| Wednesday, April 19, 2000 - 11:41 am |
I have an $800 charge-off account that is between three and four years old that I owe to a health club. I need to get this off my credit report now so I can get a loan.
I owe it from a 3-year contract I signed (when I stopped going I stopped paying). I have other debts that I am willing to pay but I feel that this one is bogus (it hurts too much to pay that much money for services I never used -- and I think it's wrong for them to have that option when they know that NO ONE will go for 3 years). So, ideally I want those @#$^ to remove the "charge-off" notation from my account and not pay them a dime. If I have to maybe pay them a little.
I think it's too late to get them for the fair debt collections act violations acts they did (statute of limitations 2 years, I think). can I still get them for fair credit reporting act violation?
I know the statute of limitations for contracts is 4 years. If I contact them before it's over will they "get" me?
If I try to take them to better business bureau arbitration will they care at all?
| Wednesday, April 19, 2000 - 12:47 pm |
Wait for it to be 4 years, and then challenge it as being beyond the SOL. Don't pay them anything now, or the clock starts all over.
| Wednesday, April 19, 2000 - 09:17 pm |
You signed a contract for 3 years. If you didn't think you would use the services for 3 years why did you sign the contract?
You bought the service. It doesn't matter if you used it or not. I would definitely side with the health club on this one.
I don't like health club contracts either. However, if you signed a contract and made a commitment, I don't think there is much you can do. My suggestion would be to pay the debt and move on.
| Thursday, April 20, 2000 - 12:46 pm |
Mark's advice is very, very bad. If you can avoid them for another year (that's how long until the SOL is up, right?) then you should do so. Use your rights, don't let them use you.
| Thursday, April 20, 2000 - 03:10 pm |
Health clubs are notorious for suckering people into signing those contracts.
Once I even had a mortgage underwriter remark that they would not consider a health or fitness club collection/charge-off a big deal. HOWEVER, this was just ONE underwriter and 5 years ago, so since we now have credit scoring it is a big deal.
Since paying the debt won't increase Credit Scores, I'd wait too. If it must show paid for a mortgage, try to negotiate removal from the credit report.
| Thursday, April 20, 2000 - 03:38 pm |
Mark's advice is very, very bad. If you can avoid them for another year (that's how long until the SOL is up, right?) then you should do so. Use your rights, don't let them use you.
Please tell me why Iím wrong, not just that Iím wrong. Iím very open to input and Iíd like to learn too. Also, if you donít mind, could you please use your name so I know who Iím talking to. Here is why I said what I said:
1. What is the objective? If the objective is to try and not pay the bill, then it may be better to wait until it drops off of your credit report. If the objective is to get a loan now, then you need to take care of the debt now by either paying it or challenging it. If you wait a year like you suggest, then you donít accomplish the objective which I would conclude is bad advice. Halleahís Quote: ďI need to get this off my credit report now so I can get a loan.Ē
2. SOL. What does this mean anyway. I really donít know. Here is my interpretation. Lets say you have a legitimate bad debt and the creditor waits until after the SOL to report it. Then I would say the creditor is wrong because they reported the debt after the SOL. However, if they reported the debt before the SOL, then it is a valid blemish on your credit report. Anonymousís Quote: ďWait for it to be 4 years, and then challenge it as being beyond the SOL.Ē I donít see how you could go after a creditor if they reported the debt before the SOL was up. Sounds like the creditor followed the book. In Halleahís case, it sounds like the creditor reported the bad debt before the SOL.
3. Is this a valid debt? Sounds like it to me. Halleah signed a contract obligating her to pay for a service. If she chose not to use the service, she still has to pay for it. I think she should have gone to the health club and negotiated a termination of the contract if she decided she didnít want the service anymore. Too late now.
4. Anonymousís Quote: ďUse your rights, don't let them use you.Ē I think that is what the creditor is doing.
5. Halleahís Quote: ďIf I have to maybe pay them a little.Ē I think this is the best solution to get the loan Halleah wants NOW. Not a year or two from now.
Again, Please tell me why Iím wrong in my reasoning, not just that Iím wrong. I look forward to your response.
| Thursday, April 20, 2000 - 05:35 pm |
If you note, this is my name. It's AnonyMOUSE - not anonymous. You have some valid points, but I think you are missing the most important point, point 0.
