If a collection account appears on your credit report from a company called Phoenix Financial Services, or if they attempt to contact you about a debt, you’ll need to do what you can to get the account settled.
One of the issues that make Phoenix Financial Services more difficult to deal with than other collection agencies is the type of debts they work to collect.
These largely include obligations owed to government agencies and student loan lenders, which may be more difficult to clear up through the usual means.
It may be necessary to get professional assistance from a credit repair company to level the playing field.
If you do have a collection account, or if you are contacted by Phoenix Financial Services, don’t ignore it.
Even if you think you don’t owe the debt, you’ll still need to do whatever is necessary to clear up the account.
This will require a series of steps if you decide you want to deal with Phoenix Financial Services on your own.
We will list those steps in this article, and make necessary recommendations to get professional help should that become necessary.
About Phoenix Financial Services
Based in Indianapolis, Indiana, Phoenix Financial Services, LLC is a relative newcomer to the collection industry, having only begun operations in 2014.
They refer to themselves as a “results-oriented revenue cycle management firm,” which translates into “collection agency” if they’re trying to collect a debt from you.
The company reports being involved in recovery efforts of medical and student loans, as well as tax and government obligations.
That means the debts they are attempting to collect may carry more weight than typical retail collections.
It may also mean they’ll be less willing to negotiate and settle a debt with you.
Is Phoenix Financial Services Legit?
Phoenix Financial Services has a Better Business Bureau rating of “B” on a scale running from A+ to F.
That means Phoenix Financial Services is a legitimate collection company.
However, the BBB also reports 372 consumer complaints against the company within the past three years, which is a high number of complaints for a relatively new collection agency.
It’s something to be aware of when you are dealing with Phoenix Financial Services. They may not be the most cooperative collection agency in the business.
How to Deal with Phoenix Financial Services
If you’ve never dealt with a collection agency in the past, the process can be amazingly complicated.
That’s partially because the burden of proof will be on you even if the debt is not yours.
Another complication is that collection agencies tend to be single-minded.
Since you’re not their client, they have little to gain by attempting to please you. Their sole purpose is to get you to pay up.
To deal with that reality, you’ll need a series of strategies.
Which ones you’ll use will depend on the specifics of the collection situation with Phoenix Financial Services.
Phoenix Financial Services isn’t one of the easier collection agencies to deal with.
Please read the steps below carefully, and decide whether you want to take on the challenge or turn it over to a credit repair service.
Avoid Telephone Communication
Unless you’re a skilled negotiator, you can’t possibly come out on top in a phone conversation with a collection agent.
They are experienced in keeping you off balance and encouraging you to make payment promises you will not be able to keep.
What’s more, phone conversations with collection agencies are invariably recorded.
That’s because they can be used as evidence against you in a lawsuit.
Never call Phoenix Financial Services, and if they call you, provide no information—and make no promises.
Your sole job in any interaction with the company will be to gather information for your own purposes and not to provide any to them.
Continue Communication in Writing
You can legally request that Phoenix Financial Services restrict all communications to written correspondence.
This will be to your advantage because it’s much easier to provide a controlled and limited response in a letter than during a phone call.
Corresponding by mail has another major advantage, in that it will provide you with a paper trail of all communications with Phoenix Financial Services.
If the company threatens you with a lawsuit, you may need to rely on that paper trail for evidence in protecting yourself.
Be sure that any letters you send to the company are sent by certified mail, return receipt requested.
That will confirm any letters you send got to their intended destination, as well as provide proof of settlement efforts on your part.
Demand a Debt Validation Letter
A collection agency can’t just declare you owe money without evidence that you actually do.
Under federal law, you have a right to demand what’s known as a debt validation letter from Phoenix Financial Services.
A debt validation letter should provide all information concerning the debt, including the name of the original creditor, the date the account went into collection, the amount of the debt, and information that clearly connects you to the obligation.
Many collection accounts are either a case of mistaken identity or the result of clerical errors.
For example, the company may be attempting to collect a debt from you that’s actually owed by someone with a similar name.
Alternatively, there may have been errors in entering the information, such as turning a paid account over to a collection agency.
