Collection agencies are businesses who get paid to collect debts on behalf of a company or buy the debts of a company to collect the full amounts for themselves.
It serves them best to collect the debt because they make their profit solely from the proceeds of debt collections. They do not care about your problems, history, or situation. As far as they are concerned, that is your problem. They are only concerned that you pay the debt which was presented to them in good faith and you do it immediately in whatever way you can.
Of course, they are not perfect. Sometimes they make mistakes. Sometimes the company sends them the wrong information. If a collection agency contacts you regarding a debt (or a portion of a debt) that you don't believe you owe, there are specific things you must do to document the dispute.
Be sure to keep a copy of all letters you send as well as letters they send you in a file to be kept handy for up to 15 years.
Ideally, when the collection agency first contacts you, you need to dispute the debt in writing within 30 days. You cannot just dispute it over the phone. With all letters of communications to collection agencies, send them certified mail WITH return signature receipt so you will have a record mailed back to you with their signature as proof they did receive it. Send them a dispute letter by certified mail such as this one:
Your Name
Your Address
Your City, State Zip Code
Today's Date
The F'd Up Collection Agency
666 Demon Street
Hells Bells NY 66666
RE: Account #
To Whom It May Concern:
You have recently contacted me in regards to an alleged debt to Company ZYX. I do not believe I owe the money you say I owe. Consider this a formal dispute.
This is the first I've heard from you, or any other company on this matter therefore, in accordance with the Fair Debt Collection Practices Act, Section 809(b):
Validating Debts:
(b) If the consumer notifies the debt collector in writing within the thirty-day period described in subsection (a) that the debt, or any portion thereof, is disputed, or that the consumer requests the name and address of the original creditor, the debt collector shall cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt or any copy of a judgment, or the name and address of the original creditor, and a copy of such verification or judgment, or name and address of the original creditor, is mailed to the consumer by the debt collector.
I respectfully request that you provide me with the following information:
- The amount of the debt;
- The name of the creditor to whom the debt is owed;
- Provide a verification or copy of any judgment (if applicable);
- Proof that you are licensed to collect debts in (insert name of your state)
I am fully aware of my rights under the Fair Debt Collection Practices Act and the Fair Credit Reporting Act.
I know that:
- Because I have disputed this debt in writing within 30 days of receipt of your dunning notice, you must obtain verification of the debt or a copy of the judgment against me and mail these items to me at your expense;
- You cannot add interest or fees accept those allowed by the original contract or state law.
- You do not have to respond to this dispute but if you do, any attempt to collect this debt without validating it, violates the FDCPA;
Also be advised that I am keeping very accurate records of all correspondence from you and your company including recording all phone calls and I will not hesitate to report violations of the law to my State Attorney General, the Federal Trade Commission and the Better Business Bureau.
I am disputing this debt. Therefore, until validated you know your information concerning this debt is inaccurate. Thus, if you have already reported this debt to any credit-reporting agency (CRA) or Credit Bureau (CB) then, you must immediately inform them of my dispute with this debt.
Reporting information that you know to be inaccurate or failing to report information correctly violates the Fair Credit Reporting Act § 1681s-2. Should you pursue a judgment without validating this debt, I will inform the judge and request the case be dismissed based on your failure to comply with the FDCPA.
Finally, if you do not own this debt, I demand that you immediately send a copy of this dispute letter to the original creditor so they are also aware of my dispute with this debt.
YOUR NAME HERE
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Upon receiving your letter, the collection agency must halt collection activity until a copy of a debt verification is sent to you.
A verification may include a signed agreement, a copy of a judgment against you regarding the debt or an itemized statement of services rendered under your name (or the name of a dependent or spouse). It can also be as simple as a copy of the last bill the creditor sent you.
The collection agency cannot report the disputed debt to a credit bureau without also reporting that it is being disputed. However, if the collection agency reports the debt to a credit bureau before you dispute it, they are not obligated to update the credit bureau report.
If the debt cannot be verified by the creditor, the collection agency must cease collection activity on the account.
