Earlier than you pay a dime to a debt collector, verify that the debt belongs to you. Debt collectors are legally required to ship you a debt validation letter, which outlines what the debt is, how a lot you owe and different info.
In case you're nonetheless unsure concerning the debt you're being requested to pay, you possibly can ship the debt collector a debt verification letter requesting extra info. This selection is greatest should you plan to pay the debt in collections.
These two letters are vital as a result of errors in debt assortment are frequent. You don’t wish to pay a sum you don’t owe or by accident revive an outdated debt that may be previous the statute of limitations. And also you don’t wish to fall sufferer to a debt assortment rip-off.
Right here’s how you can perceive your debt validation letter and what to do should you want a debt verification letter, together with the place to seek out pattern letters.
Actually get to know your cash
NerdWallet provides you an entire view of your cash, payments, money owed and spending – multi function place.
Evaluate the debt validation letter
Collectors are required by Honest Debt Assortment Practices Act to ship you a written debt validation discover with details about the debt they're attempting to gather. It should be despatched inside 5 days of the primary contact.
The debt validation letter contains:
The identify of the creditor looking for cost.
A press release that the debt is assumed legitimate by the collector except you dispute it inside 30 days of the primary contact.
A press release that should you write to dispute the debt or request extra info inside 30 days, the debt collector will confirm the debt by mail.
A press release that should you request details about the unique creditor inside 30 days, the collector should present it.
In case you don’t obtain a validation discover inside 10 days of the primary contact, request one from the debt collector the following time you’re contacted. Ask for the debt collector’s mailing tackle at the moment as properly, in case you determine to request a debt verification letter.
Write a debt verification letter
The validation letter may depart you with extra questions than solutions.
In that case – or should you by no means acquired a validation discover – you possibly can request a verification letter proving this debt is in actual fact yours.
Verification letters are greatest utilized in two circumstances:
In case you're dealing with an aggressive debt collector: A debt verification letter can pause assortment efforts and should deter debt collectors who don't have enough info.
In case you intend to pay the debt: To resolve the account, you may want extra info to confirm you're paying the suitable collector for the suitable debt.
If the debt is nearing its statute of limitations, for instance, you might be higher off ignoring debt assortment notices than drawing extra consideration to your self with a verification letter.
The CFPB has pattern letters you should use. The secret’s to be thorough in your request for debt verification.
In your letter, ask for particulars on:
Why the collector thinks you owe the debt: Ask who the unique creditor is and request documentation that verifies you owe the debt, reminiscent of a replica of the unique contract.
The quantity and age of the debt: Ask for a replica of the final billing assertion despatched by the unique creditor, the quantity owed when the collector bought the debt, the date of final cost and whether or not the debt is previous the statute of limitations.
Authority to gather the debt: Ask whether or not this company is licensed to gather debt in your state.
You could wish to ship this letter by licensed mail and request return receipt so you possibly can doc the correspondence between you and the debt collector.
Though you possibly can ask for a lot of particulars, debt collectors are solely required to offer info on the unique creditor, the balanced owed and the identify of the one that owes the debt earlier than resuming assortment efforts.
It's a violation of the gathering practices act for a debt collector to refuse to ship a validation discover or fail to reply to your verification letter.”
Getting even that quantity of data, nevertheless, may help you identify should you really owe this debt, if it’s previous the statute of limitations, or if there’s an error reminiscent of overstatement of the quantity owed.
In case you ship the letter inside 30 days of the primary contact, the debt collector should cease attempting to gather cost till it verifies that the debt is yours. You may nonetheless ship a verification letter after the 30-day mark, however the debt can be assumed legitimate and the collector can proceed to hunt cost whereas it responds to your letter.
It's a violation of the gathering practices act for a debt collector to refuse to ship a validation discover or fail to reply to your verification letter. In case you encounter such conduct, you possibly can file a criticism with the Shopper Monetary Safety Bureau.