Letters to Send to a Collection Agency

Using Legal Rights to End Harassment and Fix Credit Scores

Dec 11, 2009 Candice Gillingwater

Sending the right letters to a collection agency will force it to abide by federal law and end harassment. In some cases, a consumer may also fix his credit scores.

Collection agencies often employ abusive debt collection methods in order to successfully collect debt from consumers. Individuals, however, have a legal right to fair debt collection practices. When an individual notifies a debt collector in writing that he is aware of his legal rights, he can end harassment from the collection agency and sometimes even fix his credit score.

The Debt Validation Letter/Dispute Letter

Section 809 of The Fair Debt Collection Practices Act grants every individual the legal right to be shown proof of the debt he supposedly owes to a debt collector and dispute a debt. This is done by using a debt validation letter, often referred to as a “dispute letter”.

A debt validation letter notifies the debt collector that the consumer wishes to be shown written proof of the debt and will usually include a request for the name of the original creditor of the debt. A debt validation letter can also request proof that the collection agency in question has been designated by the original creditor to collect the debt.

Debt validation letters are often used as a credit repair tool since the FDCPA states that if a debt collector cannot verify a debt, it must relinquish its claim on the debt and remove all evidence of the amount owed from the consumer’s credit report (See What is a Legitimate Debt Validation?)

The Cease and Desist Letter

Very little in life is more annoying than persistent telephone calls from collection agencies. Consumers who are plagued by debt collectors calling constantly can end the harassment by sending a formal cease and desist letter to the collection agency forbidding it from contacting them further.

A cease and desist letter is tricky. Should the statute of limitations on the original debt still be in effect, the collection agency will have no option to collect the debt other than filing a lawsuit against the consumer. Individuals for whom the state statute of limitations is still active can opt to send a limited cease and desist letter (See The Statute of Limitations on Debt Collection). A limited cease and desist letter forbids the collection agency from calling the consumer, but permits communication via mail. Not only does this end the stress of constant calls, but it provides a paper trail for any harassment or abusive practices for which the individual may opt to sue.

Threaten to Sue a Collection Agency

A collection agency must abide by all of the provisions of the FDCPA or risk a lawsuit from the consumer. Many collection agencies will ignore these rules due to the fact that the FDCPA limit’s the amount of money a consumer may collect for violations to $1000. This is an amount that most collection departments would scoff at, and so the harassment continues.

The benefit of a lawsuit to a consumer, however, is that, should the consumer win (and they often do), all evidence of the debt will subsequently be removed from their credit reports.

An individual should only threaten to sue a collection agency if he legitimately intends to do so. A letter that threatens to file a lawsuit should outline the FDCPA violations that the company has committed and also demonstrate the consumer’s possession of proof of the violations (See Illegal Debt Collection Methods). After making his position clear, an individual can go on to state that he will opt not to file a lawsuit if the collection agency will clear the debt from his credit record.

Tips on Sending Letters to Collection Agencies

A few things to remember when communicating with a collection agency via mail:

• Use an original letter. Debt collectors are well accustomed to receiving forms printed off the internet from consumers. All a form letter says to a collection agency is that the individual is not familiar enough with his legal rights to construct his own letter. Original, typed letters are taken much more seriously.
• Be professional – A consumer who writes an angry and abusive letter to a debt collector leaves behind written proof of abuse that can be used against him should he ever attempt to file a lawsuit.
• Consider getting the letter drafted by an attorney – Many attorneys will draft a letter to a collection agency for a customer for as little as $30. Different attorneys set different prices for this service, but the cost is more than worth it just to have the attorney’s letterhead. Letters from attorneys are taken very seriously by collectors – more so than those drafted and sent by consumers themselves.

All individuals should also remember that following the laws is not optional. The guidelines in the FDCPA are set in stone, but a collection agency will attempt to convince a consumer otherwise. Being well-informed is a must. An individual who is aware of his legal rights is in much better standing when dealing with debt collectors.

Read more at Suite101: Letters to Send to a Collection Agency: Using Legal Rights to End Harassment and Fix Credit Scores | Suite101.com

Lori Cain, Realtor

Chinowth & Cohen Realtors

phone: 918.852.5036

web: www.LoriCain.com