Midland Credit Management, Inc., is a third-party debt collector based in San Diego. The collection agency buys unpaid debt from creditors, often for pennies on the dollar, and then contacts the debtor to try to obtain payment and make a profit.
If your past due debt has been sold to MCM, you may be wondering how to resolve it. Read on to find out how to remove Midland Credit Management from your credit report.
Summary
How to Resolve a Collection Account with Midland Credit Management
Follow these five steps to remove Midland Credit Management from your credit report.
Step 1: Check your credit report and understand the debt
Once Midland Credit Management contacts you about an outstanding account, check your credit report. You can get free weekly credit reports from all three major credit bureaus on the official site, AnnualCreditReport.com.
Look for the collection in your report. You can see it from Midland Funding, LLC or Midland Credit Management. The two companies work together: Midland Credit Management services Midland Funding accounts.
If you believe there is an error, you have the right to dispute it. Errors can occur for the following reasons:
- Incorrect personal information (name, address or telephone number)
- Accounts listed in your report that belong to another person with a similar name
- Accounts that do not belong to you but are the result of identity theft
- Incorrect account statuses or payment dates (for example, a payment marked as late when it is not late)
- A debt listed more than once
You can dispute the error with one of the three major credit bureaus: Equifax, TransUnion, or Experian. You can also contact MCM, who will investigate the report. Once notified to MCM that it is incorrect, MCM must notify the credit reporting agencies.
Step 2: Request debt validation
The next step is to ask MCM to verify the debt. You should write a letter, called a debt validation letter, within 30 days of your first communication with this debt collector. The company must prove that the debt in question is actually yours. Request the following information for validation:
- Details about the debt, including the original creditor
- The current amount and age of the debt
- Supporting documentation demonstrating the validity of the debt
When the company responds, check the data it sends you. Are there any inaccuracies? The Fair Credit Reporting Act (FCRA) requires MCM to investigate the complaint against you. If you can prove that the complaint is invalid, the collection company must remove it from your credit report.
Step 3: Negotiate with Midland Credit Management and work out a payment plan
We recommend that you try to pay off your debt as soon as possible. You may be able to negotiate with the debt collector to settle the debt for a lower price. Collection services companies pay less than the going rate for the debt they purchase, so they can afford to take less than the total debt and still make a profit. Anything you pay above their low purchase price is a profit from their point of view.
When you enter negotiations, develop a proposal that makes sense for your budget. Calculate your income and other financial obligations to determine how much you can pay for this debt. Don’t forget to leave a pillow for emergencies. Also, consider whether you want to pay a lump sum or installment payments.
The negotiation process may involve back-and-forth communications between you and the collection agency. Once you reach an amount you are comfortable with, it is very important to get the agreement in writing. Otherwise, there will be no recorded evidence of your agreement.
Step 4: Wait for the collection to drop off your credit report
A debt sent to collections can stay on your credit report for seven years, but it may be less depending on your state. Generally, you cannot remove a valid entry from your credit report; you can only remove fraudulent or incorrect information.
MCM specifies that it does not issue reports in the first six months following the sending of the first notification to the debtor. Additionally, MCM will never report the account if the debtor begins paying their debt within the first six months and maintains the agreed-upon payment schedule until it is paid off.
After six months MCM will be able to report it to the credit agencies. However, once you pay it, the collection agency says it will request the credit bureaus to remove it from your report.
Alternative option: Work with a professional to eliminate debt
You may prefer to hire a professional credit repair company. While you can handle the process yourself, credit repair companies can review your credit report and dispute errors on your behalf.
When choosing a credit repair company, be wary of scams. According to the Consumer Financial Protection Bureau (CFPB), you may want to avoid choosing a company that displays one or more of the following warning signs:
- The company requires advance payment
- The company promises to remove something from your credit report
- The company recommends that you dispute all information on your credit report, even the correct information
- The company does not explain your rights to you
- The company tells you not to contact any credit reporting agency
Midland financing or MCM?
You may see two different company names appear on your account. Midland Funding, LLC is a debt buyer. Buys old debts from original creditors, usually for pennies on the dollar. If Midland Funding purchases your old debt, they will transfer the account to MCM to collect the debt from you. Midland Funding may appear on your credit report when you are actually dealing with MCM. If you choose to contact the credit bureaus directly about your debt, be sure to specify which company it is.
Midland Funding and MCM are part of the Encore Capital Group, along with other firms, including Asset Acceptance and Atlantic Credit Finance.
What does Midland Credit Management collect for?
Midland Credit Management collects the following types of debt:
- Consumer financial accounts
- Debt with credit card companies
- Secured and unsecured loans
- Financing with leasing
Should I pay Midland Credit Management?
If a valid outstanding debt has been sent to collections, it is in your best interest to work with Midland Credit Management to come up with a plan and pay it off as soon as possible.
What happens if I don’t pay Midland Credit Management?
You can’t ignore MCM: not paying your debt won’t make it go away and you could face legal problems.
First, the negative impact of unpaid debt on your credit score can become an ongoing burden. This could affect your ability to get credit in the future, such as a car loan, new credit card, or mortgage. You will also continue to receive phone calls and letters from MCM account managers regarding this past due debt.
Keep in mind that the Fair Debt Collections Practices Act (FDCPA) prohibits MCMs and other debt collectors from calling you at odd hours, such as late at night or early in the morning, especially after you have requested them in writing not to do so. The FDCPA also allows you to control which phone number MCM calls. Be sure to request a change to your phone number or other contact information in writing.
Will Midland Credit Management take you to court?
If you do not pay the debt, MCM may take legal action against you to collect it. If this happens, check the statute of limitations in your state related to the type of debt you have. If the deadline expires, you can get the case dismissed. These statutes vary from state to state.
To clarify, the statute of limitations on debt only refers to a debt collector’s ability to take legal action against you. You would still owe money even after the statute expired, but they couldn’t hold you accountable in court. If your first contact with MCM is recent, your debt is probably on the statute of limitations.
Money’s summary on how to remove Midland Credit Management from your credit report
Midland Credit Management is a debt collection agency. Buy debt from creditors at a low price and then contact debtors to get payment. If your debt has been sold to Midland Credit Management, follow these steps to remove it from your credit report:
- Check your credit report and understand the debt. You can write a dispute letter if you think it is a mistake.
- Ask MCM to validate your debt. Debt collection agencies are required by law to provide you with account information.
- If the debt is valid, negotiate with Midland Credit Management to arrange a payment plan that you can afford.
- Keep up with your payments and wait for the item to fall off your credit report.
You can do this process yourself, but you can also hire a credit repair company to handle it for you. If you go this route, do your research before choosing a company to avoid scams.
Disclaimer: This story was originally published on October 13, 2017 on BetterCreditBlog.org. It has been updated to reflect current information. To find the most relevant information regarding collections or credit card inquiries, please visit: