What Is “Parking the Debt?”

Anyone who has ever watched television or dealt in-person with debt collectors in Cincinnati knows how sneaky they can be. Generally, there are certain rules set out by the Fair Debt Collection Practices Act that creditors must follow when calling about a debt. These dictate what they can and cannot say. But what if you never knew about the debt in the first place?

According to federal law, there are creditors, such as hospitals, who are not required to send a bill before sending collectors after you. All the sudden, you may be dealing with wage garnishment and other punishments for money you did not know you owed. This is called “parking the debt.”

Due to the nature of this practice, you may not know about the debt until it has already wreaked havoc on your credit score. What’s more, it’s completely legal. Creditors only have to let you know if they are going to report negative behavior to credit reporting agencies. Since the debt is doing that anyway, there is no need for them to send that information.

There’s a catch, however. If the creditor never sent a bill, then you are not late or delinquent on it, as long as you pay it as soon as you get it. But if they do send it to, say, an old address, that could constitute as notifying you about the debt.

If you are dealing with sudden debt collection in Ohio that you cannot manage, it is important to contact an attorney. They may be able to fight the creditors on your behalf and stop any harassment.