FICO is "the F word" to me ...

[Broland]

Sorry for the length of the intro to this ... it is germain to the issue. Hopefully, someone in this forum can help!

Three years ago I purchased a new phone from Samsung and sent in my old phone for a trade-in value of $150 and I paid cash for the delta. A couple of months later I received notification they rejected my phone as not meeting their criteria (I thought it was in very good condition). I contacted Samsung immediately and requested a return of my phone and I'd gladly pay the $150. They refused and they now have my good phone and want another $150.

Subsequently, TD Retail (the financing arm of Samsung) set up an account and wanted me to pay the $150. I made several calls trying to explain the situation to no avail. I can easily afford the $150, but now it's the principle of the matter to me ... no need for the lecture on that ...

Here's the issue. Suddenly a $275 debt appeared on my credit report earlier this year and sent my FICO from ~835 to ~735. I have exemplary credit (other than this), and have no debt, put everything on my credit cards and pay them off every month etc etc etc.

After investigating, it turns out TDR wrote this off and resold the debt to some third party scavengers, hence the now $275 debt. Now with my "tail between my legs" for not understanding earlier that this was a battle I could not win I call the third party scavengers, say I'll gladly pay the $275 immediately if they will delete the item off my credit report.

They said they cannot and I must get Samsung to agree to the deletion. I call Samsung, they said as far as they're concerned I owe them nothing (I guess because they wrote off the debt) and to contact TDR. Of course they won't do anything either because the scavengers now own the debt.

The scavengers will gladly accept the $275, but will only put on my credit report that the debt is paid off ... but all the delinquencies will remain. They will do nothing more. I cannot believe with the exemplary credit I have, no debt, no lates etc etc that this simple small amount of money can destroy my credit so badly.

As an addendum, I have made the challenge to the credit agencies several times from several different perspectives all to no avail.

Any suggestions from you smart folks?

 

[teetee]

You tried to avoid debt but it still screws you over. Imagine those poor souls not know any better and try their best going into debt.

I don't have a good suggestion (never traded in anything before hoping to get a good deal). You are dealing with a big corp and a scumbag, neither of them have the ethics to treat you right. Perhaps you can contact Samsung support team and ask for another manager to take your case? Keeping your phone and not giving you the trade-in money is called stealing.

Not worrying about credit score up or down will help to calm you at some degree, at least the credit agencies in this case is innocent. After they are not your friend to beging with.

 

[Gumby]

Google "Fair Debt Collection Practices Act". * It controls what a third party debt collector can and cannot do to collect a debt. Challenge them to prove, in writing, that you owe the money. That may not be so easy for them to do since Samsung did not send your old phone back.

* here's a start for that https://www.consumer.ftc.gov/articles/debt-collection-faqs

 

[JRon]

Why do you care about your FICO? I haven’t borrowed money for years except for using a credit card and don’t care one bit what my score is. I would never pay that bill as they had no right telling you the phone was worth less 3 years later.

 

[erkevin]

I like a high FICO for several reasons (even though I dont carry any debt or loans). I like being able to qualify for great credit cards that offer perks and your FICO score may impact your auto insurance rates.

 

[Chuckanut]

Google "Fair Debt Collection Practices Act". * It controls what a third party debt collector can and cannot do to collect a debt. Challenge them to prove, in writing, that you owe the money. That may not be so easy for them to do since Samsung did not send your old phone back.

* here's a start for that https://www.consumer.ftc.gov/articles/debt-collection-faqs

Often bill collectors will buy old debt, sometimes beyond the age where they have a legal right to collect it, and then demand payment. My guess is they bought the supposed debt for pennies on the dollar. If they get even 10-20% to pay off the debt, the return is substantial.

Warning! If you pay even a penny on the debt the statute of limitations my start again from zero. Not so good.

 

[wolf]

Stick to your guns. Don't pay anything. Right is right.....

Eventually, your FICO, will return to "normal".

Worst case, if you are making a major purchase, just explain what happened.

If whomever you are dealing with will not listen......Walk....IMHO

 

[euro]

I like a high FICO for several reasons (even though I dont carry any debt or loans). I like being able to qualify for great credit cards that offer perks and your FICO score may impact your auto insurance rates.

Maybe, but 735 is still a pretty darned good score, so I really doubt you will miss out on much. move on - life is short

 

[Walt34]

Eventually, your FICO, will return to "normal".

This.

In the meantime politely suggest that they pound sand.

