I attended UNCW (University of North Carolina Wilmington) for approximately 3 weeks back in August/early September of 2005. Apparently, I had to pay tuition for that semester as I missed the cutoff date to receive tuition refunds. A check was written to the school for $3100 approx. in June of 2006. I have no idea why, as this is now several years later, we (my mom and I) were paying in June of 2006 when I had attended in August of 2005. Either way, that was that. We paid. We were good to go.
Fast forward to Spring of 2011. I get a call from the student collections lady at the university. She says the check my mom had written for tuition had been returned and “bounced.” I asked why they hadn’t told me before now? It had been 5 years since the check was written. She stated that they tried to contact me at so and so address. The address she gave me was my father’s town home, one that I had moved out of around the time I attended the school, and he had rented out around the same time. She said they had sent my account to the attorney general and that they were unable to find me too. I, unfortunately like many other twenty-somethings I’ve found, was not raised to know much about personal financing and was quite scared from this phone call. My mom talked to the university lady (I’ll call her Beth) and agreed to pay what she could each month, but she explained that she is now almost completely broke. So my mom worked out something no the telephone with Beth and that was that. (We never verified the debt, I didn’t know this was standard procedure. My mom is generally irresponsible with finances and her life… I shouldn’t have trusted her to make payments.)
Fast forward to this Spring (2012). I get a call from Beth. My mom has only made 3 payments this past year. If I don’t pay in full by May 1 my account will be sent to collections. To hold her off, I make a $50 payment. I explain that I will try to enlist my parents help, but that most likely they won’t be able to help me. That I will, if I can, pay in full in August… but that I may not have the funds to. (I probably won’t, at the time I thought I’d be receiving grant money, but now I am not.)
I need to call Beth back and make another payment. But in these last couple of weeks, I’ve just been so confused about how this all worked out this way. How was I not “found” to be notified of the debt? The address listed on the check (the check had my mom’s name and my name and her home address – it was a college account for me that my mom was in charge of) was and still is my mom’s address. I could have easily been found there. I’ve always had my address and home phone numbers listed publicly. Always.
Even when Beth called us last year, I had not gotten anything written formally and mailed to me to explain the situation. Just this phone call. I have verified that she is indeed truly associated with the school. It’s all on their website. What is also on their website is the collection process, clearly laid out in steps. This is what the website says:
“Debts $50.00 and over are referred to the North Carolina Department of Revenue for garnishment of taxes and to a collection agency.
You may still pay this debt to the University and/or the Cashiers Office.
If you pay by phone with VISA or MasterCard your hold is removed immediately. Balances that are paid by web check will have their holds removed after 10 days; payments by paper check will have their holds removed after 30 days.
1. Students are notified by letter that they have an outstanding balance with the University. The first letter is sent when you are 30 days past due, and the second letter is sent when you are 60 days past due. Any student with an outstanding debt will not be able to register for classes or receive a transcript or diploma until the debt is paid in full. THERE ARE NO EXCEPTIONS TO RELEASING HOLDS WITH STUDENTS WHO HAVE AN OUTSTANDING BALANCE WITH THE UNIVERSITY.
2. If the outstanding balance is not cleared within 60 days, the student may be referred to the NC Attorney General’s office and NC income tax refunds can be forwarded to the University.
3. Outstanding balances NOT paid after 90 days will be forwarded to a North Carolina state approved collection agency as well as reported to the credit bureau.
To release your hold prior to the 10 days or 30 days, you may fax a copy of the front and back of your check, or notification from your bank showing that the check has cleared your account.
Accounts deemed uncollectible after a period of attempt to collect are written off the university’s accounts receivable balance. The unpaid balance plus collection costs (interest) remains a legal obligation of the student. The accounts are retained with a third party collection agency and reported to the credit bureau.Accounts are also reported to the NC Department of Revenue for garnishment of tax money. A transcript, diploma, and registration hold will remain on the student account until the account balance is paid in full.”
