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How To Deal With Penn Credit

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In a Nutshell

Penn Credit is a third-party debt agency that collects on past-due bills from hospitals, governments, toll road operators, and utility companies. If Penn Credit contacts you to collect a debt, validate the debt before you pay anything. If the debt isn’t yours or the amount is incorrect, dispute it. If the debt is yours but you are unable to pay it, consider negotiating a settlement.

Written by Jonathan Petts
Updated April 4, 2024

What Is Penn Credit?

Penn Credit is a third-party debt collection agency that specializes in managing accounts receivables, which means they collect past-due bills for different companies or creditors. This includes:

  • Traffic and court citations, taxes, and parking fines for municipal, local, and state governments

  • Unpaid medical bills for healthcare providers, such as hospitals and nursing facilities

  • Unpaid toll bills for toll road operators 

  • Unpaid electric and phone bills for utility and telecommunications companies

The company is called Penn Credit Corp and Penn Credit Corporation. Unlike some other debt collectors, Penn Credit doesn’t buy charged-off debts from original creditors.

Why Is Penn Credit Contacting Me?

If you have an unpaid toll or past-due medical bill, utility bill, or traffic citation, Penn Credit is likely contacting you to try to collect payment. Your original creditor probably outsourced its bill collection to Penn Credit. If you owe the debt, you could still consider contacting the original creditor to pay them directly.

Is Penn Credit Legit?

Yes, Penn Credit is a legitimate collection agency based in Harrisburg, Pennsylvania. They have an A+ rating with the Better Business Bureau (BBB), a nonprofit organization focused on improving marketplace trust. Although they have a high rating, 209 consumers have filed complaints with the BBB against Penn Credit in the last three years. And their customer review rating is 2 out of 5 stars.

The Consumer Financial Protection Bureau (CFPB) is an independent government agency that helps protect consumers from unfair, abusive, or deceptive business practices. Consumers have submitted 628 complaints against Penn Credit to the CFPB in the past three years.

Many complaints allege that Penn Credit tried to collect on a debt the person already paid or on an incorrect amount of debt. In some cases, people claimed that Penn Credit didn’t give enough information about the debt for it to be verified. Others reported that they received an excessive number of phone calls from Penn Credit.

Note to reader: These reviews and complaints highlight relevant issues, but they may not represent all consumers’ experiences.

If true, these complaints are violations of the Fair Debt Collection Practices Act (FDCPA). The FDCPA is a federal law that protects consumers from harassment and unfair debt collection strategies from third-party debt collectors. The CFPB oversees and enforces complaints from the FDCPA.

If you think Penn Credit is acting unlawfully, it’s your right to submit a complaint to the CFPB. You can even sue for compensation.

Another note: Although Penn Credit is a legitimate debt collection company, scammers may use their name or the name of another debt collector to try to get money from you. It’s important to validate any debt (more on this below) you’re contacted about before you give out any information. Protect yourself by being aware of the most common debt collector scams, and trust your gut if an interaction feels off.

Do I Have To Pay Penn Credit?

Before you can answer whether you have to pay Penn Credit, first figure out if the debt is legit. Debt collectors often have incomplete information, and case details frequently get mixed up. It’s important to validate the debt to confirm that you owe the money, that Penn Credit is the right company to pay, and that the amount is correct.

If the debt isn’t yours and Penn Credit can’t prove otherwise, you shouldn’t have to pay it. They should stop contacting you, and you can even send them a cease and desist letter to drive the point home.

If Penn Credit can prove the debt is yours and that they are responsible for collecting it, you have a few options for how to proceed.

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Step 1: Send a Debt Verification Letter

You can validate the debt in a couple of different ways. First, you may have received a debt validation letter from Penn Credit. By law, they’re required to send you this letter before contacting you or within five days of first contacting you. Along with outlining the details of the debt, this letter gives you 30 days to dispute the debt. During this time, Penn Credit can’t continue with collection actions. 

If you haven’t received a debt validation letter, you can send them a debt verification letter to request information to help you verify whether the debt is yours. You can also use this letter to dispute the debt if you disagree with it.

If Penn Credit can’t verify the debt, you shouldn’t have to pay it. If they do verify the debt, your next step depends on whether you agree with the amount they say you owe.  

Debt Validation Vs. Debt Verification Letters

Step 2: Decide What To Do Next

It might feel like Penn Credit holds all the power and you have to go along with what they say, but you do have some options! You can:

  • Dispute the debt, if you disagree with it.

  • Pay the debt in full, although this is not possible for most people

  • Negotiate to settle the debt for less than you owe, which is a common strategy. 

  • Ignore the debt, but this is not recommended.