 

[Broland]

I do care about my FICO because it does help with some of my financial decisions. For example, I need a new truck. I could pull IRA money out, pay cash and lose any potential gains, OR get a 0% loan (based on FICO score). Or as erkevin notes, there are some really good offers for "excellent credit people". Guess I'm kinda "frugal" ... we have sufficient means to purchase what we need and want, but I always try to optimize how I spend my money. I'm shocked that FICO is so important in our economic system, yet a "little ding" can so strongly affect your perceived value to the borrower.

I will add that my irritation is so great because when I say "little ding", I think a $275 hit against someone who averages 5-10K spend on credit cards each month (I LOVE the cash back on some of my cards ... yes, I'm frugal!) AND pays them off each month is absolutely ridiculous. Sorry for the rant ...

 

[clobber]

I recall listening to a NPR (Planet Money?) episode about debt collection. Apparently, many times debt collectors only have a spreadsheet that lists who "owes" what. They don't have any of the documentation that supports it - signed forms etc. I always thought that if I got in a situation like yours (ugh) I would tell them I'm happy to pay if they just prove what I owe.

 

[youbet]

I recall listening to a NPR (Planet Money?) episode about debt collection. Apparently, many times debt collectors only have a spreadsheet that lists who "owes" what. They don't have any of the documentation that supports it - signed forms etc. I always thought that if I got in a situation like yours (ugh) I would tell them I'm happy to pay if they just prove what I owe.

To the extent that the collection agency, or the original debt holder, can ding you with the credit rating agencies, that's their only lever. When you say "I would tell them I'm happy to pay if they just prove what I owe" you really are accomplishing nothing. They're still going to run you through their normal tactics. And you still don't have to pay unless they get a judgement on you which, for small, undocumented amounts, isn't going to happen.

The issue is avoiding or reversing the credit rating ding.

Personally, I think it's too easy for creditors to submit negative inputs to the credit agencies and there seems to be no consequences to them for being wrong.

 

[teetee]

I do care about my FICO because it does help with some of my financial decisions. For example, I need a new truck. I could pull IRA money out, pay cash and lose any potential gains, OR get a 0% loan (based on FICO score). Or as erkevin notes, there are some really good offers for "excellent credit people". Guess I'm kinda "frugal" ... we have sufficient means to purchase what we need and want, but I always try to optimize how I spend my money. I'm shocked that FICO is so important in our economic system, yet a "little ding" can so strongly affect your perceived value to the borrower.

I will add that my irritation is so great because when I say "little ding", I think a $275 hit against someone who averages 5-10K spend on credit cards each month (I LOVE the cash back on some of my cards ... yes, I'm frugal!) AND pays them off each month is absolutely ridiculous. Sorry for the rant ...

Then you are just kidding yourself that you don't take debt. Borrowing money is the major reason why you value FICO score so much.

FICO score is only important in the eyes of the borrowers. Not to people who use cash. I think you are in this borrowing mentality too deep to change just like majority of the population. It fattens the lenders bonus and do no good for the economy as a whole. You think you know the best way to use money by leveraging debt, the truth is you invite yourself to risks like the hot mess you are in right now. Not the same but just one paperwork error or someone not competent enough in the pipeline can result you sleepless nights.

 

[RobbieB]

I have never worried about FICO and I never will.

Just like budgeting and balancing a checkbook. Never did it and never will.

 

[jazz4cash]

Maybe, but 735 is still a pretty darned good score, so I really doubt you will miss out on much. move on - life is short

That's what I was thinking... the suggestions to preserve your rights by understanding and following the FDCPA are spot on. I'll spare everyone from my Fico=SCAM rant, but OP seems to have bought into the phony thinking that the FICO tail wags the credit dog. I don't think OP will have any issues due to a 735 score. Put a note on the file and move on.

 

[Koolau]

Not sure what a "bad" score is or what it will do to you, but I can assure you that back in the early teens, a "good" score wasn't worth snot. Back then, it was all about income. My FICO was around 820 and MY bank still wanted 50% down on a mortgage. (Whole story relayed elsewhere in these pages.)

I DO think it should be easier to go after the credit-evaluation companies AND those who turn you in as being a credit risk. NOW, you have to prove you are innocent rather than the other way around. YMMV

 

[teetee]

Not sure what a "bad" score is or what it will do to you, but I can assure you that back in the early teens, a "good" score wasn't worth snot. Back then, it was all about income. My FICO was around 820 and MY bank still wanted 50% down on a mortgage. (Whole story relayed elsewhere in these pages.)

