Collection agency sued for not upholding verbal agreement with consumer

By Michelle Massey, East Texas Bureau | Feb 23, 2011

SHERMAN - A debt collection agency is being sued after it refused to uphold a verbal agreement reducing a consumer's debt by approximately $6,000.

Claiming violations of the Fair Debt Collection Practices Act, Angela Austin filed suit against LTD Financial Services on Feb. 16 in the Eastern District of Texas, Sherman Division.

Austin states the initial negotiations regarding the debt began in Aug. 2010. She states that they agreed to resolve the debt for a total payment of $1,000. She agreed to monthly payments until she could pay the balance in full.

Near the end of 2010, she states she tried to exercise the agreement by offering to pay the debt but she was told it would now cost her more than $1,100 to resolve it. Austin states the defendant further advised that the agreement "was just a verbal agreement and not in writing."

According to the complaint, she was also told that if she did not pay the new funds demanded then "the deal was off" and Austin would owe more than $7,000.

The defendant is accused of violating the Fair Debt Collection Practices Act and for using unreasonable collection efforts.

Austin is asking the court for an award of actual damages, exemplary damages, interest, attorneys' fees and court costs.

The plaintiff is represented by Jeffrey L. Weinstein and Bonner C. Walsh of Weinstein Law in Athens.

A jury trial is requested.

U.S. District Judge Richard A. Schell is assigned to the case.

Case No. 4:11-cv-00075

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