0. This is not a site that advocates paying "the establishment" when "the establishment" is perceived at evil.
I doubt very seriously that you will get Christine to differ on that point. She has said on many occasions that this is a consumer ADVOCACY site, and as such not to expect that business will get fair treatment here. What they did was "wrong/evil" and as such, they get no sympathy. What did they really loose? Was the equipment used, and not paid for? No. Was time or resources devoted that could not be used by another? No. What really did they loose by him not paying? Nothing. So why should she pay it???
No one here cares if it's a "valid" debt. Oh, and SOL is Statute of Limitations. Once a debt is beyond that point, reported or not, it becomes non-collectable, short of a court order. In some states, even a court order has a SOL, although usually one can just go back to court before that and have it extended, making them virtually infinite. That's not the case here however. There doesn't appear to be a court order. Once it's beyond the SOL, she CAN and SHOULD dispute it, removing it from her credit report.
No one here cares about the creditors rights. You're on the wrong forum if you think that's what this place is about.
Bottom line: She should either wait for the SOL to be up, or offer them 50% or so to settle, and have them agree not to discuss the matter with any third party. She needs to get that agreement from the GYM on company letterhead, signed by someone with authority, I.E. a company officer. Then, once she settles the debt, she disputes it. Having signed an NDA with her, the GYM cannot verify, and it drops off, getting her the clean credit she needs for her loan - some will not go for this, particularly on a low dollar amount debt. Still, it's worth a try. That, or wait, as I suggested.
| Thursday, April 20, 2000 - 06:42 pm |
Obviously this isn't a site for businesses wanting to learn how to collect debts. But I'm also not advocating that everybody stop paying their debts.
I have NO idea why health clubs would have 3 year contracts other than to make a lot of money off people who will NOT use their services/equipment.
It's a very common real estate practice to sell land over and over. The *no qualifying* 10-10-10 is the only way land is sold in many areas. But at least the people who don't want the land (payments) anymore can just give it back.
They lose the 10% down and the payments made, and that's it. I've never seen anyone sue for the rest of the payments.
Aside from my low opinions of health clubs, consumers need to know that they have LEGAL rights, no matter who and why they owe. If they don't have the money, they don't have to pay.
I wouldn't mind changing that, for both consumers AND corporations, holding corporate officers personally liable for corporate debts.
| Thursday, April 20, 2000 - 08:10 pm |
I miss-interpreted the purpose of this site. I thought the purpose of this site was to help consumers improve their credit, especially in the face of creditor fraud.
I'm not trying to give the creditor sympathy nor stand up for their rights. I'm on the side of the consumer, especially when the creditor has committed fraud or violated consumer protection laws. However, I don't advocate skipping out on all your debts simply because you view "the establishment" as being bad or evil, especially when you are trying to prove your credit worthiness when applying for a new loan or line of credit.
Thank you for clarifying your point on the SOL. I can understand the strategy of waiting until the SOL expires and then having it removed from your report. However, I'm also of the opinion that it would be better to negotiate at least a 50% payoff today and save at least that much in lower interest rates over the next year or two while you wait for the SOL to expire if it is your goal to get a new loan now. I'm also of the opinion that if you continually look for the best way to skip out on paying your debts you will always have bad credit and you will never get the loan your looking for.
I agree, I also don't like it when health clubs push for expended contracts like 3 years, especially when they know a consumer is not planning on using their services for the full length of the contract. However, I don't think its evil. They are simply running a business. I have to put some of the blame on the consumer. Health clubs also offer a month to month agreement. You can stop paying at any time. Why would a consumer want to sign a long term contract. Simple, they get a huge price reduction because they made a long term commitment. Yet, the consumer wants the best of both options. They want the month to month agreement and the decreased price. I signed a 3 year contract myself. However, when I signed I knew what I was signing. I use the gym 3 days a week each and every week and plan to for the length of the contract. I can also get out of my contract for a fee, so I don't think that its all bad because I benefit from a lower monthly payment.
| Friday, April 21, 2000 - 11:38 am |
Hey, I figgure I"m already in shape. I'm ROUND. :-)
| Friday, April 21, 2000 - 12:55 pm |
And to Mark: I appreciate your comments. I wonder how you feel about the ads? Are they part of the contract? Should they be? Aren't there a lot of implied promises, deceptive and misleading ads?
Why are those promises EXCLUDED from the contract? I think that every ad should be attached to the contract.
However, we're supposed to KNOW that the ads are lies.
I can't feel too bad for the health club when they don't get paid.
The health club knows that a certain percentage will not pay, just like a certain percentage of their customers isn't going to lose weight.