Let’s go over these options in greater detail.

Option 1: Dispute the Debt

If you received a debt validation letter from Penn Credit but disagree with the amount they say you owe or some other detail about the debt, you have the right to file a dispute. Once again, the validation letter should note the deadline for doing so.

If a debt collector has incorrect information about a debt, they may have reported the same information incorrectly to the credit bureaus. If so, it could be hurting your credit score. 

To check for errors, request a copy of your credit report. You can get one for free from each credit bureau — TransUnion, Equifax, Experian — once every week. The Fair Credit Reporting Act (FCRA) gives you the right to dispute errors on your credit report, which you can do with a 609 credit dispute letter.

Option 2: Negotiate the Debt and Make a Settlement Offer

The quickest way to get Penn Credit to stop contacting you is to pay the debt off in full, but this isn’t possible for most people in this situation. Fortunately, you can also make a settlement offer and try to negotiate the debt to an amount that feels manageable to you.

Oftentimes, companies like Penn Credit share any recovered debts with the original creditor. Sometimes, they only get paid if they’re able to collect payment from you. This is an incentive for them to close the account, even if it means settling for less than the total amount owed. 

You can begin negotiations by suggesting a payment as low as 25% of the total debt, but be prepared for a few rounds of back and forth. Many creditors will settle for around 50% of the original amount due. If you want to learn more about how to negotiate a successful settlement, read Upsolve’s Guide to Beating Penn Credit.

Can You Negotiate Every Past-Due Debt?

Although not all debts can be negotiated, it’s usually an option for past-due consumer debts. If you have outstanding debt on credit cards, medical bills, personal loans, or payday loans, it’s often worthwhile to reach out to the creditor to try to negotiate the amount.

Tax debt is also often negotiable, and the IRS has a system in place for doing so.

Debts that are tied to property, such as mortgages or car loans, usually can’t be negotiated. The property backs up the loan, so the lender can foreclose the house or repo the car if you don’t pay the loan.

Typically, student loans can’t be negotiated either. The good news is that more and more student loan forgiveness options are becoming available. 

You can ignore Penn Credit’s phone calls or notifications, but it’s probably not in your best interest to do so. While it’s stressful to have a looming debt you aren’t able to pay, not addressing the situation can actually end up increasing your stress and money anxiety. Plus, it doesn’t make the debt go away.

What Happens if I Ignore Penn Credit?

If a debt collector contacts you and you don’t pay them, you could face serious consequences, such as:

  • Damage to your credit score

  • Increased debt in the long run, as interest charges, fees, and maybe even court costs, accrue

  • Legal action, and, if you ignore the lawsuit, potentially getting a wage garnishment order against you

Debt collectors don’t give up easily, and ignoring them could make them intensify their collection efforts. Even though negative information should drop off your credit report after seven years, the debt itself doesn’t disappear. Debt collectors can still collect on it as long as the statute of limitations hasn’t expired. 

Bottom line: It may be tempting to ignore a debt collector, but it won’t solve anything and could actually make your situation worse. Use the information in this article to empower yourself to put the debt behind you for good!

Can Penn Credit Sue Me?

If Penn Credit repeatedly contacts you but is unable to get payment from you, they could sue you. Whether they choose this route depends on several factors, such as:

  • Your state’s wage garnishment laws

  • The amount of time your debt has been in collections

  • The amount of money you owe

If you do get sued, you’ll know because you’ll receive official court documents called a summons and complaint. These papers are served in person or left with someone at your home. They tell you that you’re being sued and why. 

If you get sued, it’s important to answer the summons, which you can do without an attorney. If you ignore the summons, you risk losing the case by default. If this happens, Penn Credit can get a wage or bank account garnishment order to take your money.

If you want to learn more about how to deal with a debt lawsuit from Penn Credit, read Upsolve’s Guide to Beating Penn Credit.

Let’s Summarize…

Penn Credit is a third-party debt collector that collects debts on behalf of other companies and creditors. If you have an unpaid toll bill, utility bill, medical debt, or the like, Penn Credit is likely contacting you to collect payment. The most important thing you can do is validate the debt. You should be able to confirm that the debt is yours and the amount is correct. If the debt isn’t yours, dispute it. If it is your debt, consider negotiating a settlement to resolve the issue once and for all.

Written By:

Jonathan Petts


Jonathan Petts has over 10 years of experience in bankruptcy and is co-founder and CEO of Upsolve. Attorney Petts has an LLM in Bankruptcy from St. John's University, clerked for two federal bankruptcy judges, and worked at two top New York City law firms specializing in bankrupt... read more about Jonathan Petts

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