Midland Credit Management, Inc., is a third-party debt collector with headquarters in San Diego. If you’re getting letters or phone calls from this company, and you want the calls and letters to stop, you’ve come to the right place. This article will tell you exactly how to deal with this debt collection company and explain how to get an MCM collection removed from your credit report. Communicating with debt collectors can create a stressful situation, so it helps if you know how to communicate with them effectively.
How to remove MCM from your credit report
Follow these three steps when dealing with MCM:
Step 1: Demand written communication only
Dealing with MCM over the phone isn’t advisable. While many debt collectors do follow ethical business practices, some make promises over the phone and then have no record of them. When this happens, the consumer has no proof of the agreement. It’s much safer to restrict communication to letters sent and received via U.S. Mail. You can register your mail if you want an even more reliable method.
With this in mind, your first step is to send a letter to MCM demanding them to communicate with you in writing only. As a consumer, you have the right to make this demand. The Fair Credit Reporting Act (FCRA) promotes fairness and accuracy of information in the files of consumer reporting agencies. Under the rules set out in the FCRA, you have rights, one of which is to demand written communication.
Try to send this letter within 30 days of hearing from MCM for the first time. It’s important to take action quickly, as your chances of getting a negative entry removed from your credit report will decrease after the first 30 days.
To get started, access a free copy of your credit report on AnnualCreditReport.com.
Step 2: Request validation of the debt
MCM collects on debt bought in bulk from original creditors, such as credit card companies and personal lenders. Midland Funding buys this debt for pennies on the dollar, and then MCM starts collecting on this debt, breaking even and usually making a profit by collecting outstanding debt from consumers. MCM only makes money if it collects the debt, so its representatives can be tenacious.
To get MCM removed from your credit report, you should write another letter — called a debt validation letter — within 30 days of your first communication with this debt collector. The letter should demand validation of your debt. The company must prove the debt in question is in fact yours. When the company responds, look over the data it sends you. Are there any inaccuracies? If there are, the company must stop contacting you and remove the negative entry.
The terms of the FCRA mandate that MCM investigate the claim against you. If you can prove that the claim is not valid, they must remove it from your credit report. It’s possible that MCM reps will prove the validity of the debt. If they do, you’ll need to try something else.
Step 3: Make a deal with Midland Funding
It’s usually possible to haggle with debt collectors and pay less than what you owe in exchange for having the credit entry removed from your credit report. This type of negotiation happens often. Collection services companies pay less than the going rate for the debt they buy, so they can afford to take less than the total of the debt and still make a profit. Anything you pay above their low purchase price is profit from their point of view.
With this in mind, if MCM does validate your debt, you should make every effort to negotiate. If you don’t, the negative impact of the debt on your FICO credit score can become an ongoing burden. This may affect your ability to get credit in the future, such as a car loan, new credit card or mortgage. And, of course, you'll keep getting phone calls and letters from MCM's account managers about this past-due debt.
Step 4: Negotiate a pay-for-delete
Your next step is to write a third letter and propose a deal. Offer to pay a set percentage of the total debt, such as 30 to 50% in exchange for removing MCM from your credit report. Remember, never do this type of negotiation over the phone.
If the company agrees to your terms, write it a check, send it and avoid giving the company access to your bank account. Wait 30 days, and then write a final letter asking the company to verify that it removed the negative entry from your credit report.
If you set up a payment plan, get the terms in writing, and make sure you follow them. A written agreement is important, as MCM could cash your checks and not acknowledge your deal. It would still appear on your credit report, and the original creditor may also appear.
Step 5: Have a professional remove your debt
The four steps above are simple enough, but you may prefer to have a professional credit repair company handle your credit problem. Consider contacting Credit Saint. It’ll take care of you and can usually get data removed a lot quicker.
Midland Funding or MCM?
You may see two different company names appear. Midland Funding, LLC is a debt buyer. It buys old debt from original creditors, usually for pennies on the dollar. If Midland Funding buys your old debt, it'll turn the account over to MCM to collect the debt from you. Midland Funding could appear on your credit report when you’re actually dealing with MCM. If you choose to contact the credit bureaus directly about your debt, make sure you specify which company it concerns.
What will MCM do if you don't pay an old debt?
Like any collection agency, MCM's debt collection practices rely on persistence and a certain degree of implied fear. It won't break the law, but many account holders still consider the agency's practices as harassing behavior. The Better Business Bureau (BBB) receives numerous complaints each year about MCM's debt collection practices.
The Fair Debt Collections Practices Act (FDCPA) prohibits MCM and other debt collectors from calling you at odd times, such as late at night or early in the morning, especially after you request them in writing not to. The FDCPA also gives you the power to control which phone number MCM calls. Make sure you request a change of phone number or other contact information in writing. Contact the BBB or your state’s regulators if MCM fails to follow FDCPA stipulations.
Will MCM take legal action against you?
If you don’t pay the debt, MCM could take legal action against you to collect it. If this happens, check the statute of limitations in your state relating to the kind of debt you owe. If the statute expires, you can get the case dismissed without seeking legal advice. These statutes vary from state to state. For example, New York State has a six-year statute on all consumer debt; California's statute is four years on most types of debt.
To clarify, statutes of limitations on debt refer only to a debt collector's ability to take legal action against you. You would still owe the debt even after the statute expires, but they couldn't hold you liable in a court of law. If your first contact with MCM is recent, your debt is probably within the statute of limitations.
Should you pay MCM or wait?
If MCM can validate your debt, and if you can negotiate an amount you can afford in exchange for removing Midland Funding or MCM from your credit report, you can benefit from the three-step approach above and get the debt off your report quite quickly. However, you must get an agreement in writing from MCM before paying anything. The benefit of this approach is getting the damaging mark off your credit report so you can get better interest rates on loans and regain control of your finances within a couple months.
But there's another strategy to consider: waiting until the debt no longer appears on your credit report, which would take at least seven years. If you can’t afford a negotiated settlement and you have no other way to settle the debt, you may decide to wait it out. If you do this, you should stop communicating with MCM immediately. Any communication could reset the statute of limitations to day one, and it could extend the time Midland Funding/MCM stays on your credit report.
Does MCM offer COVID-19 hardship relief?
Student loan servicers, most mortgage lenders and some credit card issuing banks have COVID-19 financial hardship relief programs. They may allow you to skip payments or enter an extended period of forbearance during the pandemic's economic aftermath. MCM has added a note on its home page expressing a willingness to work with account holders to keep accounts current.
As with anything related to debt collections, make sure you get any new agreements you make in writing, especially if you have an agreement with MCM for the removal of a debt from your credit report.
You can contact MCM using the following details:
- Call MCM toll free: 877-420-0039
- Or write to MCM at: Attention: Chief Compliance Officer, P.O. Box 939069, San Diego, CA 92193
Update: This article was updated to reflect MCM’s current contact information and BBB complaint volume.
Disclaimer: This story was originally published on October 13, 2017, on BetterCreditBlog.org. To find the most relevant information concerning collections or credit card inquiries, please visit: https://money.com/how-to-remove-collections-from-credit-report/ or https://money.com/get-items-removed-from-credit-report/