Finding Sherman Financial Services on your credit report can feel overwhelming. If you've spotted this name among your credit accounts, you're likely wondering what it means, why they're there, and most importantly - how it affects your credit score.
This comprehensive guide breaks down everything you need to know about Sherman Financial Services. Their credit reporting practices, and your options for dealing with them.
Who is Sherman Financial Services
Sherman Financial Group, LLC is a massive debt collection company that purchases and administers consumer debt that has gone into default, buying debt from credit card companies, phone companies, student loan providers, mortgage banks, and other businesses. Based in New York City with operations extending across the United States and into Mexico, they're one of the largest players in the debt buying industry.
Sherman Financial Group uses many subsidiaries for debt collections, including Alegis Group, Credit One Bank, LVNV Funding and Resurgent Capital Services. This means you might see any of these names on your credit report, even though they're all connected to Sherman.
The company operates by purchasing portfolios of "bad debt" for pennies on the dollar - often paying just 2-5 cents for every dollar of debt they acquire. They then attempt to collect the full amount from consumers, making their profit margin substantial when successful.
Sherman Financial Services Business Model
Sherman Financial Services doesn't originate loans or provide credit services to consumers. Instead, they're what's called a "debt buyer."
Here's how their business model works in simple terms.
When you fall behind on payments to your original creditor (like a credit card company or medical provider), that creditor may eventually "charge off" your account. Rather than continue trying to collect the debt themselves, they sell it to companies like Sherman Financial Services.
Sherman purchases these debts in large portfolios, sometimes containing thousands of accounts. They might pay $500 for a portfolio containing $10,000 worth of charged-off debts. Their goal is then to collect as much as possible from the original debtors.
Is Sherman Financial Services Legitimate
Yes, Sherman Financial Services is a legitimate debt collection company, but that doesn't mean they always operate fairly or within legal boundaries.
Sherman is a privately held company and is one of the largest distressed consumer debt buyers in the country - if not the world. Their status as a private company means less public scrutiny of their operations.
Customer Reviews and Complaints
Consumer experiences with Sherman Financial Services vary widely. Many complaints center around several common issues.
Aggressive collection tactics top the list of consumer grievances. Many people report receiving multiple daily phone calls, calls at inappropriate hours, and threatening language from Sherman's representatives.
Debt validation problems also plague consumers. Sherman sometimes struggles to provide adequate documentation proving they own the debt and that the amount they're claiming is accurate. This becomes particularly problematic when the debt has been sold multiple times.
Credit reporting errors represent another major concern. Consumers frequently discover inaccurate information on their credit reports, including wrong amounts, incorrect dates, or debts that should have aged off their reports.
Some consumers have successfully challenged Sherman's collection attempts and won. Others have negotiated settlements for significantly less than the claimed amount.
Why Sherman Financial Services is Calling You
If Sherman Financial Services is contacting you, it's because they believe you owe money on a debt they've purchased. However, just because they're calling doesn't mean their claim is valid or accurate.
Common Reasons for Contact
They might have purchased your old credit card debt that went unpaid for several months or years. Medical bills that were sent to collections often end up in Sherman's portfolio. Utility bills, cell phone bills, and other service-related debts also commonly get sold to debt buyers like Sherman.
Sometimes Sherman contacts people about debts that aren't actually theirs. This happens due to mixed files, identity theft, or simply purchasing inaccurate data from the original creditor.
Your Rights When They Call
Under the Fair Debt Collection Practices Act (FDCPA), you have specific rights when dealing with debt collectors like Sherman Financial Services.
You can request debt validation within 30 days of their first contact. This means they must provide written proof that you owe the debt, the amount is accurate, and they have the right to collect it.
You can also request that they cease all phone contact and communicate only in writing. This helps create a paper trail and reduces harassment.
If they can't validate the debt properly, they cannot continue collection efforts or report it to credit bureaus.
Does Sherman Financial Services Show on Credit Report
Yes, Sherman Financial Services can and often does report to the major credit bureaus (Experian, Equifax, and TransUnion).
When they do, it typically appears as a collection account, which can significantly damage your credit score.
How Collections Appear on Credit Reports
Collection accounts from Sherman Financial Services usually show up in the "Collections" or "Public Records" section of your credit report. The entry might display as "Sherman Financial Services," "LVNV Funding," "Resurgent Capital Services," or another subsidiary name.
These entries typically include the original creditor's name, the current balance Sherman claims you owe, the date the account was opened with Sherman, and the date of last activity.
Impact on Your Credit Score
Collection accounts can drop your credit score by 50-100 points or more, depending on your overall credit profile. The impact is usually most severe if it's your first collection account or if your credit was previously good.
The good news is that newer credit scoring models (FICO 9 and VantageScore 3.0 and 4.0) give less weight to paid collections. Some ignore paid medical collections entirely.
However, many lenders still use older scoring models where all collections have significant negative impact, regardless of whether they're paid.
Timeline for Credit Reporting
Collection accounts can remain on your credit report for up to seven years from the date you first became delinquent with the original creditor. This is true even if the debt is sold multiple times.
Sherman cannot "restart" this seven-year clock by purchasing your debt. The timeline is based on the original delinquency date, not when Sherman acquired the account.
How to Remove Sherman Financial Services from Your Credit Report
Removing Sherman Financial Services from your credit report requires a strategic approach. You have several options, ranging from dispute processes to negotiation.
