What Is NCO Financial and Why Is It on My Credit Report?

FT Contributor

NCO Financial, also known as “NCO Financial Systems” or “NCO Group,” is one of the country’s largest third-party debt collection agencies. The Better Business Bureau (BBB) reports NCO Financial has been around since 1996.

In 2012, NCO Financial merged with APAC Customer Services, forming Expert Global Solutions (EGS).

NCO Financial collects for a broad range of industries, including:

  • Communications;
  • Healthcare;
  • Media and entertainment;
  • Financial services;
  • Retail and consumer goods;
  • Transportation and logistics;
  • Technology;
  • Travel and hospitality;
  • Energy and utilities;
  • Public-sector industries.

Table of Contents

Is NCO Financial a Legitimate Collection Agency?

NCO Financial is a legitimate collection agency. The BBB has 17 different profile pages for them, with addresses in Pennsylvania, Delaware, New York, and New Jersey.

Complaints Against NCO Financial

Although NCO Financial is a recognized third-party collection agency, there have been complaints about unscrupulous practices filed against them over the years.

The Federal Trade Commission (FTC) has taken numerous enforcement actions against NCO Financial’s parent company, Expert Global Solutions, for allegedly illegally harassing consumers without proof of the validity or amount of the debts. A 2013 action was the largest ever civil penalty against a debt collection agency.

The FTC has accused NCO Financial of violating the Fair Debt Collection Practices Act (FDCPA) and the FTC Act by utilizing illegal practices, including calling:

  • Multiple times per day;
  • After being asked to stop;
  • Before 8 a.m. or after 9 p.m.

The agency uses dozens of phone numbers and has a history of harassing consumers over the phone. Attorneys general from 19 states have charged NCO Financial with:

  • Attempting to collect debts after the statute of limitations had expired.
  • Making excessive numbers of phone calls.
  • Failing to validate disputed debts.
  • Disclosing sensitive personal information to third parties.

What Should You Do if You See NCO Financial on Your Credit Reports?

NCO collections — or any debt collection agency that shows up on your credit report — can negatively affect your credit score and restoring it can be a difficult and daunting undertaking. Unfortunately, regardless of whether you pay, it could remain with you for up to seven years.

Although it is stressful to see a collection agency on your credit report — or receive a call from a “so-called” debt collector — the worst thing to do is avoid them. There are options for dealing with debt collectors.

Verify the Debt Is Legitimate

Once debt moves from the original creditor into the hands of a debt collector, you might not recognize the company that contacts you. If NCO Financial appears on your credit report, the first thing you’ll want to do is verify that the debt, in fact, belongs to you.

Request the company’s physical street address and telephone number. Never give a caller personal or financial information until you have confirmed they are legitimate. Know that, if they are legit, they will already have many of your personal details from the original lender.

Some additional ways to determine whether a debt collector is legitimate include:

  • They sent a written letter through the mail.
  • The agency holds a license in your state.
  • They can tell you where the debt originated.
  • They give you multiple payment options (e.g., check, credit card, or debit card).

As a consumer, you have rights under the Fair Debt Collection Practices Act; don’t allow NCO Financial (or any collection agency) to violate them.

Consult With a Credit Counselor

If you’re starting to feel the situation is out of control, you may need some help getting things back in order. A certified credit counselor or professional credit repair company can assess your financial situation and work with you to establish a plan.

Credit counseling companies are typically nonprofit. They advise you on managing your debts and usually offer free educational materials and workshops. However, they may charge a fee for their services that they take out of the payments you make.

Credit counselors can help you lower your overall monthly payment by getting the debt collection agency to increase the period over which you can repay a debt. They may also convince creditors to lower the interest rates.

How to Remove NCO Financial From Your Credit Reports

You have a few options for erasing NCO Financial off your credit report. The most effective way is to dispute it with the credit bureaus. The law authorizes you to dispute any “questionable” entry on your credit report. If you’re uncertain of the accuracy or are totally unfamiliar with an account, you can dispute it with the credit bureaus.

The following are some tactics you can use to try and remove NCO Financial from your credit report:

  • Ensure every transaction occurs in writing via snail mail. Establishing a paper trail makes it harder for collection agencies to go back on their word.
  • Send a debt validation letter requesting that NCO Financial prove that the debt in question is your debt.
  • If the debt is, in fact, yours, you can send a dispute letter to the three major credit bureaus —  Experian, TransUnion, and Equifax. Dispute any incorrect data related to your credit entry and your issues with NCO Financial.

Can NCO Financial Sue You?

If you don’t pay a debt that is in fact yours, debt collectors can sue you. However, it is unlikely NCO Financial would bring legal action against you for a debt you don’t owe, or they cannot validate.

Although the amount of time a creditor can take before asking the court to mandate payment (statute of limitations) varies by state, depending on the type of debt, typically, it is between three and six years.

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