Chances are, if the agency bought the debt from the company there will be no proof, but don't count on this being the case in every instance. If there is no proof sent to you within 30 days, follow it up with another certified letter like this:
Your Name
Your Address
Your City, State Zip Code
Today's Date
The F'd Up Collection Agency
666 Demon Street
Hells Bells NY 66666
RE: Account #
To Whom It May Concern:
I am writing to follow up on a letter I sent you over 30 days ago to dispute the debt you say I owe to Company ZYX.
On {date you sent first dispute letter} I sent you a letter explaining that I do not believe I owe what you say I owe and, in accordance with the Fair Debt Collection Practices Act, 15 USC 1692g, Section 809(b):
Validating Debts:
(b) If the consumer notifies the debt collector in writing within the thirty-day period described in subsection (a) that the debt, or any portion thereof, is disputed, or that the consumer requests the name and address of the original creditor, the debt collector shall cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt or any copy of a judgment, or the name and address of the original creditor, and a copy of such verification or judgment, or name and address of the original creditor, is mailed to the consumer by the debt collector.
I must remind you that in my previous letter I requested the following information:
- The amount of the debt;
- The name of the creditor to whom the debt is owed;
- Provide a verification or copy of any judgment (if applicable);
- Proof that you are licensed to collect debts in (insert name of your state)
I also requested that if you have reported me to any credit reporting agency, that you inform them that I have placed this debt in dispute and to provide me with proof that you have done so. Furthermore, I asked that you immediately send a copy of that dispute letter to the company (creditor) that you say I owe money so they are also aware of my dispute with this debt.
As of today, you have failed to respond to my requests! For your convenience, I have included a copy of my previous letter and a copy of the mail receipt showing that you received my letter on {insert date from mail receipt}.
Since you have failed to respond I assume that you have been unable to validate the debt and therefore, I consider this matter closed. You may consider this letter your official notification that I do not intend to correspond with you on this matter again unless you comply with my requests, the FDCPA and the FCRA.
I must remind you that any attempt to collect this debt without validating it, violates the FDCPA and that I am recording all phone calls and keeping all correspondence concerning this matter. Be advised that I will not hesitate to report violations of the law to my State Attorney General, the Federal Trade Commission and the national Better Business Bureau.
Your Printed Name
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Bill collectors are seldom able to properly validate debts because the original creditor has lost, misplaced or deleted your account information or the debt has been sold so many times it's nearly impossible to validate it with the original creditor.
When collectors cannot validate a debt, they often sell the debt to another junk debt buyer. Because the FDCPA does not require collectors to tell you when they sell your account and the law prohibits collectors from sharing your information with other collectors, you can expect to be contacted by a different collection agency thus forcing you to dispute the debt all over again.
If verification is obtained from the creditor, the collection agency must mail a copy of the verification to you. It may then continue its efforts to collect the debt.
A legitimate debt should never be disputed merely to postpone repayment. In doing so you risk losing any leniency the creditor or collection agency may have granted you in paying back your debt.
CEASE AND DESIST!
If the debt is legitimate the collection agency has every right to contact you to demand payment. However, they are required to abide by certain rules.
They cannot call before 8AM or after 9PM if they work for a collection agency unless you have sent them written instructions otherwise. The original creditor, however, does not have to abide by this rule.
They cannot harass you. Calling to demand payment is not enough to claim harassment. Harassment would include verbal abuse, vulgar language, threats of physical violence, derogatory remarks as well as calling constantly in a day for the purpose of being annoying, hang up calls, or making threats of legal action they cannot take.
They cannot publicize your debt in any way. This includes sending you communication by post card, including on an envelope that you are owing a debt, tell anyone [other than a spouse or a child] that you owe a debt, or print your name where people will see you owe a debt.
They cannot write telling you they have started proceedings for a legal action if they have not in fact done so.
They cannot contact you at work if you have sent them a letter telling you the calling work is off limits.
If a collection agency is acting abusive while collecting a debt, you do not have to stand for it. You do have the right to be treated humanely.
When collectors are calling several times a day demanding money or they've been calling for weeks harassing you and your family and you're stressed out just want the calls to stop, you do have an option.
According to the Fair Debt Collection Practices Act, [15 USC 1692c] Section 805(c): CEASING COMMUNICATION:
"If a consumer notifies a debt collector in writing that the consumer refuses to pay a debt or that the consumer wishes the debt collector to cease further communication with the consumer, the debt collector shall not communicate further with the consumer with respect to such debt."
