Debt validation is a powerful tool that is provided to you by the Fair Debt Collection Practices Act (FDCPA). When you are dealing with debt collectors it can be very overwhelming! When you are first contacted by a collection agency. You should request debt validation of your account, before you pay them.
When you request debt validation. Your saying to a bill collector “prove it to me.” Prove it, that this is my debt and you can legally collect payment on it. You can request debt validation by sending a written letter or hiring a credit attorney to do it on your behalf. Typically, the debt collection agency will respond within 30 days.
If they do not respond, then it is common for you to see the debt disappear on your credit report. However there is a record of collection agencies blatantly breaking federal regulations and ignoring consumer debt validation requests.
This is illegal. And the Federal Trade Commission or FTC has fined many collection agencies for violating your rights under the Fair Debt Collection Practices Act.
When you request debt validation. It is going to require the collection agency to give you legal evidence that they:
- Own the collection rights on your account
- It is in fact your debt account
- Your debt is within the statute of limitations or legal time window for which you are responsible for repayment
According to the experts, it is common for collection agencies to not validate your debt account. If this happens, then you are not responsible for repayment. And the debt collection agency is required to notify all 3 of the major credit bureaus. To have them remove negative credit information they have reported on your credit reports.
If your debt is validated. Then you should negotiate a settlement payment. One of the most common mistakes is people will pay a collection agency. With the idea that this will remove bad credit. This is false!
If you just pay a bill collector. The only item that will change on your credit report is the status of a collection. It will change from unpaid to paid. A paid collection is still a negative item to have on your credit report. It will cause your credit score to decrease dramatically.
Requesting validation of your debt is your federally protected right. Just like it is your right to vote. According to the Fair Debt Collection Practices Act you must request this validation within 30 days of first being contacted. However reports suggest that reputable collection agencies will validate a debt at anytime.
Don’t let aggressive, abusive, and lawbreaking collection agencies victimize you. You can also look at the sample debt validation letter below. If you choose to validate the debt yourself, we strongly encourage you to send your debt validation letter using certified mail.
Please, don’t request debt validation by phone. Debt collectors can claim you never requested validation, and you have no evidence to the contrary.
City, state & zip
Collection agency name
City, state & zip
Attention name of collection agency,
In accordance with my rights under the Fair Debt Collection Practices Act, I am hereby requesting formal validation of the alleged debt you are reporting to the major credit reporting agencies on my behalf.
Note that I am not requesting a simple account summary. Rather, you should forward the following expeditiously:
1. Validation that the alleged debt was established, including a signed application for credit.
2. Formal certification that the alleged debt was transferred to a third party if applicable.
3. Notarization regarding the alleged debts P&L application to federal or state tax write off.
4. A complete monthly accounting history from the alleged debt’s inception through the present date, including any alleged charges, penalties, service charges, and payments, as well as a certified attestation regarding current status.
5. Documentation regarding your company’s compliance, including applicable bond, regarding debt collection laws in my state.
I look forward to receiving the requested documentation so that this matter will not escalate further. Otherwise, you are prevented from reporting this account to the consumer reporting agencies.
Any further reporting is in violation of the Fair Debt Collection Practices Act (FDCPA) Sec. 809(b) 15 USC 1692g.
And your signature
Please remember if you choose to validate a debt account yourself send it using certified US postal mail. If you are rights have been violated. We urge you to report the collection agencies to your state attorney general and the Federal Trade Commission (FTC). Get a free credit consultation by calling toll-free 1-877-418-7596. For more tips and strategies with Dan Willis sign up for our free newsletter.
Get a FREE Credit Consultation 1-877-418-7596