What to do when you discover a collection account on your credit report

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discover_collection_account_on_credit_reportsQuestion. I just pulled my credit and noticed I have a negative account with mountain land collection out of Utah (I reside in Arizona). I was researching trying to see if they are legally able to collect this debt and noticed there license is revoked and has been since 2005.

What can I do to get this debt off my credit? They are currently trying to collect $17,000. I am not even sure who the original creditor is. Please help!! Thanks!

Answer. There are several strategies you can use to fight this collection agency.

Strategy 1.  Request Debt Validation. Debt validation is a great tool you can use to deal with collection agencies. Under the Fair Debt Collection Practices Act (FDCPA) an alleged debtor can receive validation of an alleged debt.

You have the right to request the collection agency provide you proof the debt belongs to you. If they cannot provide proof, the collection agency should remove the debt from your credit report, although this may not happen without aggressive action on your part.

The collection agency may try to send you a 1-page printout with basic information about the debt as proof. This is insufficient. At a minimum an itemized accounting of how the total amount of debt was calculated including fees and interest should be included as debt validation.

Additional debt validation should include payment history with the original creditor and a copy of the original signed contract between the original creditor and debtor.

At the same time you request debt validation, dispute the debt with the credit bureaus. Although the FDCPA does not specify a time-frame in which collection agencies must respond to debt validation, 30-days should be sufficient for a response.

Disputing the debt with the credit bureaus at the same time of requesting debt validation puts pressure on the collection agency to provide proof. If the collection agency verifies the account with the credit bureaus but does not provide you debt validation, they have committed a violation and you have the basis for another dispute.

If the debt collector cannot provide validation, how can they verify a credit dispute? Unvalidated debt cannot be reported to the credit bureaus.

Strategy 2. In your situation debt validation may be completely unnecessary. Disputing the debt with the credit bureaus may do the trick. Since you mentioned their license is revoked, they may be out of business and not verify the dispute with the credit bureaus.

Strategy 3. The fact that their licensed is revoked is very interesting. This may work in your favor. You can make a complaint to your State’s Attorney General, the Federal Trade Commission and the Agency responsible for licensing debt collectors that the collection agency is attempting to collect a debt that is unknown to you and their license has been revoked since 2005.

This should do the trick. You’d be amazed what a complaint with your State’s Attorney General can do. Once they receive your complaint they will contact the debt collector and a typical response would be for the collection agency to remove the negative mark.

 

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