If you can prove either situation to be the case, you should be able to get Phoenix Financial Services to delete the collections from your credit report and close the case.
If You Have Paid the Debt: Request a Goodwill Deletion
There’s no guarantee this will work, but it’s always worth trying.
For this to have any chance of working, the debt will have to have been paid in full, and you’ll need to politely explain in the letter that the debt was the result of extenuating circumstances.
That could include a lack of funds due to the loss of a job, a business failure, a medical event, a divorce, or some other situation that was beyond your control.
You’ll need to explain all that in the letter, as well as provide a request that Phoenix Financial Services remove the collection account from all three major credit bureaus: Experian, Equifax, and TransUnion.
If You Have Not Paid the Debt: Offer a “Pay-for-Delete” Agreement
This is a strategy you might try if the full amount of the collection is still outstanding and you have the funds to pay it off.
You’ll send Phoenix Financial Services what’s known as a pay-for-delete letter in which you’ll propose paying off the entire balance owed in exchange for the collection being deleted from all three credit bureaus.
If Phoenix Financial Services is particularly anxious to settle the account, they may agree to the arrangement.
Once again, this kind of settlement will almost always require that you make full payment of the amount owed. A partial settlement will usually not be sufficient to get a pay-for-delete arrangement.
And another very important factor to keep in mind with pay-for-delete: it’s not a legally binding agreement!
Phoenix Financial Services might accept the arrangement, and even agree in writing, but they are not legally required to honor the request.
They could agree to the arrangement, accept your payment, and refuse to delete the collection account from your credit reports.
You would then have no legal basis to challenge that outcome.
That doesn’t sound fair, does it? But, the reality is that collection agencies are out to collect on debts through just about any means possible.
That includes making agreements with you that are not legally binding.
In the arrangement creditors and collection agencies have with credit bureaus, they are obligated to report a collection account as fully paid.
But, the account can remain on your credit report as a paid collection for up to seven years from the date it first went into collection status.
Never Make Promises
It’s not unusual for debtors to make promises of payment to collection agencies, thinking that’s a quick way to get rid of them.
But, it only gets rid of them for a short time. When it becomes clear your payment is not coming through, the collection agency will be back to hounding you for payment.
And, there’s a darker side of an unfulfilled promise of payment.
If you tell a collection agency you’ll send money and you don’t, they can use that as evidence against you in a lawsuit.
Never promise to send money to a collection agency unless you are willing and able to provide it.
If The Debt Is Not Yours: Demand Deletion
If Phoenix Financial Services can’t verify the debt, or provide full details of the obligation, you can demand they remove it from your credit reports and stop pursuing you for payment of the debt.
However, not all collection agencies are legally compliant in this regard.
But, if they send you a partially completed debt verification letter, or can’t supply one at all, you can dispute the account directly with the three credit bureaus.
They’ll investigate within 30 days of your dispute, and if Phoenix Financial Services similarly fails to provide complete information or any information at all, they’ll remove the collection accounts from your credit report.
However, be aware that even if the credit bureaus delete the information, Phoenix Financial Services may continue attempting to collect the debt.
Know Your Rights
The Fair Debt Collection Practices Act (FDCPA) provides consumers with certain protections from collection agency abuses.
You can learn these protections by reading the Debt Collection FAQs provided by the Federal Trade Commission (FTC).
Just knowing your rights under federal law can give you the upper hand when a collection agency starts getting ugly.
Get Professional Help
Going head-to-head with a collection agency is far from the easiest challenge life can throw at you.
Collection agencies have one focus, and that’s to get you to pay your debt. That makes it easier for them to play hardball.
If you decide you don’t want to handle Phoenix Financial Services personally, or if you start out and hit a roadblock, you’ll need to get professional help.
That means hiring a good credit repair company. They specialize in dealing with collection agencies and have experience with getting negative information removed from credit reports.
If Phoenix Financial Services threatens you with a lawsuit, you may need to get legal representation.
Try Lexington Law, which specializes in credit law. They may be able to prevent a lawsuit from ever getting to court.