I keep asking myself, “Why was my account not sent to collections? Surely a collection agency would have ‘found me.”
I asked my mom to call her bank and verify the debt on our end. Lo and behold, my mom wrote the check on an old check book. The account had been switched to a new investment company in January of 06, making the checks she used invalid. (Why my mom was writing a check on an invalid account 5 months after the account had been switched is beyond me… it’s upsetting how she just… doesn’t notice these things.) So it seems the debt is indeed legit.
However, the university seems to have lost me in the shuffle or something… somehow my account was not sent to collections, as it should have been, according to their website and their “collection process.” Of course I don’t WANT it sent to collections! But I’m just beside myself that they supposedly couldn’t find me and that the procedures weren’t followed.
I have checked my credit report and this debt is not on there.
So here are my questions:
1. Many people have suggested I request, in writing (via certified mail), that the university validate the debt on their end. Is this even necessary now? I’ve read online that requests for validations should happen within 30 days after being notified of the debt. I was never notified in writing, just a phone call, and that was nearly a year ago. I’ve also basically validated the debt on my end. Do I still ask for validation? Do I call Beth to let her know that I’m communicating in writing from now on? Do I not make any more payments until this is done? Do I have to use certified mail?
2. Because I do believe I owe the debt. Is there any negotiating room? Many people have suggested that I ask for proof of their attempts to contact me. Do I ask for proof of the attorney general trying to reach me? Do I have her verify which addresses/phone numbers she has tried to reach me at?
3. I can not pay this balance in full in August, as I had originally stated to Beth. How do I work with her now? Do I only communicate in writing? email? Phone calls are much easier, but obviously not leaving much proof of anything. The last time I made a payment I did it over the phone, $50, gave her my debit card number… I’ve of course checked my bank statements, they’ve only charged me for that one $50 payment.
4. Should I try to pay what I can now and then set up a payment arrangement, if she’ll allow me, where I make monthly payments? What if she says no and wants to send it to collections? Is there anything I can do to prevent this from happening? My credit sucks anyways… some people are telling me to just let her send it to collections… I feel this is irresponsible
5. Do I have anything going for me here that can help me settle this debt in a fair manner? I’m nervous to contact Beth because I keep being told only to contact in writing… but shouldn’t I at least contact her by phone to let her know I’m only going to contact in writing? Is this contact in writing thing stupid?
I’m so confused. I worry about it everyday. I’m reaching out to anyone and everyone for advice.
I have a son, he’s six. I’m a single mom. I am going to be a teacher. I do not want to make more mistakes financially than I already have. I’m sorry I’m basically stupid when it comes to finances. I just want to handle this in the best way and not screw myself over by making some large payment and then not having money to live off of. I am still in college. I have one more year until I graduate. I am confident I will get a teaching job soon after I graduate for I am highly qualified and becoming a great teacher. I just am lost in this situation. I realize that many people have much larger financial problems, but for me, someone with little to no income (I do odd jobs), this is weighing on me heavily.
Thank you for taking the time to read all of this.
Scoot (my nickname)”
Thank you so much for providing so much detail.
Overall I think you have a good handle on the matter. But I do have a few questions I’d like for you to answer for me.
I am assuming that at the time you attended or signed up for classes and did not pay via a student loan or prepay for the class. I know that looks obvious but I just want to make certain. You signed up for school and owed the school for the tuition with some understanding on how that tuition was to be paid. Is all of that correct?
If that above is correct then it would appear you would be personally liable for the debt. But since the statute of limitations would appear to be three to five years on this if you are still living in North Carolina then it might make better sense for you to meet with a local consumer attorney and discuss if this debt is even still legally collectible. What state are you living in?
I’m not stating with certainty that it is not collectible, but there is some doubt that it might be.
The process the collector appears to have informed you about for collection is the Setoff Debt Collection Act, Chapter 105A of the General Statutes. – Source
But under that statute there appears to be an appeal process. We just are not up to that point just yet.
Please post your responses and follow-up messages to me on this in the comments section below.