It all works both ways.
Personally, I might have contracts, yet, I don't necessarily enforce them. Especially when it doesn't cost me any money. There is NO WAY I would charge someone for something they don't use!
When I have a lease and the tenant wants out, I'll do my very best to rerent. Even when I do lose money (I've made my share of bad loans) I rarely pursue individuals. They'd pay me if they could.
I don't get rich doing business this way, but I sleep better. It's bad karma to get something for nothing from another human being, especially when that person is poor or ill.
| Friday, April 21, 2000 - 01:56 pm |
I'm getting really tired of people E-mailing me.
Why didn't Michael C. Shanahan, apparently with some "nationwidemtg," post his comments himself?
Date: Fri, 21 Apr 2000 14:20:56 -0700
From: "Michael C. Shanahan"
Subject: Re: Credit: Major health club chain are crooks
Another whinny, gutless, pathetic liberal, always crying about the CORPORATIONS ripping everybody off. Here's an idea, ready, if you don't like the contract, don't sign it to begin with.
Of course that would mean PERSONAL RESPONSIBILITY without anyone to blame but yourself. We all know that when your a whinny, gutless, pathetic liberal that everything is everybody else's fault but yours.
I know, let's have the Government help us out. Pass some new laws, take away some more freedom and liberty, just so you don't have to be responsible.
| Friday, April 21, 2000 - 08:17 pm |
I think one of the biggest problems with businesses these days are their ads. They are very misleading. I find myself continually trying to sift through the garbage in today's advertising to find the companies I choose to do business with. I don't pay much attention to the health club ads, so I really can't comment on them specifically.
About the ad being included in the contract -- I would say no to the actual ad itself because they usually don't contain the proper language for a binding agreement. However, I would agree that the guarantees in the ads should be included in the contract.
Christine's Quote: "Personally, I might have contracts, yet, I don't necessarily enforce them. Especially when it doesn't cost me any money."
I strongly disagree. When I have a contract with someone I enforce it very strictly, and I expect the other party to enforce it strictly, otherwise, why have the contract. If a conflict arises and there is a need to have the contract changed, then change it (if it makes sense). A contract is simply our agreement put in writing and if we can't put it in writing, why have the agreement.
"There is NO WAY I would charge someone for something they don't use!"
Again, I disagree. If I setup an email server and a client requests hard drive space and use of my bandwidth for his email and he chooses not to send any email, I'm still out the hard drive space and bandwidth I dedicated to that customer. I still have to pay the electric bill to have the computer up and running ready for his use at any time. It was his choice not to use the service.
Christine's Quote: "When I have a lease and the tenant wants out, I'll do my very best to rerent. Even when I do lose money (I've made my share of bad loans) I rarely pursue individuals. They'd pay me if they could."
I also lease property to tenants. When a tenant wants out of my lease, I expect them to give me proper notice and I charge one months rent as a release fee. However, if they are willing to help me re-rent the property (i.e.. keeping the house clean, allowing me to show the property to prospective tenants, ...) I waive the release fee.
When a tenant has trouble paying rent I expect them to communicate to me. As soon as they are going to have a problem, I expect them to let me know so there are no surprises. If they communicate with me, I will do everything I can to help them. If it's a temporary problem I'm even willing to let them spread their payments over time (and I don't even charge interest). If its a permanent problem and they can't pay then they can't stay, it's that simple, and I will help them find a new place. If a tenant doesn't communicate with me, and continually avoids me, then I enforce the contract according to the letter of the law.
Christine's Quote: "I don't get rich doing business this way, but I sleep better. It's bad karma to get something for nothing from another human being, especially when that person is poor or ill."
I do expect to get rich doing business, otherwise, why am I in business. Christine, you aren't getting something for nothing, your getting your compensation for providing a good product to the consumer. I think its bad karma when you immorally take advantage of people by not providing the service or product that you agreed to provide.
