Conditional Acceptance

You may have heard of conditional acceptances. Maybe you have no clue what it is. I first heard about it through watching videos a few years ago by Christpher Houser on You Tube. Chris has since shut his account down, but someone stole all of his videos and reposted them as him. I suppose they did this to try to scam money from unsuspecting people new to this information I am sharing on this website. Chris always said that if you are asked for money in his name, it is not him. He said even if it is someone that looks like him, don’t send money. But I digress…

When I first heard of the conditional acceptance, it was super hard to comprehend. Chris gave very valid information, but his teaching style made it hard to put it together. Finally, after much research, I finally pulled it together.

A conditional acceptance is exactly that, accepting something and attaching a condition to it. As a simple way to describe it, consider this: I claim that you owe me money, let’s say $20,000. You conditionally accept my claim by saying, “I accept your claim that I owe you $20,000 if you can prove it.” This is the condition. This is basically it in its simplest form. But to add to this, a fee schedule can be attached to the acceptance. It would be something like this where you would respond: “If you can’t prove that I owe you said money, you will owe me $100,000 per my fee schedule for the failure to prove that I owe you $20,000. The thing is, if I wouldn’t be able to prove you owe me $20,000, then by acceptance of your counterclaim, I would owe you $100,000. You could file and record an affidavit of truth that I owe you $100,000. If I do not rebut your affidavit point-by-point, then it stands as truth as judgement in commerce. At this point, you could sue me. You would win easily. This method is a nightmare for debt collectors. They hate it. Let me set this scenario up and then I’ll return to the conditional acceptance description.

Debt Collectors

When a debt collector sends a claim that you owe them money, they are lying. What they do is they buy a bulk amount of debts from different companies, doctors, hospitals, etc. at a discount. This is called discount paper. For example, if you defaulted on a debt such as a hospital bill for whatever reason it will be written off by the hospital as charge-off. In simplest terms, a charge-off happens when a creditor decides that a debt is unlikely to be repaid, so they mark it as a loss in their accounting. They can either try to collect it or sell it at a discount. If they sell it, and they usually do, they may sell it at 40%-60% off of the total debt.

Example: They buy the debt of $1000 at a discount of 50% which means they bought the debt from the “creditor” for $500. Now they will come at you with their claim that you owe them $1000, and they will list the original creditor. They will tell you that you have 30 days to make arrangements to pay the debt and they may even offer you a deal of letting you pay $900 or lower amount if you pay before the 30 days is up. It sounds intimidating and it usually causes some people to make arrangements in payments of a small amount for months until it is paid off. The problem herein lies that if you make arrangements and start paying that claimed debt, you have entered into a contract with the debt collector and you will have to pay them. If you fail, they can sue you for breach of contract and you’ll really pay a fair bit of cash because of that. What happened when they bought your debt is that the debt becomes paid off by that purchase of the debt. They paid off your debt. They inserted themselves into the arrangement that you had with the “original creditor.” There was no agreement between you and the debt collector for them to insert themselves into your business. It is similar to a situation where two people are talking and someone steps up and inserts themselves into your conversation. In its simplest form, its rude! A debt collector can’t insert themselves into your business unless you consent. That is what they’re after, your consent. They’ll take it by direct consent (agreeing) or by tacit consent; that is by silence. If you do not answer their claim and you throw their claim in the trash, you have consented by silence. When you do not answer, you are in dishonor. So, in 30 days when you haven’t responded they report the non-payment to the credit reporting agencies. This is to try to cause you to pay. It is coercion and intimidation at its best.

If you argue with them and say that you don’t owe the debt, you are in dishonor. If you agree and accept their claim that you owe the debt, then you are in honor. Here is the sweet spot; If you conditionally accept the claim by the debt collector, then you are in honor.

Argue and deny – Dishonor
Ignore the claim – Dishonor
Accept the claim – Honor
Conditionally accept the claim – Honor

When you accept a claim of debt or conditionally accept such a claim, there is no controversy. When there is no controversy, courts cannot hear it. Courts only hear controversies (arguments). The debt collector cannot take it to court at this point. If you deny/argue or ignore the claim, then they could possibly sue, if the win is worth it to them. At this point your credit score will take a hit. (Who cares, right? It’s just a social construct. More on that later.)

When you conditionally accept a claim of debt or any kind of claim for that matter, the claimant has to fulfill your demands attached to that conditional acceptance, which is in itself, a counteroffer. Everything is offer and acceptance, and I mean everything. This is the basis of how contracts are created. I offer you something of value for something that you have of value. You agree and accept my offer, we have a contract, however verbal. When it is expressed (written) on paper and both of us sign it, we have memorialized that contract. An expressed, endorsed contract is hard to say that there was no contract created. When a debt collector makes an offer which sounds intimidating, you should accept that offer to stay in honor. Why not conditionally accept it?

When you write out your conditional acceptance as a counteroffer to the debt collector you will also provide a fee schedule with it. It may say that for the failure to provide proof that there exists a bilateral contract with both of your signatures, you charge $10,000 [put in whatever it is worth to you]; The failure to provide validation of the debt between you and the debt collector is another fee of $10,000; acquiescing (not responding) carries a fee of $50,000, etcetera. You can put in as many fees at whatever amount you think it is worth that is payable by the debt collector. Just so you know, they never respond. Now, when you send the conditional acceptance that you would allow a reasonable amount of time for them to respond, as minimum as 9-10 days, but 15 is fair. At the minimum, 3 days to get there, 3 days for them to prepare their response and 3 days for it to make it back to you. When you send the conditional acceptance you will send it either certified (administrative) with request for a signed return ticket, or registered mail with a signed return ticket (federal registration). The crazy thing is that the moment the postmaster takes the package from your hand to theirs (offer and acceptance) the contract is accepted because the postmaster is the agent for the recipient, i.e. the debt collector. How is this so? A little thing called the postal rule or the mailbox rule. This rule refers to the default rule in contracts law for determining when an offer was accepted. Under the mailbox rule, an offer is considered accepted the moment the offeree mails their letter, rather than when the offeror receives the letter in the mail. The mailbox rule also applies to other means of communication, such as a fax, telegram, or email, provided that it is irrevocable once sent. So, when the debt collector receives the contract and they sign for it, it has already been accepted and now by having it served to them i.e. in hand, it is received. Now they must respond, or they are in dishonor. Considering that they are dishonorable from the start by trying to intimidate and coerce you into their contract and wasting your time, it shouldn’t be a surprise that they are dishonorable. They are after all, liars.

If you would like to become a member of the PMA in which the conditional acceptance template and relevant documents are available, please visit the PMA (private membership association) page. It will be accessible soon.

UCC 1-308