Finding negative information on your credit report or being bombarded by phone calls from someone claiming you owe a debt is unsettling, especially if you think there’s been a mistake. When you see a company like Debt Recovery Solutions on your credit report or you get letters or calls from them, you should be proactive in how you deal with it. Otherwise, you could be prevented from opening new accounts or financially moving forward. A consumer protection attorney can help if you’re facing a situation with Debt Recovery Solutions.
Debt Recovery Solutions is a third-party debt collector, also known as both DRS and perhaps listed on your credit report as Debt Rec Sol. The company, founded in 2002, is never an original creditor. Rather, original creditors will hire DRS to collect past-due debts on their behalf.
As a third-party debt collector, Debt Recovery Solutions provides contingency-based services. First, a consumer would open an account with an original creditor. Then, if they didn’t pay for a period, the creditor might use their in-house billing or financial team to collect what they owe. Eventually, the company might hire Debt Recovery Solutions to collect on their behalf, outsourcing these duties to this third-party company, paying them if they’re able to recover anything.
DRS also buys debt. When bad debt is purchased, the original creditor is saying that they are charging it off, meaning they no longer believe they can collect it. The debt buyer purchases it at a very discounted price compared to what it’s worth and then tries to move through the collection process to recover funds.
Debt Recovery Solutions collects in a variety of industries for different types of businesses, including credit card and financial services companies.
You have credit reports with the three main bureaus in the U.S.: Experian, Equifax, and Transunion. Your credit reports are incredibly important because they’re what lenders, utility companies, financial services companies, landlords, and even employers use to learn more about your financial history.
Your credit report is used to make a determination on whether credit should be extended to you and, if so, what your interest rate should be. The lower your credit score, the higher your interest rate if you get approved.
If you see Debt Recovery Solutions, DRS, or Debt Rec Sol. on your credit report, it’s a collections account. That means that a lender sold the rights to an unpaid debt to this third party. If you have a collections account on your credit, it can lead to a major drop in your score.
Collections accounts can stay on your credit report for a little over seven years from the date your account first became past-due. If you have a collections account older than seven years, it should be removed from your file.
When you have an account that goes to collections, there’s a 180-day period that starts from the delinquency date. The delinquency date is when the company that was the original creditor said they could no longer collect. The seven-year statute of limitations starts after this 180-day period, which is why a collections account can technically stay on your report for 7 ½ years.
While in theory, Debt Recovery Solutions is on your credit report because you have something you didn’t pay, there are frequent errors. The errors can occur with the original creditor. Maybe you had an account with a creditor, you kept it current and paid it off, but according to their records, you didn’t, so it went to collections.
The errors can also occur with information debt collectors report to credit bureaus. For example, if a debt collector is getting you mixed up with someone else, you might have a collections account on your credit that doesn’t belong to you at all. Credit reporting bureaus can also mix files with people who have similar Social Security numbers or names.
When you’re dealing with something negative on your credit report, you probably just want it to go away as quickly as possible. That can leave people wondering whether or not pay-for-delete options are best. The answer is no, you shouldn’t try to pay for the deletion of negative information until, at a minimum, you talk to a consumer protection attorney.
Pay-for-delete letters are considered a tool to negotiate to get negative information off your credit report. If you owe a balance, you might ask a creditor to delete negative information in exchange for you paying some or all of the balance.
Even if you pay, there’s no guarantee the negative information will be removed. There are also countless situations where consumers say they worked out some type of payment plan with a creditor or debt collector, only for that company to say they have no record of this.
When you work with a consumer protection attorney first, they can help you guide the process in the direction that’s best given your specific situation because it’s not the same for everyone.
Because of the Fair Credit Reporting Act, you have the right to submit a dispute to Debt Recovery Solutions about some or all of a debt or information they’re reporting to one or more credit bureaus. Then, within 30 days, the company has to investigate and update any wrong information. A consumer protection attorney can submit a dispute on your behalf, showing the company you’re serious and ensuring you don’t have to communicate with them in the meantime.
There’s also the Fair Debt Collection Practices Act or the FDCPA, which prevents debt collection agencies from relying on harassment, threats, or deception. Debt collectors have to stop contacting you if you ask them to, and they can’t call you before 8 a.m. or after 9 a.m. They also can’t discuss your debt with third parties, like your employer or family members.
If you’re tired of dealing with calls from Debt Recovery Solutions or seeing them on your credit report, Fair Credit can help. Reach out to our FCRA consumer protection attorneys for a free case review.