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Debt Self-Help Center

By Brad Stroh Jun 08, 2013
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Do It Yourself
HIGHLIGHTS
  • Pull your credit report regularly to identify any errors.
  • Dispute an inaccurate debt amount with a debt dispute letter.
  • Stop collection calls with a cease and desist letter.

Tools & Knowledge to Get Debt-Free on Your Own

This free Debt Portal has been created to help you solve debt problems, from validation letters to credit repair forms. Bills.com’s “Debt Do It Yourself Center” will put you in the driver’s seat to solve your debt problems on your own for free.

Disputing a Debt with a Collector

Under Federal law, you have the right to request documentation proving that you actually owe the debt being claimed by a collector. If you have any doubts as to the validity of a debt being asked to pay, you can dispute the debt in writing (this process is also called “requesting validation”). Once you have notified the collection agency of your dispute, it is required to cease all collection activity until it has responded to your request by providing documentary evidence, such as a signed credit agreement, demonstrating that you are the person who is responsible for the debt. Below are three letters which you can use to help you in disputing your debt with a collection agency.

Debt Dispute Letter

Do It Yourself Debt Help

If you receive a call or letter from a collection agency for a debt that you don’t think you owe, you can send the agency this letter to put it on notice that you dispute the validity of the debt and that you are demanding that the agency provide proof that you are responsible for paying it.

DIY Debt Dispute Letter

Notice of Insufficient Validation

Frequently, collectors will respond to a request for validation with nothing more than a computer printout of the balance owed. Generally speaking, this is not sufficient proof of the debt. If you receive a response to the first letter which you think is insufficient, you can use this letter to put the creditor on notice that it has not satisfied its obligations to provide proof of the debt.

DIY: Notice of Insufficient Validation Letter

Failure to Validate Debt

If you do not receive a response to your debt dispute letter within a reasonable time (usually 30-60 days), or if the creditor continues its collection efforts without validating the debt, you can use this letter to notify the collector that it is legally required to stop its collection activity against you. Having sent the debt dispute, and following up with this letter, may put you in a better position if the creditor refuses to stop its collection efforts and you are forced to file a complaint with the FTC, your state Attorney General’s office, or even to file a lawsuit against the collector for violation of the Fair Debt Collections Practices Act (FDCPA).

DIY Debt Letter: Failure to Validate Debt

Cease and Desist (C&D) Letters

These are letters which you can use if you wish to stop a debt collector from calling you. The first thing to remember is that the federal law (FDCPA) which requires debt collectors to stop calling you if you make such a request in writing, only applies to third-party debt collectors. (Some states have their own version of the FDCPA, which could extend stronger protections than the federal version.) If you owe money to CitiBank, and CitiBank is calling you directly, this letter may not be able to stop those calls. However, some states have passed laws that extend these federal protections to creditors. Also, many creditors will abide by such requests, not because they are legally required to do so in all states, but because they do not want to violate the law in error and want to maintain a positive public image.

Cease Communication Notice

The Cease Communication Demand letter is a more general letter, designed to stop all collection calls.

Do It Yourself Letter: Cease Communication Notice

Work Harassment Letter

This letter is specifically targeted to collectors who are calling you at work, which are a particular problem, as some collectors will make multiple calls to a consumer’s workplace in an effort to shame or irritate the consumer into paying the debt. I recommend that you use these letters sparingly and only when needed; there is no need to send a cease communication demand to every collector who calls, but you should know that you have this option if a collector’s calls become harassing or abusive.

DIY Work Harassment Letter

Credit Repair – Dispute Listing

We strongly encourage consumers to pull a copy of their credit reports from all three major U.S. credit bureaus — Equifax, Experian, and TransUnion — at least once each year. It is important that you review your credit reports on a regular basis, as credit reports are notoriously inaccurate and often contain derogatory information about accounts that you never opened. This erroneous information can cost you thousands of dollars in the form of higher interest rates and reduced access to lower cost forms of credit. Reviewing your reports will also help you find out if you have been the victim of identity theft, as you will be able to see if any large credit transactions have taken place about which you were unaware. If you find any erroneous information on your credit reports, you have the right under federal law (the Fair Credit Reporting Act) to dispute the debt. You may order copies of your credit reports, free of charge, through AnnualCreditReport.com.

