How To Deal With A Debt Collector About An Invalid Claim

When a debt collector calls, consumers know right away if it is a valid claim or an error – or even a scam. Knowing what your rights are will help you deal with it more efficiently and with less stress.

If you know it to be a valid debt, you are still protected by law from abusive tactics from debt collectors, who frankly will do whatever they can to see that the debt is collected. It's a good idea to read the text of the Fair Debt Collection Practices Act (FDCPA) so that you can respond accordingly.

Increasingly, however, consumers are being contacted about debts that they believe to be bogus. For example, since last year many former Hollywood Video customers have been contacted by a debt collector who states they owe late fees for unreturned videos rented from the now-defunct movie chain.

Taken by surprise

Many are at a loss over how to respond. When they say they don't owe the $100 or more bill, they say the debt collector often offers to settle the debt for much less, such as a $45 credit card payment. This is always a very bad idea.

In cases like this, section 809 of the FDCPA, dealing with “validation of debts,” is worth reviewing.

If a debt collector calls about a debt you don't believe to be legitimate, tell them that you don't believe it to be real and that any further communication must be in writing. At that point, they must, within five days, send you a written notice of the alleged debt. That notice must contain:

• the amount of the debt;
• the name of the creditor to whom the debt is owed;
• a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector;
• a statement that if the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and
• a statement that, upon the consumer’s written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor.

If the debt collector does, in fact, send such a letter, respond in writing within 30 days that you are disputing the validity of the debt and that you demand “verification of the debt.” If the debt is legitimate, and you simply forgot about it, the debt collector will be able to provide the documentation. If the debt is bogus, and the debt collector is simply scamming you, they won't be able to provide the necessary proof.

Be sure to keep copies of all correspondence with the debt collector. In case they make a negative report to the credit agencies, proof that you handled the matter within the law and showed the claim to be invalid may help you get the information removed.