson Capital Systems Legit?

Jefferson Capital Systems, LLC is a legitimate debt collection agency that has a Better Business Bureau rating of “B”, on a scale of A+ to F.

The BBB reports no fewer than 1,353 complaints against the company within the last three years.

To their credit, Jefferson Capital Systems has answered all the complaints we surveyed and even resolved many of them in the consumer’s favor.

Common complaints include:

  • violation of federal law
  • failing to validate a debt
  • lack of response from the company
  • accounts reported that are over seven years old
  • attempting to collect debts fraudulently opened in a consumer’s name

If you are overwhelmed by dealing with negative entries on your credit report,
we suggest you ask a professional credit repair company for help.

Ask Lex Law for Help

Before You Deal with Jefferson Capital Systems

There are certain basic rules for dealing with any collection agency. You’ll need to be familiar with those rules before taking on Jefferson Capital Systems.

1. Don’t deal with collection agencies by phone

This is the absolute worst way to deal with any collection agency because it gives all the advantages to the agency, leaving you at a substantial disadvantage.

That’s because collection agents are highly skilled at the collection process, while the average consumer knows little about it.

A skilled agent can extract additional information from you, which can be used to strengthen the company’s claim against you.

They can even convince you to make payment promises you can’t afford to cover. Either situation has the potential to go very badly for you, and that’s reason enough why you should avoid phone contact with collection agencies.

Still another issue to be concerned with is that collection agencies record telephone conversations.

That means anything you say in a phone conversation can be used as evidence against you in a lawsuit, in much the same way as a written agreement can be.

Finally, there’s the annoyance factor. If you allow collection agencies to contact you by phone, the potential for harassment is very real.

They can call you multiple times a day, both at home and at work.

2. All contact with Jefferson Capital Systems should be in writing

Fortunately, under federal law, you have the right to insist all communications with a collection agency take place in writing.

That will put an end to the phone calls and many of the problems they cause.

But, there are also real advantages to written communication when dealing with a collection agency.

First, it minimizes the possibility of “misunderstandings.” Everything can be written clearly in black-and-white, eliminating the possibility of misinterpretation.

Second, it’ll make it easier for you to control how much information you divulge to the collection agency.

Third, it makes it easier to keep track of the progress of your negotiations.

Just as important, written communication gives you an all-important paper trail of the entire process.

That will not only enable you to keep better track of what’s really going on, but it can also serve as evidence in your favor if the collection agency has violated federal law, or if they attempt to bring a lawsuit against you.

All letters you send to the collection agency should be sent by certified mail, return receipt requested.

That will provide conclusive proof that you not only sent your letters, but that they were received. Keep all correspondence in a central location for easy access at any time.

3. Never promise to make a payment unless you’re willing and able to make it

If you make a promise to send money to a collection agency, then fail to follow through, the agency can use that as evidence against you in a lawsuit.

Simply put, never promise to send payment to a collection agency unless you have the funds available to make the payment, and you fully intend to send it.

Any other course of action will make your situation worse.

4. Familiarize yourself with your rights under federal law

Read up on your rights and protections under the Fair Debt Collection Practices Act (FDCPA).

The FDCPA is a federal law that protects you from certain collection agency abuses.

Since collections agencies have a reputation for getting ugly, knowing these rights could help you have the upper hand.

You can learn these protections by reading the Debt Collection FAQs provided by the Federal Trade Commission (FTC).

Specific Strategies for Dealing with Jefferson Capital Systems

Now that you know the basic rules for dealing with collection agencies, let’s concentrate on specific strategies for dealing with Jefferson Capital Systems and getting the collection off of your credit report:

1. Demand Jefferson Capital Systems Provide a Debt Validation Letter

Under federal law, collection agencies are required to furnish you with a document that proves both the legitimacy of the debt and its connection to you.

This is done through what is known as a debt validation letter. Insisting on obtaining this letter should be your first step in dealing with Jefferson Capital Systems.

The letter should include information about the debt and your own liability for it. That will include the amount of the debt, the name of the original creditor, the date the debt went into collection, the full amount of the debt, what the debt was for, and information that clearly connects you to the obligation.

You can use the information contained in the debt validation letter as a basis for challenging the debt.

For example, if the collection agency is attempting to collect a debt you’ve already paid, you should be able to dispute the debt successfully by providing evidence of previous payment.