DIY Debt Help: Credit Repair: Dispute Listing

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Comments (143)


Eric H.
Crest Hill, IL  |  June 08, 2013
I have accounts in collection from medical bills, unfortunately there are 4 instances where i had to use the ER. Time passed and I failed to pay my bills and they were turned over to collections. The problem I am having is the the Collection Agency (MEDICAL BUSINESS BUREAU) took each instance and broke it up into 3 separate accounts, one bill totaled $1300 but they turned in to 3 accounts for $50, $477, and $477. Is this a common practice for collectors? Is there anything I can do about this and have only 4 open accounts instead of 12?
Bills.com
June 11, 2013
What you described is a violation of the Fair Credit Reporting Act. Take these three actions:
  • File disputes with each of the three consumer credit reporting agencies that report this error.
  • File a complaint with the Federal Trade Commission
  • File a complaint with your state's attorney general.

See this Bills.com table for a list of attorneys general to learn the Web pages where you can enter your complaint about the collection agent.

Robert F.
Macon, GA  |  March 11, 2013
Can a Debt Collection agency hold and refuse to cash checks? Can they refuse to show us their policy on payments? My wife has a small debt less than $500 in collections that she has been paying on, but her hours at work have been cut. She was working 160 hours a month and now she works around 70 hours a month. She was paying $50 a month now she is is sending them $10 a month.

The Collection agency is holding her checks for January and February because they say the amounts do not meet their policy for minimum payments. The Collection agency called back within five minutes -- it was a different lady this time. My wife asked for a copy of the policy on minimum payments and told there was no policy and they do not have a payment plan (My wife was making payments last year and they cashed the checks), and demanded that my wife come in to the office and pick up the two checks she sent them and pay the full amount right now!
Bills.com
March 11, 2013
Read the Bills.com resource, If I Pay a Small Amount on My Debt, Can I Be Sued? to learn the basic rules for the type of situation you described.

If your wife has a contract with the collection agent to pay $50 per month, and then later starts making smaller payments, she is in default of her contract with the collection agent. At that point, the collection agent can refuse to accept the payment, and demand she pay-off the debt immediately.

However, if she made no promise, in other words formed no contract with the collection agent, then she is not in violation of any contract with the collection agent. You wife should consult with a lawyer who has consumer law experience in her state of residence to learn more about her rights and liabilities. If she cannot afford a lawyer, call your county bar association to learn the names of organizations in your area that provide no-cost legal advice to people with low and no income. Make an appointment with one of these organizations, and bring all of the documents you can find regarding the debt. The lawyer your wife meets with will explain her rights, liabilities, and options.
Shika H.
Red Oak, TX  |  March 04, 2013
This informatio​n is wonderful and I will further educate myself on this website for the purpose of cleaning my credit. However, I have a few questions; should a collection agency provide all of the documentat​ion requested using these letters, what steps would I take next to get the debt off of my report? Also, can these letters be used for judgment debts or is there a different process for this type of debt? I have received some medical bills; however, they do not show up on my credit report, but I am receiving bills from collection agencies. Would I use these letters for this type of debt as well? What do I do if after I have sent the Harassment Letter to the collection agencies and I am still receiving these calls routinely? If the collection agency does not respond to any of these letters that I send, how do I go about the process of reporting by way of the Fair Credit Act and getting in touch of my Attorney General's Office to begin litigation​? Thanks in advance for your guidance!
Bills.com
March 05, 2013
Under the Fair Credit Reporting Act (FCRA), most accurate derogatory information may appear on a consumer's credit report for 7 years after the date of first delinquency, and some information can appear for a longer period of time. Bankruptcies, for example, can appear for 10 years. You mentioned a judgment. A judgment can appear for 7 years, or your state's statute of limitations for a judgment (and for any period for which it can legally be renewed), whichever is longer. See the hyperlink I mentioned in my first sentence here to learn more about your rights and liabilities under the FCRA.

Regarding the sample letters on the Bills.com Debt Do It Yourself page, they are general-purpose letters and can be used for judgments. Again, as mentioned, the consumer credit reporting agencies are not obligated to remove accurate derogatory notations from a consumer's credit report.

You mentioned debts that are not appearing on your credit reports. First, keep in mind there are three major consumer credit reporting agencies in the US — Equifax, Experian, and TransUnion — and the three may publish different information about you. One may publish Medical Debt A, but not B or C; the second may report Medical Debt B, but not A or C; and the third may report Medical Debt A, B and C. The appearance or non-appearance of a debt on one of your credit reports does not determine if you have legal liability for the debt. Think of Equifax, Experian, and TransUnion as specialized newspapers. An event appearing or not appearing in your local newspaper does not mean the event did or did not happen.

