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What to do first
If you’re contacted by a collector, the first thing you should do is check your credit report to see if the debt you're being harassed over shows up as "charged off." If so you do not owe the debt collector one single penny. However, if the debt is legitimate then people do have the right to try to collect on it.
Debt collectors have thick skins
The first thing you need to understand about a debt collector is that he is a third-party who works for a collection agency.. This is not the company that originally held your debt. Debt collectors generally have a quota and get paid on commission. This means they earn very little unless they can pry money out of you.
This can mean nothing
You might receive a call from a debt collector who says you owe money but you may not. The F Fair Debt Collections Practices Act sets down rules that debt collectors are required to follow. For example, you can dispute the legality of the debt. You can dispute the interest being charged, fees and penalties and the original balance. In many cases, the debt has been resold several times so how are you to know that you actually owe something?
How to get a debt validated
When you first get a notice from a debt collector or a phone call, tell him that you want your debt validated. You will have 30 days from the time you were first contacted by the collector to dispute the validity of the debt. If you don't, then the debt collector will assume the debt is valid. In other words, when you're contacted about the debt you must request validation. To have the debt validated, you can ask to see copies of the original contract, along with documents showing the last payments posted and any fees or penalties that were added.
What happens if the collector cannot validate your debt
If the collector cannot verify the validity of your debt, you may not have to pay it. You also may not have to have that debt on your credit record. If the collector bought a legitimate debt it should have documentation from the original source validating the debt.
Some of your other rights
According to the Fair Debt Collection Practices Act (FDCPA), collectors are not to call you at work or at home or flood your mailbox with notices. In the event that an unscrupulous debt collector is harassing you, you can send a cease and desist letter. You would tell them in that letter that you do not want to be contacted anymore either by phone or mail. Be sure to send the letter registered and return receipt requested so you can prove the agency received it. Collection agencies are required to abide by this request. If not, you can sue it.
One last contact
The FDCPA mandates that once a collection agency receives your letter, all it can do is contact you one final time to tell you that it is planning to file suit against you. In the event that this occurs, you'll need to use some common sense and weigh things before panicking. For example, is the debt big enough that the collection agency would actually file suit? The answer is that if it's less than $500, it probably won't.
You could negotiate
You also have the right to try to negotiate the debt. If the debt collector is having a slow month, he might be willing to settle the debt for less than you owe – and maybe for much less. In this case, timing is critical. This is because debt collectors are more likely to agree to settle with you towards the end of the month. If the collector does agree to settle, be sure to get it in writing. Never take the collector's word for it. Get everything in writing before you agree to anything,