If it’s a case of mistaken identity—which is especially likely if you have a common name—there may be certain information in the debt validation letter indicating the responsible party is someone other than you.

This can include a residential address you’ve never lived at, an incorrect Social Security number, or even an incorrect phone number.

If it’s clear that any of this information is in error, you should send a letter to Jefferson Capital Systems, alerting them of the discrepancy.

Including documentation proving your claim will strengthen your case. The letter should also demand that the collection be dropped and removed from all three credit bureaus.

2. Request a Goodwill Deletion

If you know that a debt is yours, or if the debt validation letter provides conclusive evidence that it is, you may want to pay the debt off and move on with your life.

But you may be able to get the collection removed from your credit report, too, by requesting a goodwill deletion.

You’ll send Jefferson Capital Systems, a goodwill letter, requesting that the account be deleted from your credit report as an act of goodwill.

As you might imagine, they’re not going to delete the collection out of the goodness of their collective hearts.

You’ll need to provide a convincing explanation that the reason the debt went into collection was due to circumstances beyond your control.

That would be something like the death of a loved one, divorce, a business failure, or anything similar. Including third-party documentation supporting your claim will definitely help.

You should also know that this is a strategy that will only work if you’ve either already paid the debt in full, or you intend to. It’s not likely to work with a partial payment.

3. Offer a “Pay-for-Delete” Agreement

This strategy has a high likelihood of not working, but it may be worth trying anyway.

You see, collection agencies aren’t paid until you pay the debt. As such, they may agree to delete the collection account from your credit report in exchange for full payment.

You can send the company a pay-for-delete letter, in which you offer to make full payment in exchange for the agency deleting the collection account from your credit reports.

If they do agree, ask them to confirm their agreement in writing. However, even if they do confirm in writing, the hoped-for deletion may still not come.

The company may accept your payment, and then fail to remove the collection account from your credit reports.

The reason is that a pay-for-delete is not a legally enforceable arrangement. Yes, the company may agree to it, and they may even follow through—which is why it may be worth trying.

But, there’s an excellent chance it won’t work the way you hope.

4. Demand Deletion if Jefferson Capital Systems Can’t Fully Validate the Debt

Getting back to the debt validation letter, it is possible the collection agency will not abandon their collection efforts even if they fail to provide a debt validation letter, or if the information is incomplete.

If that’s the case, you can open a dispute with the three major credit bureaus, who will investigate your claim within 30 days.

If Jefferson Capital Systems similarly fails to provide the requested information, the credit bureaus will remove the collection account from your credit reports.

However, it is possible that Jefferson Capital Systems may continue collection efforts against you, even if the collection is deleted from your credit reports.

If that turns out to be the case, you will most likely need to get professional help to put an end to the problem.

5. Settle the Debt for Less than the Full Amount Owed

This is another example of how you can use the collection agency’s desire to get paid to your advantage.

Collection agencies frequently accept less than full payment in satisfaction of collection accounts. It’s often easier and less expensive than pursuing full payment.

You’ll send Jefferson Capital Systems a letter proposing to settle the account for less than the full amount. Your initial offer should be 50% or less of the full amount.

If the agency is willing to negotiate, they will counteroffer with a higher number. From there, you’ll negotiate back and forth until an agreeable settlement amount is reached.

Once that happens, insist the company provide you with a letter confirming the terms of the settlement agreement.

That will include accepting the reduced payment as full settlement of the account, stopping further collection efforts, and reporting the account as paid with all three credit bureaus.

But don’t send any money until this letter is received. If you do, the company may accept your partial payment, and then continue to pursue you for the full amount of the debt.

Get Professional Help in Dealing with Jefferson Capital Systems

On the surface, at least, Jefferson Capital Systems seems like one of the better collection agencies to work with.

However, the large number of complaints filed with the Better Business Bureau, especially those alleging violations of federal law, is troubling. If you decide you need professional help, there are plenty of resources.

We recommend engaging the services of a good credit repair company. They know how to work with collection agencies and can often have your credit profile improved in the process.

If Jefferson Capital Systems threaten you with legal action, we recommend using the services of Lexington Law.

They specialize in credit law, and can often keep an account from turning into a lawsuit.

If you are overwhelmed by dealing with negative entries on your credit report,
we suggest you ask a professional credit repair company for help.

Ask Lex Law for Help

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Prevent Loan Scams provides guides, reviews & information to help consumers through every restorative step of their financial journey.

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