Debt Validation

The term “debt validation” refers to your right to request proof from a third-party debt collector that you owe what they claim you owe, and that they are legally entitled to collect that debt from you. This right is afforded to you under the Fair Debt Collection Practices Act (FDCPA), so it only applies to collection agencies and junk debt buyers, not to original creditors.

Under what circumstances should you request debt validation?

You may have already guessed that a debt validation request is in order when a collection agency or junk debt buyer attempts to collect a debt from you and you are unsure of the legitimacy of the debt. While that’s true, you can and should request debt validation any time a collection agency or junk debt buyer contacts you for payment for a debt and/or lists a debt on your credit report.**

Here’s why: Even if you suspect that you did owe the debt in question to an original creditor, you cannot possibly know for certain that a particular debt collector is legally entitled to collect it from you. They need to show you proof of that before you even consider making payment! Until they do, how do you know they really are who they say they are? Any old scam artist could sit down and start dialing random phone numbers, pretending to work for a collection agency and demanding payment!


When should you request debt validation?

The best time to request it is within 30 days of the collector’s first contact to you. Once they receive notice of your request for validation, they are required per the FDCPA to stop all collection activity until they have validated the debt. However, if you do not request validation within 30 days, this will not apply.

What if you miss this 30-day window?

Don’t despair; all is not lost! First, be aware that even though the debt collector legally has the right to assume the debt is valid if you don’t request validation within 30 days, the courts (if it ever goes that far) will never consider your failure to make the request to be an admission that you owe the debt!

Secondly, if the collector has placed the debt on your credit reports, it’s never too late to dispute that listing with the credit bureaus and the collector. Per the Fair Credit Reporting Act (FCRA), if you dispute the listing and the collection agency or JDB can’t prove that what they are reporting is accurate, they must either delete or correct the listing. This is always the case, regardless of when you dispute.

And thirdly, it’s not too late to stop collectors’ harassing phone calls even if you miss the 30-day validation window. Per the FDCPA, you may notify a collector in writing at any time that they must cease and desist contact with you. They are required to comply with your request no matter when you send it. (However, I recommend sending them what is referred to as a “limited cease and desist”, which means you forbid them from contacting you by telephone but allow them to contact you in writing. This is because if you forbid a collector from contacting you at all, they can then sue you to recover the debt because that would be their only available means of collecting if you won’t allow them to communicate with you.)

How do you request validation?

Your request must be made in writing, and you should send it via certified mail with return receipt requested. Be sure to keep a copy of the letter you send and the receipt. Here is a sample debt validation letter to give you an idea of what your letter should say. In case you don’t get a receipt confirming that the collector received your letter, you can track the letter via the USPS website.

What constitutes proper validation of a debt?

The FDCPA actually does not specify exactly what is considered adequate validation. If you were to sue the collector, or if the collector were to sue you, it would be up to the judge to decide what does and does not constitute ample validation. However, previous court cases have suggested that in order to properly validate, the collector should provide you with the following:

-proof of a contract between the collector and the original creditor to show that the collector is legally authorized to collect the debt from you
-a detailed accounting of how the debt was calculated (i.e. account statements from the original creditor)
-a copy of the contract between you and the original creditor, with your signature on it

What if the collector doesn’t respond to your request?

That’s fine, as long as they cease collection activity, and delete any listings of the debt that they have placed on your credit reports if they fail to validate within 30 days of receiving your request. If they do not comply with those requirements, they are in violation of the FDCPA and you can sue them for $1000. If you’re not especially eager to sue, you can send them a letter first warning them that they are in violation and that if they don’t straighten up, you will be forced to report them to the Federal Trade Commission (FTC) and possibly sue them. Chances are, you won’t need to pursue the issue any further than that. (If the debt is still listed on your credit reports, be sure to dispute it with the credit bureaus in addition to contacting the collector).

What if the collector’s response is not sufficient to meet the requirements of proper validation?

If this is the case, and the collector continues collection activity they are violation of the FDCPA. If they continue to report the debt to the credit reporting agencies, they are in violation of both the FDCPA and the FCRA. You should notify them in writing that their response did not constitute adequate debt validation, and that they are now in violation of the laws. For FDCPA violations, you can sue them for up to $1000 total, and for FCRA violations, you can sue for $1000 per violation.

If they are listing the debt on your credit reports, you should also dispute the listing with the credit bureaus. It may be helpful to send them copies of the correspondence between you and the collector to prove that you requested validation and the collector failed to comply. If the credit reporting agency contacts the collector regarding the listing, and the collector verifies the debt as accurate, they will again be in violation of the law for verifying a debt that they cannot or will not validate.

**A word of caution

A collector cannot sue you in response to a validation request without validating the debt. If they do, they are in violation of the FDCPA. However, be advised that if a collector does provide validation, they could then file suit against you. So it’s wise to use good judgment about requesting validation for debts that you know to be legitimate and that you could not afford to pay should they be validated.

As you can see, debt validation can be a useful weapon against collection agencies and junk debt buyers. I hope this article has helped you understand the concept of debt validation and how and when to use it; if you have any questions please feel free to leave a comment!