Before You Pay That Debt, Validate It

There are few things in life as scary as getting a debt collection notice. Indeed, getting a phone call or letter from a collection company can be quite unnerving. For many people, the instinct is to pay it immediately (if possible) and move on. However, before you start giving out personal and payment information, take a deep breath. Did you already pay off the debt? Do you actually owe the money? Can you afford to pay it right now?

A good way to start straightening everything out, and to make sure that you actually owe the debt, is to get a debt validation. You are entitled to debt validation under the Fair Debt Collection Practices Act (FDCPA). This means that the debt collector is required to provide you with documentation of the debt. When requesting your debt validation (which is also a debt disputation letter), Craig at Bargaineering suggests you include these things:

1. Your name
2. The date
3. The fact that you are disputing the debt, and that you want to see validation

That’s it. Craig insists that signing the letter is a bad idea, since with technology now it is fairly easy for unscrupulous debt collectors to take your signature, scan it and then affix it to something you didn’t sign. He points out that the FDCPA doesn’t require it, so don’t sign it. You should also send the letter using certified mail. It costs a little bit, but it’s a small price to pay in order to prove that the debt collector received the letter.

In the end, it is vital that you know your rights; not understanding your rights could prove detrimental to your finances — just as detrimental as being in debt.

Image source: quaziefoto via Flickr