What is Debt Validation: Make the Debt Collectors
and Junk Debt Buyers Prove You Owe Them
by Lisa Phillips - updated: May 1, 2010
and Junk Debt Buyers Prove You Owe Them
by Lisa Phillips - updated: May 1, 2010
A debt collector contacts you regarding a debt. How do you know this is your debt and that you
actually owe the collection agency? What if the debt has already been paid or perhaps the
Statute of Limitations has expired on the debt and you cannot be legally sued for the debt?
Debt buying is a growing, lucrative industry full of mistakes, errors and deceit. Debt validation
forces a collection agency, debt collector and even a law firm in the business of debt collection
prove you owe the debt. It is a powerful weapon against debt collectors which protects
consumers from unfair and deceptive debt collection practices.
actually owe the collection agency? What if the debt has already been paid or perhaps the
Statute of Limitations has expired on the debt and you cannot be legally sued for the debt?
Debt buying is a growing, lucrative industry full of mistakes, errors and deceit. Debt validation
forces a collection agency, debt collector and even a law firm in the business of debt collection
prove you owe the debt. It is a powerful weapon against debt collectors which protects
consumers from unfair and deceptive debt collection practices.
Related Topics:
"The failure of a consumer to dispute the validity of a debt under this section may not be
construed by any court as an admission of liability by the consumer."
Proper Debt Validation Documents
Debt collectors must provide proof you owe the debt to the original creditor, not to them.
Therefore, the validation must be in the form of documentation from the original creditor, not
the debt collector. That documentation can be account statements from the original creditor,
payment history from the original creditor, copy of the original signed loan agreement or a
credit card application with terms and interest rates. Validation should also include an itemized
accounting of the amount claimed to be owed, including all fees and charges and how those
fees and charges were determined.
Debt Collectors Purchase Debts for Pennies on the Dollar
It has become increasingly common for original creditors to sell bad debts. The debt collectors
purchase these debts in large portfolios for pennies on the dollar. Many times debt collectors
do not have any proof from the original creditor. They often only have basic information about
you and the amount of the debt. Often they have inflated that amount to include unknown fees
and interest rates. This does not make them the original creditor.
Improper Debt Validation Documents
Many unscrupulous collection agencies and junk debt buyers will simply send you a printed
form from their computers. The reason for this is they have no original proof. Oftentimes, when
junk debt buyer and collection agencies purchase charged off debts, they simply receive basic
information about you and the amount of debt on a spreadsheet with many other names,
address, and social security numbers (in whole or part) of other consumers. They typically
have no other back up documents from the original creditor.
Many debt collectors will simply send you a piece of paper entitled "Validation of Debt" or
"Verification of Debt" or even a computer generated form made to look like a billing statement
from the original creditor. This is not sufficient for debt validation. The Federal Trade
Commission has made it clear that a “mere itemization” is not sufficient proof to validate a debt.
These collection agencies realize they have no original documentation to prove the debt is
yours and will often resort to asking you to "help them" resolve the matter. After you request
debt validation, you may get a letter from the debt collector requesting you send in an old
statement from the original creditor or even a cancelled check of a payment you made to the
original creditor. DO NOT FALL FOR THIS TACTIC! Debt validation requires the debt collector
provide proof and documentation from the original creditor, not you. Do not help them!
Do Not Acknowledge the Debt
Never acknowledge you owe the debt. Make the collection agency or junk debt buyer prove
you owe the debt. Avoid getting on the phone with any collection agency, junk debt buyer or
collection agency law firm. Deal with them via U.S. Mail only. Acknowledging you owe the debt,
making payment arrangements or even making a partial payment on the debt may
re-start the statute of limitations on the debt.
Learn how to request debt validation.
construed by any court as an admission of liability by the consumer."
Proper Debt Validation Documents
Debt collectors must provide proof you owe the debt to the original creditor, not to them.
Therefore, the validation must be in the form of documentation from the original creditor, not
the debt collector. That documentation can be account statements from the original creditor,
payment history from the original creditor, copy of the original signed loan agreement or a
credit card application with terms and interest rates. Validation should also include an itemized
accounting of the amount claimed to be owed, including all fees and charges and how those
fees and charges were determined.
Debt Collectors Purchase Debts for Pennies on the Dollar
It has become increasingly common for original creditors to sell bad debts. The debt collectors
purchase these debts in large portfolios for pennies on the dollar. Many times debt collectors
do not have any proof from the original creditor. They often only have basic information about
you and the amount of the debt. Often they have inflated that amount to include unknown fees
and interest rates. This does not make them the original creditor.