I DO think it should be easier to go after the credit-evaluation companies AND those who turn you in as being a credit risk. NOW, you have to prove you are innocent rather than the other way around. YMMV

That good old times you described is when the manual underwriting was still popular: the loan officers actually did their due diligence to verify your figures and obtain the realistic debt-to-income ratio.



Nowadays with a name and the FICO score you get to borrow money. Then comes the subprime loans, then comes the 2009 recession. Then comes people still can't learn from their mistakes.



The whole credit score methodology taps into human psych from multiple angles. The majority of the consumers had zero chance to fight it. They think they are being sophisticated by counting the rewards or miles or by saving 5% cashback of their purchases, or like several posts in this forum about money that they get better return when the borrowing interest rate is low. All of those, after adding in the risk factor, suddenly they don't look as good as on paper. It doesn't matter if you are good at math or are principled on your spending, what they are doing is using people's greed and blind-spot to get you into debt, then take advantage of how easy people lose their status quo (losing job/income or having emergencies) and prey on them via outstanding interest rates / fees / debt collection tactics.

 

[audreyh1]

In dealing with Apple, any credit for a trade-in occurs after the fact. They credit the payment method you use. And yes, once we had a problem, and they sent the device back because the screen had started coming apart which we hadn’t realized.

 

[38Chevy454]

Crazy idea here: what about suing Samsung in small claims for breach of contract or theft of goods? Get the judgement and force them to not only return your phone, but also to remove the credit ding. You represent yourself, no need for a lawyer. Just present the facts that Samsung had an agreement, then didn't give the money credit and never returned your phone. Subsequent actions as a result may or may not give any relief, but at least you would have some legal documentation to show you have been judged correct?

 

[austin944]

Were the terms and conditions you signed three years ago anything like the current terms they have, quoted below? If so, then it sounds like Samsung is not obligated to return your old phone.

"If your Trade-In Device is rejected, Samsung may, in its sole discretion, offer to return your Trade-In Device to you, subject to the following conditions and any others that Samsung may specify to you at the time of such offer to return:"
https://www.samsung.com/us/trade-in/terms-and-conditions/

 

[Broland]

38Chevy454 ... LOVE that year/model ... fond memories with Dad for me (many, many years ago). I do (kinda) like your thoughts ... might go for it.

austin944 ... good question. I don't have that documentation. I have a LOT of stuff I saved, but unfortunately a couple of the key documents I neglected to keep.

I appreciate all the thoughts, sounds like a no-win situation unless court works out.

 

[jazz4cash]

I recall listening to a NPR (Planet Money?) episode about debt collection. Apparently, many times debt collectors only have a spreadsheet that lists who "owes" what. They don't have any of the documentation that supports it - signed forms etc. I always thought that if I got in a situation like yours (ugh) I would tell them I'm happy to pay if they just prove what I owe.

That’s the right idea. The bar for collecting a debt is much higher when it has been sold to a 3rd party. I think it’s called debt validation according to the Fair Debt Collection Act. If you insist on proof chances are the collector will just move on to harass someone else.

 

[CoolRich59]

This.

In the meantime politely suggest that they pound sand.

My feelings exactly.

A medical lab didn’t get the preapproval my insurance company required, so they didn’t get paid and they came after me. I told them to go pound sand.

My FICO score took a hit, but I didn’t care. I was FIRE’d and not planning on buying a house or a car anytime soon; a year later my score was back over 800.

 

[CoolRich59]

...there are some really good offers for "excellent credit people". ...

You might be surprised.

Even though I said in my previous post I wasnt planning on buying a car, my car situation changed and I did buy a car after the FICO hit. My score was still high enough that I qualified for the best rate.

I even joked to the dealership’s finance manager “I guess that uncollected debt didn’t hurt me too much.” She was so surprised that she actually looked it up and found it on my report. She said once she saw my score, she hadn’t bothered looking any further.

 

[euro]

You might be surprised.

Even though I said in my previous post I wasnt planning on buying a car, my car situation changed and I did buy a car after the FICO hit. My score was still high enough that I qualified for the best rate.

I even joked to the dealership’s finance manager “I guess that uncollected debt didn’t hurt me too much.” She was so surprised that she actually looked it up and found it on my report. She said once she saw my score, she hadn’t bothered looking any further.

Glad it worked out for you. I’m not surprised - as I said, 735 is still a stratospheric credit number by most standards. I have pretty stringent rules of acceptance for new tenants in my rentals but like your car dealer, when ai see a “7” as the first digit, I stop paying attention. Automatic yes (barring any background check issues, of course....)