Debt Validation: Tool against Bill Collection Fraud
Activities involving money is always a sensitive matter. You have to be very careful with your actions and communications especially if you are the debtor. Debtors are figuratively and literally at the mercy of creditors. Thus it is important that every decision should be well-thought of; every action deliberate. You should also be familiar with the terms of agreement and others details regarding the debt. Being vigilant is specially needed in the debt payment processes.
In this article we will talk about debt validation, that is, how it function, the strategies involved and its legal basis. To exemplify the relevance of debt validation as an effective tool against bill collection fraud and other illegal acts, we will look into the concept using the scenario below.
Billy owes Alpha Omega Corporation (AOC) some money. One day a Joe comes up to Billy saying that AOC hired him to collect the money owed. Billy was skeptical and doubtful whether this Joe is telling the truth. Thus he then telephoned the creditor (AOC) to inquire about your debt statement and also asked whether Joe was indeed authorized to collect his debt. The AOC responded that they do not know any person called Joe. So to make the story short through debt validation, Billy was given the opportunity to question whoever the bill collector is, the amount he are suppose to pay and other matters.
According to the Fair Debt Collection Practices Act (FDCPA), consumers like Billy have the right to challenge a debt or written notice of debt by a bill collector. The debt collector should also provide sufficient verification materials to show that you really incurred such debt, of such amount, during such time. At the minimum, the collection agency should provide account statements from the original creditor. You could also test the knowledge of the bill collector by inquiring about the complete payment history of the debt.
One might ask what is the importance of debt validation and verification of the bill collector and creditors. If creditors are not able to verify a debt, they are not allowed to collect the “debt”; they should not contact you about the debt; they are also prohibited to report it.
But it seems that scammer collection agencies are joining the debt validation bandwagon. They try to sneak past the validation requests by sending summons to appear in court. It is significant to realize that collection agency cannot file a suit against a debtor if they have not validated the debt within the initial 30 day period.
