A medical bill was sent to collections. What do I do?

I was in a situation similar to yours about four years ago, and just ignored it because I could not afford to pay at the time. The bad mark on my credit report dragged my score down by about 80-100 points, and this year I finally needed to fix my credit to buy a house. I followed this http://whychat.5u.com/hipltr.html exactly as written and managed to get the derogatory mark deleted off my report for all three credit reporting agencies. This method required that I pay my bill in full to the original hospital, and then write literally about 20 letters freehand, but it did work, and my credit score/report is now spotless. I don't know if the laws will change, but right now this totally works if you follow it exactly and it allows one to fix their credit if the only derogatory marks are medical accounts.

Don't panic. What you have there is a demand letter, and it's written in a frightening way on purpose. You can always negotiate with debt collectors. You can find tips on how to make them validate the debt in the first place. Even though you're pretty sure where the debt comes from, you can give them a chance to screw up by not having the paperwork to show the origin of the debt. The first thing you do is find out if your grandmother guaranteed payment to the hospital or if you did. It's possible you don't owe the hospital at all, but that she did. You can also almost always find a *small* amount you can pay per month. They won't accept it right away, so be ready with a very small offer and a slightly higher offer. The idea that your mother has credit accounts in your name is a red flag to me... at least she pays them. Once you get the hospital bills sorted out, getting those accounts closed or under your sole control is very important.

"the credit cards were so that she could pass on her credit and I could have a good credit foundation" It doesn't work that way. If the cards are in your name and she opened the accounts using your name and SSN, it's fraud. If she gets hit by a bus tomorrow, you will be the person who has to pay those bills. Call the collections agency, do NOT give them any bank account information either over the phone or online. Do not write them a letter. You can offer to pay the bill over time, you can offer to settle for a reasonable amount or you can blow it off, which will cause your credit score to drop. Avoiding unpleasant things is something everyone does, but it's not a good plan as you become an adult. Someday you may want to work for some company that does credit checks, and you'll be screwed.

I worry about the idea of putting this on a credit card in your name, because you suggest that your tendency is to stick your head in the ground about this stuff because you're frightened of it, and when it's a medical bill held by people who want to work with you to get the issue resolved, that's one thing, but when it's a credit card company charging you 18% interest for each month you ignore it and who doesn't care about whether you go bankrupt or not, that will be quite different. What about borrowing a small amount from your mother to start paying on the bill, instead of putting yourself in debt to a credit card company?

(update: I just checked my credit report and it says my score is in the good range. Apparently my mother had opened credit cards in my name and didn't tell me, and there are about 100 on-time payments for those. This has not showed up yet but I don't know when or if it will.)

Call them up, explain the situation, offer to pay $5. a month. Or apply for Medicaid which, in some cases, can pay old bills. Why aren't you covered on your mom's insurance? You're under 26, and, presumably, in the US. Why does your mother have credit cards in your name, and what is she buying with them? You need to find out! Of course, she may have just added you to hers. Stop panicking, it's not a big deal. Just call the various places and sort it out.

I'd cancel the credit cards your mom opened in your name, put a fraud alert on your credit report. Call each agency and make payment arrangements. For the remainder of your bill. Sign up for insurance, you may be eligible for subsidized rates.

(uh, just to clarify, the credit cards were so that she could pass on her credit and I could have a good credit foundation, not fraud on her part. this has been going on for a year with everything on time and I really have no reason to distrust her. of course all of this might be moot with this bill but who even knows. also, past questions say never talk to collections agencies on the phone as they will screw you over, talk to the source, is this true?)

I got a delinquent medical bill once when I had moved to a new place, updated my address with my doctor, but the lab they outsourced their testing to was apparently never informed and my bill never got forwarded. Do not settle with the collections people. Ask them who the original creditor was, get contact info and call them to arrange payment. When you speak to collections, get the name of the person you spoke with and write it down. Tell them you will settle with the original creditor. The lab people were super understanding because this happens a lot.