Christine, what's the difference between the Tucson Realty and Northern Trust case posted in the real estate section - or - your tenant not paying your for a service you provided? In both cases someone is taking advantage of you. The difference is who's taking advantage.
| Saturday, April 22, 2000 - 10:16 am |
well folks, I guess I consider myself propery chastised. I guess I was more or less "venting" rather than making any kind of inciteful comment. so here are my thoughts on the topic: do I think the agreement should be enforced legally -- yes, I do -- do I think it's somwhat ingenuine of the health clubs to have 3-year contracts -- maybe. I guess that depends on how many people are actually going after 3 years. If only a very small percentage still attend for that whole time, then the contract really is not what the health club represents it to be ($20/month for 3yrs), it's really $60/month for one year. and yes, I do agree that my scheming and plotting to outwit the system was a little unsavory -- my only defense is that I really felt this contract was bogus. so the bottom line is this: each INDIVIDUAL has free-will to sign that health club contract or not, but when the 3-yr-contract-policy is considered in its aggragate effect -- it may not be a good policy overall. if it makes you feel any better, I already set up a payment plan with them.
| Saturday, April 22, 2000 - 12:15 pm |
That doesn't make ME feel better.
As far as Mark's comments go, well, he is quite normal. MOST people go into business to get rich.
Originally I got into business because I like to do my own thing, different things. Holding a job was BORING while the office politics were aggravating. I just don't fit into the corporate world.
I got into the real estate biz because I couldn't find a competent and honest agent. Then I got into the mortgage business because my clients got consistently screwed by banks and mortgage brokers.
Next I got into the credit business because my clients got screwed by the CRAs and creditors, and then Fair Isaac.
Then I was out of business when I got blacklisted by Experian.
So now I haven't done any business in years and sooner or later I'll be broke. Getting rich is definitely not MY goal.
Mark wrote: "Christine, what's the difference between the Tucson Realty and Northern Trust case posted in the real estate section - or - your tenant not paying your for a service you provided?"
The difference is that Tucson Realty and Northern Trust don't have cancer, didn't lose their job, their kid isn't in the hospital, their bank account isn't empty. They're just pursuing their goal to get rich by defrauding consumers.
If it turns out that Northern Trust is a one man shop, and the man's wife or kid needed a life saving surgery and that's what he used the 20K for, well, I'd be talking different then.
From all I've seen, that's not the case.
I recall only one tenant who didn't pay as agreed, so after a few months I made her move out. She had MS and I made no efforts to collect. She actually voluntary paid a few hundred after the move. She's neither rich nor poor, but I figure she's got enough problems as it is.
I certainly try to get payment when I feel somebody is taking advantage of me, fortunately that rarely happened.
I have NEVER had a credit client not pay me. I've NEVER had to ask for payment other than telling my clients how much the total was.
Working as mortgage broker, the law prohibited me from charging for my services unless the loan closed.
That's why I quit doing loans. If I have to sell someone a loan they don't need or that's not good for them in order to get paid, I want nothing to do with it.
We had some intense discussions on morality at http://www.bayhouse.com/discus/messages/4/102.html?SundayDecember2619990722pm
Sean posted there:
"As for dealing with Hitler, if he loaned me 5000 marks and I agreed to pay it back with 10% interest in a year and I showed up at the end of the year with 5500 marks to pay and he said to me, "Hey that's great ... I need the money to buy an oven to fry Jewish people in." then YES, I would still pay as agreed. "
Well, I'm on the other end of the spectrum. I'd be actively trying to kill him and I'd applaud and support anyone else who tried. Certainly the last thing I'd do is pay debts I owed to Hitler.
We all have our own values based on our own experiences. Personally, laws mean nothing to me. Some are good, some are bad.
Most laws aren't enforced unless it PAYS (speeding tickets), and I learned that legal rights only exist for the people who can afford competent lawyers.
Part of the purpose of this forum is to help consumers finding out what their legal rights and obligations are without hiring a lawyer that they can't afford anyway and who might not even give good advice.
The fact is, nobody HAS to pay any debts if they don't have the money/assets to pay.
We have no debtors' prison.
| Monday, April 24, 2000 - 01:40 pm |
You wrote "There is NO WAY I would charge someone for something they don't use!"
Again, I disagree. If I setup an email server and a client requests hard drive space and use of my bandwidth for his email and he chooses not to send any email, I'm still out the hard drive space and bandwidth I dedicated to that customer. I still have to pay the electric bill to have the computer up and running ready for his use at any time. It was his choice not to use the service. "
This is not analogous to the situation with the health club at all. The body not being there, not using the space or equipment doesn't deprive the club of anything at all. Many clubs over sell memberships, and try to expand if things get crowded - so it didn't cost them anything.
You also said "I do expect to get rich doing business, otherwise, why am I in business. "
Which is both amoral and un-ethical. People like you are "The Enemy" as far as I'm concerned. You should get an honest days pay for an honest days work - just like every other working stiff.
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