If you’re receiving calls from Portfolio Recovery Associates (PRA), it can be unsettling, but it’s important to understand why they might be reaching out. Portfolio Recovery Associates is a major debt buyer, and their calls usually indicate they believe you owe a debt. Here’s a breakdown of what’s likely happening.
Debt collection agencies like Portfolio Recovery Associates operate by purchasing debts from original creditors. This process typically unfolds as follows: when companies like credit card issuers, banks, or other lenders struggle to recover money owed by borrowers, they often sell these unpaid debts to third-party companies for significantly less than the original amount. Portfolio Recovery Associates is one of the largest firms engaging in this practice. They acquire these debts and then attempt to collect the full amount from the individuals who originally owed the money, aiming to make a profit from the difference.
Therefore, if Portfolio Recovery Associates is contacting you, it’s highly probable that they have bought an old debt that they believe is yours. Their collection process typically begins with phone calls and letters. These communications are designed to inform you about the debt and persuade you to make payments. They might provide details about the original debt, the amount they are seeking, and instructions on how to pay.
However, the fact that Portfolio Recovery Associates is calling doesn’t automatically confirm that you are legally obligated to pay the debt. There are several reasons why you might not actually owe the debt they are trying to collect. For example, the debt could be very old and may be past the statute of limitations, which is the legal time limit for debt collectors to sue you to recover a debt. In such cases, while they can still contact you, they cannot legally force you to pay through a lawsuit. It’s also possible that the calls are a case of mistaken identity, and the debt doesn’t belong to you at all. Furthermore, the debt might have already been settled, perhaps through prior payments or if it was discharged during a bankruptcy proceeding.
Given these complexities, if you’re uncertain about why Portfolio Recovery is calling or if you believe you do not owe the debt, it’s wise to seek advice from a legal professional. Organizations like Legal Rights Advocates can offer assistance by helping you understand your rights and the best way to handle the situation. Additionally, it’s beneficial to familiarize yourself with the Fair Debt Collection Practices Act (FDCPA). This federal law protects consumers from abusive, deceptive, and unfair practices by debt collectors. Knowing your rights under the FDCPA can empower you to deal with debt collectors more effectively and ensure you are treated fairly throughout the debt collection process.
