How can you prove a debt isn't yours?

Getting an unexpected letter from a debt collector can be a disconcerting experience. Here's how to handle it if you're not sure you owe the money.

By Credit.com Jun 18, 2014 11:29AM
This post comes from Gerri Detweiler at partner site Credit.com.

Credit.com on MSN MoneyGetting a letter from a debt collector can be disconcerting, especially if you were not aware of having debt. Your initial communication from the collector, called a demand letter, should contain information indicating how you can request more details.


Past Due Notice on Envelope © Stockbyte/Getty ImagesBy law, you may request that the debt collector validate the debt, and the collector must respond within five business days. (Requesting that is especially smart if you are worried that the debt collector is not legitimate; a legitimate collector will respond.) You can find more information about your rights from the Consumer Financial Protection Bureau.


Recently a reader with the handle "Sonnycam" wrote to ask us what sort of documents or other evidence would prove a debt is legitimate. Unfortunately, the answer is not simple.


Before you say, 'it can't be mine'

One uncomfortable truth is that debts you don't recognize are sometimes legitimate. That can be true if, for example, a store credit card is handled by an issuer with a different name. Another reason you might not recognize the account is because it was turned over to collections. Medical collection accounts in particular can be confusing because debt collectors must be sure they don't violate medical privacy laws. So if someone owes a cancer treatment center, for example, the collector can't reveal the name of the facility without potentially violating someone's right to medical privacy.


Joann Needleman, president of the National Association of Retail Collection Attorneys, says it's easier for collectors to validate debts (the word "validate" doesn't have a legal definition) if a collector knows precisely what a consumer's question is. Are you saying you don't think you're the John Doe the collection agency is looking for?  Are you saying the balance is wrong? Or that you want confirmation of payment? Or that you don't believe you incurred the debt?


If you are asking questions, it's best to give the collectors enough personal information (the last four digits of your Social Security number, for example) so they can be confident they are communicating with the right person -- because under the Fair Debt Collection Practices Act, it's a violation to provide debt information to a third party. Legitimate collectors should be complying with laws.


What to expect

As far as "proof" of a debt, "The barrier to validation is low . . . extremely low," says Michael Bovee, founder of the Consumer Recovery Network. "A statement or two, and a collector telling you who the bill was owed to and the amount, and many debt collectors are covered. There is a ton of terrible advice [about] what to ask for in a validation letter. The problem with this is people reading about it, and using the letters and verbiage, have, or are set up to have, unrealistic expectations," he wrote in an email.


Robert Hobbs, deputy director of the National Consumer Law Center, agrees that validation can be difficult because of the laws and because of individual situations. If you believe the collector is not behaving appropriately, you can submit a complaint to the Consumer Financial Protection Bureau. The bureau will log the report, and complaints require a response from collectors, he said.


Hobbs said if you believe a collector has violated your rights and you want to take legal action, it's best to contact a lawyer through the National Association of Consumer Advocates.  He said the vast majority of other lawyers are without expertise in this area. "Find someone who specializes in fair debt collection problems," he said. "They may say, 'that's interesting . . . you may have a case.' Or they may tell you that you don't." That way, you won't waste time and money you could use more productively elsewhere.


You can always try filing a complaint with the Consumer Financial Protection Bureau as well if you think the collector isn't providing you with enough information to determine the debt is yours or if the amount is correct.


Finally, if you're concerned about the effects a possible collection account could be having on your credit, it's a good idea to check it. You can pull your credit reports once a year for free from the three major credit-reporting agencies through AnnualCreditReport.com -- check them for past-due and collection accounts. You can check your credit scores for free through Credit.com, where your scores are updated monthly, along with an overview of your credit health and a plan to help you build your credit.