Should the creditor, debt collector, or credit reporting or repair agency violate the law, you will have the necessary documentation to prove it, and perhaps sue them in civil court. If you encounter difficulty and need to hire a lawyer or file a formal complaint, accurate records are needed to support your case.
Your Name
Your Address
Your City, State Zip Code
Today's Date
The F'd Up Collection Agency
666 Demon Street
Hells Bells NY 66666
To Whom It May Concern:
I am writing in response to your constant phone calls. According to the Fair Debt Collection Practices Act, [15 USC 1692c] Section 805(c): CEASING COMMUNICATION: You must cease all communication with me after being notified in writing that I no longer wish to communicate with you. Therefore, I demand that you stop calling me at home, at work, on my cell phone or at any other location.
In accordance with the federal FDCPA, now that you have received this "stop calling" letter, you may only contact me to inform me that you:
- Are terminating further collection efforts;
- Invoking specified remedies which are ordinarily invoked by you or your company; or
- Intend to invoke a specified remedy.
Be advised that I am well well aware of my rights! For instance, I know that any future contact by you or your company violates the FDCPA and that since you already have my location information, calls made by you or your company to any 3rd party concerning me violates section 805(b)2 of the FDCPA.
Be advised that I am keeping accurate records of all correspondence from you and your company, including tape recording all phone calls. If you continue calling me I will pursue all available legal actions to stop you from harassing me and my family.
Signature
Your Printed Name
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Has The Debt Reached Statue Of Limitations? You Don't Owe!
Another reason why you may not have to deal with the collection agency or they could not give you proof of the debt - the debt has reached the statute of limitations [SOL].
Perhaps you have been called out of the blue by a collection agency about a debt you may or may not have remembered from 15 years ago. You may owe it, but legally are not required to pay it. First off, get the name and address of the collection agency along with the account number and send them a letter like this by certified mail:
Your Name
Your Address
Your City, State Zip Code
Today's Date
The F'd Up Collection Agency
666 Demon Street
Hells Bells NY 66666
RE: Account Number
To Whom It May Concern:
I do not believe I owe the debt you say I owe. I am demanding proof that this is a valid debt.Consider this a formal dispute.
This is the first I've heard from you, or any other company on this matter therefore, in accordance with the Fair Debt Collection Practices Act, Section 809(b):
Validating Debts:
(b) If the consumer notifies the debt collector in writing within the thirty-day period described in subsection (a) that the debt, or any portion thereof, is disputed, or that the consumer requests the name and address of the original creditor, the debt collector shall cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt or any copy of a judgment, or the name and address of the original creditor, and a copy of such verification or judgment, or name and address of the original creditor, is mailed to the consumer by the debt collector.
I respectfully request that you provide me with the following information:
- The amount of the debt;
- The name of the creditor to whom the debt is owed;
- Provide a verification or copy of any judgment (if applicable);
- Proof that you are licensed to collect debts in (insert name of your state)
I am fully aware of my rights under the Fair Debt Collection Practices Act and the Fair Credit Reporting Act.
I know that:
Because I have disputed this debt in writing within 30 days of receipt of your dunning notice, you must obtain verification of the debt or a copy of the judgment against me and mail these items to me at your expense;
You cannot add interest or fees accept those allowed by the original contract or state law.
You do not have to respond to this dispute but if you do, any attempt to collect this debt without validating it, violates the FDCPA;
Also be advised that I am keeping very accurate records of all correspondence from you and your company including recording all phone calls and I will not hesitate to report violations of the law to my State Attorney General, the Federal Trade Commission and the Better Business Bureau.
I am disputing this debt. Therefore, until validated you know your information concerning this debt is inaccurate. Thus, if you have already reported this debt to any credit-reporting agency (CRA) or Credit Bureau (CB) then, you must immediately inform them of my dispute with this debt.
Reporting information that you know to be inaccurate or failing to report information correctly violates the Fair Credit Reporting Act § 1681s-2. Should you pursue a judgment without validating this debt, I will inform the judge and request the case be dismissed based on your failure to comply with the FDCPA.
Finally, if you do not own this debt, I demand that you immediately send a copy of this dispute letter to the original creditor so they are also aware of my dispute with this debt.
