Specialized Loan Servicing Sued Over Allegedly False Threats in Collection Notice

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Specialized Loan Servicing, LLC is on the receiving end of a proposed class action filed in New York over claims that the company misrepresented the character and legal status of a consumer’s debt.

The plaintiff alleges he received a collection letter from the defendant in July 2018 that stated, in part:

“As required by law, we may provide information to credit bureaus about an insolvency, delinquency, late payment or default on your account and this may be included on your credit report.”

The case claims this statement was false as the statute of limitations to report the debt to credit bureaus was expired when the letter was received. Notably, the suit says the company sent monthly letters containing identical false threats for at least one year before the July 2018 notice.

The plaintiff claims he suffered “confusion, surprise, fright, worry, distress, agitation and irritation” due to the letter’s deceptive representations.