Debt Validation Process
Start by requesting debt validation if Sherman is actively trying to collect from you. Send a certified letter within 30 days of their first contact asking them to validate the debt.
They must provide documentation showing they own the debt, the amount is accurate, and you actually owe it. If they cannot provide adequate proof, they must remove it from your credit report and cease collection efforts.
Many consumers successfully get Sherman Financial Services removed from their credit reports through this process, especially on older debts where documentation may be incomplete.
Credit Report Disputes
You can dispute the Sherman Financial Services entry directly with the credit bureaus. Common grounds for disputes include incorrect amounts, wrong dates, accounts that aren't yours, or debts beyond the seven-year reporting limit.
File disputes with all three major credit bureaus since Sherman might not report to all of them. The bureaus have 30 days to investigate and respond to your dispute.
If Sherman cannot verify the information with the credit bureau, the account must be removed from your credit report.
Negotiation Strategies
If the debt is valid but you want it removed from your credit report, consider negotiating a "pay for delete" agreement. This involves offering to pay Sherman in exchange for them removing the negative information from your credit reports.
Get any agreement in writing before making payment. Sherman isn't required to honor verbal agreements, and some collectors will take your money without removing the credit reporting.
Be aware that not all debt collectors agree to pay-for-delete arrangements, and some may offer "payment in full" settlements that don't include credit report removal.
Statute of Limitations Considerations
Each state has a statute of limitations on debt collection, typically ranging from three to six years. If Sherman is trying to collect on a debt beyond your state's statute of limitations, you may have a defense against their collection efforts.
However, the statute of limitations doesn't automatically remove the debt from your credit report. The seven-year credit reporting timeline is separate from the statute of limitations for collection.
Making any payment or acknowledging the debt in writing can restart the statute of limitations in some states, so be careful about your communications with Sherman.
Dealing with Sherman Financial Services Lawsuits
Sherman Financial Group is one of those aggressive debt collectors that you need to stand up to, and if you receive a notice that Sherman Financial Group is suing you in court on a debt, do not throw it away.
Responding to a Lawsuit
If Sherman Financial Services sues you, respond within the timeframe specified in your court documents (usually 20-30 days). Failing to respond results in a default judgment, giving them the right to garnish wages or freeze bank accounts in many states.
In your response, you can raise defenses such as the statute of limitations, lack of proper documentation, or challenging their standing to sue (their right to collect the debt).
Many consumers successfully defend against these lawsuits, especially when Sherman lacks proper documentation or when the debt is very old.
Settlement Options
Even if Sherman has filed a lawsuit, you can often negotiate a settlement. They may accept 20-40% of the claimed amount to avoid the cost and uncertainty of court proceedings.
Make sure any settlement agreement includes dismissal of the lawsuit and, if possible, removal of negative credit reporting.
Get all settlement terms in writing before making any payment. Never agree to payment plans unless absolutely necessary, as they can be difficult to maintain and may not resolve the lawsuit.
Protecting Yourself from Sherman Financial Services
Prevention and preparation are your best defenses against problematic debt collection practices.
Know Your Rights
Familiarize yourself with the Fair Debt Collection Practices Act and your state's debt collection laws. Sherman must follow specific rules about when they can call, what they can say, and how they can attempt collection.
Document all communications with Sherman Financial Services. Keep detailed records of phone calls, letters, and any payments made. This documentation becomes crucial if you need to file complaints or defend against collection actions.
Monitor Your Credit Reports Regularly
Check your credit reports from all three bureaus at least annually, or more frequently if you're dealing with debt issues. Look for any Sherman Financial Services entries or accounts from their subsidiaries.
Free credit monitoring services can alert you when new collection accounts appear on your reports, allowing you to address them quickly.
Professional Help Options
Consider working with a credit repair professional who understands debt collection laws and credit reporting requirements. Experienced credit repair companies like ASAP Credit Repair can help you navigate the complex process of dealing with Sherman Financial Services and other debt collectors.
Professional credit repair services can handle communications with Sherman, file appropriate disputes, and negotiate on your behalf. They understand the legal requirements debt collectors must meet and can identify when Sherman has violated your rights.
Many consumers find that professional help saves time and achieves better results than trying to handle everything themselves.
Your Path to Victory Against Sherman Financial Services
Sherman Financial Services might seem intimidating, but you have more power than you realize. Armed with knowledge of your rights and proper strategy, you can effectively challenge their collection efforts and protect your credit.
Remember that Sherman purchased your debt for pennies on the dollar. They often lack complete documentation and may be willing to settle for much less than they claim you owe.
The key is taking action rather than ignoring the situation. Whether through debt validation, credit disputes, or negotiated settlements, you have multiple paths to resolve Sherman Financial Services issues.
Take Action Against Sherman Financial Services
Don't let Sherman Financial Services continue damaging your credit and financial future. Every month that collection account remains on your credit report, it's hurting your ability to get loans, credit cards, apartments, and even jobs.
If you're dealing with Sherman Financial Services on your credit report or through collection calls, consider getting professional help. ASAP Credit Repair specializes in handling aggressive debt collectors like Sherman Financial Services and can help you explore all your options for removal and resolution.
The sooner you take action, the sooner you can start rebuilding your credit and moving forward with your financial goals. You don't have to face Sherman Financial Services alone - help is available, and victory is possible.
Your credit report doesn't have to be held hostage by debt collectors. With the right approach and professional guidance, you can win against Sherman Financial Services and reclaim control of your financial future.