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How To Ensure A Debt Collection Is Legitimate

By Author: Richard McLean
Total Articles: 2

Your phone rings. Someone on the other end is claiming to
work for a collection agency of some kind. He tells you that the purpose of
this call is to collect a debt. A debt which is so old that you thought it was
gone or you either do not remember owing. This is legitimately collectible or
not how do you ensure?

The caller must identify who he is and who he works for. Legitimate
debt collectors in Australia will supply a phone number,
business name and mailing address. A scammer will fudge around this or claim he
does not have to supply this information.

The majority of collection agencies will send you a letter
prior to calling you. Federal law requires them to send you a letter about the
debt no later than five days after their first contact with you. Eliminates the
surprise to you when they call and they are following the law is ensured by
sending the letter.

To have the collection agency verify the debt you have the
right. With return receipt so you have proof they received the letter you send
the letter via certified mail and you must do this in writing. A sample letter
from the Consumer Financial Protection Bureau can be found at

Though there is no federal definition of what constitutes
debt verification, the assumption is that if they can prove to a judge that you
owe the debt, then that is acceptable verification. So you should receive one
or more of these items:

A copy of the original, signed contract
A copy of the charge-off statement from the
original creditor
A copy of at least one cancelled check paid from
you to the original creditor
With the debt information from the creditor that
ties you (an account number, the creditor's name, the last four digits of your
social security number, the charged off amount and the current balance)

The collection agency has thirty days to supply this
verification to you. During debt collection in NSW, the
collection agency cannot attempt to collect this debt in any manner and they
cannot report this debt to the credit bureaus (note the original creditor can
still report it).

Some things you
should do during this thirty day period

Check your credit report to make sure the debt is truly
yours. The original creditor will report this as "Charged Off" if it
has been transferred or sold to a collection agency. You may also determine the
debt is too old under your state's statute of limitations for the collector to
sue you.

To determine who they sold the debt to contact the original
creditor. They can tell you this information. To learn who the actual owner is you
will have to follow the "chain of title" if the debt has been sold
numerous times. And the chances of this collection agency being able to verify
the debt drop dramatically if it has been sold numerous times.

The debt is uncollectible if the verification cannot be
supplied to you within the thirty days. But, the collection agency will add
this to your credit report and the debt is collectible if they do verify it.

Do not spend time on the phone with the debt collector if
you have any questions about this debt not being yours. Any hint of
acknowledging the debt is yours is not to be given by you. Confirm the mailing
address to send it to and politely end the call after just telling the
collector that you will be sending a verification request. 

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