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27Comments
Jun 18, 2014 9:04PM
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The national debt is not my debt though I have to pay on it.  If a debt is mine, show me my signature.  The national debt is robbery of the American people.  I often wonder why more than 300 million Americans allow 535 crooks and a dictator to ruin us.  I doubt I will ever understand that.  Maybe when the 200 dollar oil gets here, people will rise up.
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just ask the US gov.... they are 17 trillion in debt and growing! get ready for hyper inflation, depression, and flying shi! after it hits the fan-
Jun 19, 2014 8:58AM
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I have had some of these clowns call me and say hey you owe us this followed by can you prove you paid it five years ago ? I just tell them no problem send me all the past billings proving you have tried to get me to pay it and I will issue you a check right away. This is followed by they did not give us that which in turn is followed by get it, send it, have a nice day and click. There are scams out there that target people with good credit since they know many will just pay it without question to keep it. Remember keep a eye on your credit score for inquiries and your hand on your wallet for thieves. 
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The American Government has the most debt in the world...............here at home, she beats down on those who have debt, can't pay it right away.....your pay will be docked, your taxes at the end of the month taken...........Such Hypocrisy this Government is built on........

Hypocrisy does not live long........it burns in lakes of Fire.....
Jun 19, 2014 9:14AM
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I know a 47 year old man with two bankruptcies and a foreclosure.  He's looking to get a mortgage with pretty bad credit.  What does he do?  He goes out and buys a brand new Dodge Ram truck with tinted windows and running boards, made possible by his brother's co-signature.  Oh, and this guy is white.
Jun 19, 2014 7:35AM
Jun 18, 2014 8:56PM
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THE ISSUE AT HAND IS THAT THE REPORTING AGENCIES GET PAID TO KEEP THE RECORDS--NONE SHOULD GET DINGED FOR A CHARGE NOT THEIRS--WHEN THE REPORTERS HAVE A DUTY TO VERIFY THE INFO THEY GET SINCE THEY ARE PAID TO DO IT. AS TO THE MEDICAL THING --WHY WOULD IT MATTER THAT THE COLLECTIONS PEOPLE DISCLOSE THE BILL ORIGINATOR? IF IT'S YOURS ITS NOT A PROBLEM.  GOT SUED ONCE---THE PLAINTIFFS LAWYER JUST OPENED THE PHONE BOOK AND GOT MY NAME SINCE I WAS THE FIRST LISTED--EVENTUALLY GOT MY NAME OFF SINCE I HAD NO CONNECTION TO ANY BUT HAVING THE SAME NAME. LEGALLY HAD I SAID SCREW IT --NOT ME-- AND NOT SHOWN UP --JUDGEMENT FOR THE OTHER GUYS REGARDLESS THAT I WAS THE WRONG ONE--BUNCH OF CRAP! SAME HERE THEY MUST PROVIDE WHO THE AGENCY IS COLLECTING FOR--THE FACT THAT THEY DO IT THIS WAY SHOWS THEY ARE NOT DOING THEIR JOB--GOT ANOTHER STORY ABOUT A COLLECTION CO COMING AFTER ME FOR MY "FATHERS" DEBT----12 YEARS AFTER HE DIED.--SAYING HE SKIPPED ON A CREDIT CARD OPENED AFTER DEATH---THEY COULDN'T EVEN NOTICE THAT THE NAMES WERE DIFFERENT A WE MINE VS WC NOT MINE--HAD TO WRITE A LETTER TO THE ILL AG TO GET IT TO STOP---


Jun 19, 2014 12:05PM
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TALK ABOUT DEBT!!!!!!!!!!!!!!!!!!!!!

"The fact that we are here today to debate raising America's debt limit is a sign of leadership failure. It is a sign that the US Government cannot pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government's reckless fiscal policies. Increasing America's debt weakens us domestically and internationally. Leadership means that, 'the buck stops here.' Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better."
   ~ Senator Barack H. Obama, March 2006


"PERIOD"

Jun 19, 2014 9:50AM
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The consumer protection laws on debt are a real problem when you are trying to help someone with their debt problems.  I tried to get settlements on several of my wife's debts only to be told I couldn't settle or discuss her debts.  Even after she sent letters to them giving me authority to act on her behalf, they still refused to work with me because of the consumer protection laws.  More government regulations run amuck.  
Jun 19, 2014 10:54AM
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Not your debt?  I've heard much better 'deadbeat' excuses than that.  It's your debt.  Just man up and admit it.
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