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What is a Debt Validation Letter?

By Edited May 1, 2016 1 2

Know Your Rights Under the Fair Debt Collections Act

The Debt Validation Letter

A debt validation letter is simply a letter that you send to the collection agency to request proof that you actually owe the money that they're claiming you must pay. The collection agency then has to send you the information you requested. If they do not send you the information that you requested then they are required by law to stop contacting you about collecting on the debt. If the credit agency continues to harass you after you have sent a debt validation letter but before they respond to your request then you may be able to sue them for violating the Fair Debt Collections Act.

Know Your Rights with Third Party Debt Collection

A debt validation letter is only used in cases where the original company sold off your debts to a third party company such as a debt collection agency. By law, a debt validation letter is not able to be requested or used when you are still dealing with the original company such as a bank or credit card company. If the bank sells off or gives your debt to a 3rd party company to attempt to collect on then you can send  a debt validation letter to the 3rd party company and request that they send you proof that the collection amount is valid.

How to Write and Send a Debt Validation Letter
Always Mail Your Debt Validation Letter via Registered Mail

When you send the validation letter to the debt collector you need to actually write or type the letter out by hand and then send it by registered mail. Using registered or certified mail that requires a signature from the recipient ensures that the debt collection agency cannot claim they did not receive it.

Within the letter you need to put the debt that you dispute. You can dispute the entire debt or just part of the debt. If you are not even sure what the debt is for then you can request the name of the original creditor.

The Debt Validation Letter and the Creditor

Use a Debt Validation Letter to Learn How Much You Have to Pay
A creditor has 30 days to answer your validation letter. If the creditor does not respond within 30 days then they are not legally allowed to attempt to collect on the debt. The credit agency also may not leave negative marks on your credit report about this particular debt. Many creditors will still leave a negative mark on your credit report. If the creditor never answered your debt validation letter within 30 days of receipt then you can dispute the negative marks with the credit reporting agencies. Send the credit reporting bureaus a copy of the registered letter you sent and proof that they received the letter. The credit bureau then has to remove the negative mark from your credit report.

The Fair Debt Collection Practices Act has to be followed by creditors and credit collection agencies. If they do not follow the law then you can use it to your advantage by getting your credit score cleaned up and even suing the creditors. You are able to sue creditors who violate the Fair Debt Collection Practices act. The first step to anybody attempting to improve their credit score is to always request a debt validation letter whenever you get notice of a new debt that has been turned over to a credit collection agency.

 
Negotiate and Settle Your Debts: A Debt Settlement Strategy
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Comments

Apr 16, 2012 3:50am
askformore
Thank you for a very useful article with precise information about debt problems. Thumbs up!
Apr 16, 2012 4:19am
tekaha
thank you for reading~ and yes its helpful to know what recourse folks have when it comes to debt collection.
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