Improper Debt Validation Documents
Many unscrupulous collection agencies and junk debt buyers will simply send you a printed
form from their computers. The reason for this is they have no original proof. Oftentimes, when
junk debt buyer and collection agencies purchase charged off debts, they simply receive basic
information about you and the amount of debt on a spreadsheet with many other names,
address, and social security numbers (in whole or part) of other consumers. They typically
have no other back up documents from the original creditor.
Many debt collectors will simply send you a piece of paper entitled "Validation of Debt" or
"Verification of Debt" or even a computer generated form made to look like a billing statement
from the original creditor. This is not sufficient for debt validation. The Federal Trade
Commission has made it clear that a “mere itemization” is not sufficient proof to validate a debt.
These collection agencies realize they have no original documentation to prove the debt is
yours and will often resort to asking you to "help them" resolve the matter. After you request
debt validation, you may get a letter from the debt collector requesting you send in an old
statement from the original creditor or even a cancelled check of a payment you made to the
original creditor. DO NOT FALL FOR THIS TACTIC! Debt validation requires the debt collector
provide proof and documentation from the original creditor, not you. Do not help them!
Do Not Acknowledge the Debt
Never acknowledge you owe the debt. Make the collection agency or junk debt buyer prove
you owe the debt. Avoid getting on the phone with any collection agency, junk debt buyer or
collection agency law firm. Deal with them via U.S. Mail only. Acknowledging you owe the debt,
making payment arrangements or even making a partial payment on the debt may
re-start the statute of limitations on the debt.
Learn how to request debt validation.
How Debt Validation Works
According to the Fair Debt Collection Practices Act (FDCPA) you
have the right to request a collection agency validate the debt
they are trying to collect. Essentially, the collection agency must
show that you owe the "original creditor" the debt, not the
"collection agency" attempting to collect the debt.
The collection agency is required to send you a debt validation
notice within five (5) days of their first communication with you. If
the first communication to you is a letter it may already include the
notice. The notice will contain a "mini Miranda" stating: "This is an
attempt to collect a debt and if we do not hear from you within 30
days of this notice, we will assume the debt to be valid."
Debt collectors can be very shady. Many will send letters with no
stamped postal information that lets you know when the letter was
mailed. Debt collectors never send these notices certified mail or
even registered mail so you have no way of knowing when the
30-day period begins.
You certainly cannot go by the date on their letter because in
many instances debt collectors back-date letters and, by the time
a consumer actually receives the letter, a week or two has gone
by according to the date on the letter.
Fortunately for the consumer, because the debt collector does
not send the letter certified or return receipt, they cannot prove
when the 30-day period began. You can still request debt
validation after the 30-day period has passed and question the
validity of the debt.
If fact, even if you did not request debt validation within 30 days of
the first contact, the courts will not consider you having admitted
to owing the debt or that the debt is valid. See FDCPA § 809 (c):
According to the Fair Debt Collection Practices Act (FDCPA) you
have the right to request a collection agency validate the debt
they are trying to collect. Essentially, the collection agency must
show that you owe the "original creditor" the debt, not the
"collection agency" attempting to collect the debt.
The collection agency is required to send you a debt validation
notice within five (5) days of their first communication with you. If
the first communication to you is a letter it may already include the
notice. The notice will contain a "mini Miranda" stating: "This is an
attempt to collect a debt and if we do not hear from you within 30
days of this notice, we will assume the debt to be valid."
Debt collectors can be very shady. Many will send letters with no
stamped postal information that lets you know when the letter was
mailed. Debt collectors never send these notices certified mail or
even registered mail so you have no way of knowing when the
30-day period begins.
You certainly cannot go by the date on their letter because in
many instances debt collectors back-date letters and, by the time
a consumer actually receives the letter, a week or two has gone
by according to the date on the letter.
Fortunately for the consumer, because the debt collector does
not send the letter certified or return receipt, they cannot prove
when the 30-day period began. You can still request debt
validation after the 30-day period has passed and question the
validity of the debt.
If fact, even if you did not request debt validation within 30 days of
the first contact, the courts will not consider you having admitted
to owing the debt or that the debt is valid. See FDCPA § 809 (c):
Recent Topics
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
 | |  | |  | |  | |  | |  | |  |
 |
 |
 |
 |
|
 |
|
 |
|
 |
|
 |
|
 |
|
 |
|
 |
 |