Signature
Your Printed Name
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Every state has an SOL on the books for when time has expired in order to take legal actions to collect debts. Although the debt may have reached SOL, that does not prohibit creditors and collectors from attempting to collect the debt. It just means the courts cannot be used to force you to pay the debt through legal actions such as judgments, liens, wage garnishments and so forth.
SOL is almost always counted as beginning on the first missed payment date with the original creditor. Time is counted from that date forward. At any time, if you once acknowledge making a payment arrangement and miss it, the count begins with that new day.
Assuming a debt is valid, once it expires, it's up to you to decide whether or not to pay it.
If you choose not to pay the debt send a letter informing them of the expired statute of limitation and your intention to use it as your defense should they decide to pursue legal actions.
As most collection agencies go after payment for open or revolving accounts, such as credit, medical bills, and the like, I will cover only this area.
Laws can change, but these are the general rules by state. It goes into effect the day the last missed payment was registered. Judgments, contracted deals, and real estate actions have too many variables to be listed here. See if this applies to your situation:
- Alabama - 3 years
- Alaska - 3 years
- Arizona - 3 years
- Arkansas - 3 years if not in writing, 5 years if in writing
- California - 4 years
- Colorado - 3 years
- Connecticut - 3 years
- Delaware - 3 years
- District of Columbia - 3 years
- Florida - 4 years
- Georgia - 4 years
- Hawaii - 4 years
- Idaho - 4 years
- Illinois - 5 years
- Indiana - 6 years
- Iowa - 5 years
- Kansas - 5 years if in writing, 3 years if not
- Kentucky - 4 years
- Louisiana - 3 years
- Maine - 6 years
- Maryland - 3 years
- Massachusetts - 6 years
- Michigan - 6 years
- Minnesota - 6 years
- Mississippi - 3 years
- Missouri - 5 years
- Montana - 8 years if in writing, 5 years if not
- Nebraska - 5 years if in writing, 4 years if not
- Nevada - 6 years if in writing, 4 years if not
- New Hampshire - 3 years
- New Jersey - 3-4 years
- New Mexico - 6 years
- New York - 4 years
- North Carolina - 3 years
- North Dakota - 4 years
- Ohio - 6 years
- Oklahoma - 5 years
- Oregon - 6 years
- Pennsylvania - 4 years
- Rhode Island - 10 years
- South Carolina - 3 years
- South Dakota - 6 years
- Tennessee - 6 years
- Texas - 4 years
- Utah - 4 years
- Virginia - 3 years
- Vermont - 6 years
- Washington - 6 years
- West Virginia - 5 years
- Wisconsin - 6 years
- Wyoming - 10 years
If your debt qualifies for SOL, this is a letter you can send:
Your Name
Your Address
Your City, State Zip Code
Today's Date
The F'd Up Collection Agency
666 Demon Street
Hells Bells NY 66666
RE: Account Number
To Whom It May Concern:
This letter is in response to your communication concerning the collection of the above referenced account which dates back to [state the date here].
I do not believe I owe what you say I owe therefore I dispute this debt. I am well aware of my rights under the Fair Debt Collection Practices Act (FDCPA) and my state laws so I hope to save both of us a great deal of time by letting you know that not only do I dispute the validity of this debt, I have also checked with my State Attorney General and verified that the Statute of Limitations for enforcing this type of debt through the courts in (insert your state or the state in which the contract was signed) has expired. Therefore, should you decide to pursue this matter in court I intend to inform the court of my dispute of this debt and that the "statute of limitations" has expired.
This letter is your formal notification that I consider this matter closed and demand that you, or anyone affiliated with your company, stop contacting me regarding this or any other matter except to advise me that your debt collection efforts are being terminated or that you or the creditor are taking specific actions allowed by the FDCPA or my state laws.
Be advised that I consider any contact not in accordance with the Fair Debt Collection Practices Act a serious violation of the law and will immediately report any violations to my State Attorney General, to the Federal Trade Commission and, if necessary, take whatever legal action is necessary to protect myself. Be advised that I tape record all phone calls and violations of the FDCPA can result in you or your company being personally fined up to $1,000 per incident.
Signature
Your Printed Name
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