Allied Collection Services Calling? How to Respond and Settle

Allied Collection Services just showed up on your credit report or started calling daily. You're not sure if the debt is even yours, and the amount seems wrong. Welcome to third-party debt collection.

Allied Collection Services operates out of Las Vegas and California. They don't originate loans or issue credit cards. They buy old, unpaid debts from banks and credit card companies, usually for pennies on the dollar. Then they try to collect the full amount from you.

The good news: You have leverage. The bad news: You need to act fast and smart. Here's what to do.

Who Is Allied Collection Services?

Allied Collection Services is a debt buyer. When you fall behind on a credit card or medical bill, your original creditor often gives up after 180 days. They sell your debt to a company like Allied for 5 to 15 cents on the dollar. Allied then owns the debt and tries to collect 100% from you.

Allied Collection Services is not accredited by the Better Business Bureau. The BBB website lists dozens of consumer complaints. The Consumer Financial Protection Bureau shows additional complaints, many claiming Allied contacted consumers about debts they didn't owe or that were past the statute of limitations.

That doesn't make Allied a scam. It makes them a debt collector with a spotty track record. Your job is to protect yourself.

Why Allied Collection Services Is Contacting You

Three common scenarios:

• You fell behind on a real debt. Credit card, personal loan, utility bill. The original creditor sold it to Allied after you stopped paying.
• The debt is yours, but the amount is inflated. Allied added fees or interest that may not be legally enforceable in your state.
• The debt isn't yours at all. Wrong person, identity theft, or a debt that was already paid or discharged in bankruptcy.

Until you verify the debt, you owe them nothing. Not a dollar, not a promise to call back, not an acknowledgment that the debt is valid.

Step One: Stop Talking to Allied Collection Services

If Allied calls, do not confirm your identity. Do not discuss the debt. Say this:

"Send me written verification of this debt. Do not call me again until you do."

Then hang up. Under the Fair Debt Collection Practices Act (FDCPA), Allied must send you a validation notice within five days of first contacting you. That notice must include:

• The amount you allegedly owe
• The name of the original creditor
• A statement that you can dispute the debt in writing within 30 days

If you dispute the debt in writing within 30 days, Allied must stop collection efforts until they provide proof you owe it. Use that time wisely.

Step Two: Request Debt Validation

Send Allied Collection Services a debt validation letter by certified mail. Demand that they prove:

• You are the person who owes the debt
• The original creditor and account number
• The date the debt became delinquent
• A complete payment history
• Proof that Allied owns the debt

Many debt buyers can't produce this documentation. They bought your debt in a bulk portfolio with minimal paperwork. If they can't validate, they must stop collecting and remove the debt from your credit report.

What If Allied Validates the Debt?

If Allied sends proof that the debt is yours, you have three options:

Option 1: Settle for Less

Allied bought your debt for a fraction of what you owe. They'll often accept 30 to 50% of the balance to close the account. Start by offering 25% of the total. Negotiate up if needed, but never agree to more than 60%.

Get the settlement in writing before you pay. The agreement should state that payment in full satisfies the debt and that Allied will report the account as "paid in full" or "settled" to the credit bureaus.

If you need help negotiating, our debt relief screener can connect you with settlement services or other options based on your financial situation.

Option 2: Pay in Full

If you can afford it and want the debt gone, pay the full amount. Insist that Allied report the account as "paid in full," not "settled for less." A paid-in-full notation looks better on your credit report.

Option 3: Let the Statute of Limitations Run

Every state has a statute of limitations on debt collection lawsuits. In Nevada, it's six years for written contracts. In California, it's four years. If your debt is older than that, Allied can't sue you.

They can still call and send letters, but you can tell them the debt is time-barred and they should stop contacting you. Check your state's statute of limitations before choosing this route.

What If Allied Collection Services Sues You?

If Allied files a lawsuit, you must respond. Ignoring a lawsuit guarantees you lose. Allied gets a default judgment, and then they can garnish your wages or freeze your bank account.

File an Answer within the deadline stated in your summons, usually 20 to 30 days. In your Answer, deny that you owe the debt and demand that Allied prove their case. Many debt buyers can't prove they own the debt or that the amount is correct. If they can't prove it, they can't win.

If you're already facing a lawsuit, bankruptcy might be worth considering. Filing Chapter 7 or Chapter 13 immediately stops the lawsuit and can discharge the debt entirely. But act fast. Once Allied gets a judgment, your options shrink.

How to Report Allied Collection Services for FDCPA Violations

Allied Collection Services must follow federal law. If they cross the line, you can sue them for damages up to $1,000 plus attorney fees. Common violations include:

• Calling before 8 a.m. Or after 9 p.m.
• Calling you repeatedly in a single day
• Threatening arrest or wage garnishment without a court judgment
• Discussing your debt with family, friends, or coworkers
• Using abusive or profane language
• Refusing to verify the debt after you request it
• Continuing to call after you send a cease-and-desist letter

Document every violation. Note the date, time, what was said, and who you spoke to. Then file a complaint with the Consumer Financial Protection Bureau at consumerfinance.gov/complaint or call 855-411-2372. You can also report violations to the Federal Trade Commission at reportfraud.ftc.gov or 877-382-4357.

If Allied violated the FDCPA, consider consulting a consumer rights attorney. Many work on contingency, meaning you pay nothing unless you win.

How Allied Collection Services Affects Your Credit

A collection account from Allied tanks your credit score, often by 50 to 100 points. The damage is worst in the first two years, then gradually fades. After seven years, the collection account must be removed from your credit report under federal law.

Paying or settling the debt does not remove it from your report. It only changes the status to "paid" or "settled." The collection remains visible for seven years from the date the original account first became delinquent.

If you dispute the debt and Allied can't validate it, they must delete the collection from your credit report. That's the fastest way to repair your credit.

Contact Information for Allied Collection Services

Allied Collection Services' phone number is 877-714-8191. Do not call them unless you're ready to negotiate a settlement or have already sent a debt validation letter. If you call unprepared, you're giving them ammunition.

Send all written correspondence to Allied by certified mail with return receipt requested. Keep copies of everything. You'll need documentation if you later dispute the debt or report violations.

The Bottom Line

Allied Collection Services bought your debt for pennies. They'll take less than you owe. Start by demanding validation, then negotiate a settlement once you confirm the debt is real. If they can't prove it, they can't collect it. And if they sue, respond immediately or consider bankruptcy to wipe the slate clean.