When an original creditor or collection agent contacts you to collect a delinquent debt, validate the debt immediately. Follow the instructions on the page I just mentioned to validate a debt properly. Consult with a lawyer in your state who has consumer law experience if you believe a collection agent has violated the FCRA or the Fair Debt Collection Practices Act. You do not need to file a complaint with your state attorney general before you file a lawsuit against a collection agent.

Find your state attorney general's complaint form by entering your state name and attorney general into your favorite search engine. All state attorney general Web sites have an online form or PDF you can download and print to file a complaint.
Anne B.
San Francisco, CA  |  February 28, 2013
I am in terrible financial trouble after being out of work sick for 1.5 years. I'm back at work however, in the interim I had neglected to pay one of my credit cards and after a short while forgot all about it! Eventually it was brought to my attention by a nasty collection agency who has sold the account/amount to another collection agency who is harassing my place of employment! The original amount was for $3,600 and now they are trying to collect $5,000! There seems to be no negotiating anything with these people. The bank/original credit card company has nothing to do with this since they sent it off to collections. I don't have the $5K and would be willing to make a payment arrangement but they will not hear of it! What should I do?
Bills.com
March 01, 2013
See the Bills.com article Debt Settlement Advice to learn tips and techniques for negotiating with a stubborn collection agent. Keep in mind that although the collection agent has the legal right to collect the face value of the debt, it bought your collection account for about 8 cents on the dollar. Here, that means it paid between $288 to $400 for your collection account. Even if it accepts $500 or $600 as a settlement offer from you, it's earning a healthy return on its investment.

If the collection agent continues negotiate hardball-style, then work with a debt settlement company or lawyer to negotiate on your behalf.
Jami A.
Orange Park, FL  |  January 29, 2013
I have a T-Mobile bill from when I was 20. I am now 32 and it recently has shown up on my credit report as a new debt. I thought the statue of limitations were up on this and it is now with a foreign third-party company, which was the one who reposted it. Is this legal? I thought it was illegal to repost something this old as a NEW debt?
Bills.com
January 29, 2013
A delinquency like the one you described may appear on a credit report for up to 7 years from the date of first delinquency. This rule is spelled out in a federal law called the Fair Credit Reporting Act. If, as you suggest, the date of first delinquency was 12 years ago, the collection agency is violating the FCRA by reporting the debt as current. File a dispute with each of the consumer credit reporting agencies that are publishing this error.
Sharon C.
Lehigh Acres, FL  |  January 28, 2013
I had two payday loans:
  • $200: I paid 6 payments of $79 and
  • $300: I paid 6 payments of $105

I have paid more than the first installment plus the 10% that Florida payday loan law requires but they refuse to stop taking payments out. The $200 loan has collected a total of $474 so far and the $300 one has collected $525. I just changed my checking account and know that now I will be receiving harassing phone calls. What is my next step?

Bills.com
January 29, 2013
Contact the Florida Attorney General and the Florida Office of Financial Regulation and file complaints with both offices. See the Bills.com resources Florida Payday Loans and Payday Loan Laws State By State to learn more, including contact information.
Dario A.
Miami, FL  |  November 14, 2012
I had Internet service and home phone service with ATT, which waved the cost of the modem and the activation fee. In addition, the cost of my home phone service without any features at all was about $12.00 per month. I changed the phone number because of too many harassing calls from salesmen. ATT agree it wouldn't charge me anything for the change. Then the next bill was for over $173.oo for the Internet service and over $41.00 for the phone servicee. i complained to ATT, but it wouldn't budge so I had both services disconnected. ATT gave the matter to a Collection Agency in retaliation asking for the $41.17 for changing my phone number, and I have been receiving letters from the Collection Agency demanding payment of the $41.17. I have not answered any of the letters. In contrast, ATT sent me, and my bank collected, a refund check. Any relief from the collection agency? Do you think that gigantic ATT would take me to court for such small amount? Your comments are greatly appreciated.
Bills.com
November 19, 2012
AT&T may not decide to file an action against you, but if AT&T sells your collection account to a collection agent, it's possible the collection agent may decide to do so. Your best course of action is to swallow your pride and pay AT&T the amount due before this dispute impacts your credit score negatively.
Vicki L.
Erie, PA  |  August 08, 2012
I had a payday loan back in 2007 and did not get paid at the specified time. Stopped payment due to no money and in the payday loan trap. OUCH-what a nightmare. Any way I did finally pay all back. And for one I received a settlement letter to pay 140.00 of 542 in March of 2010,so I did and never had another correspondence from them until Feb of this year a collection agency called me about it. I told them I did not pay but unfortunately I no longer had any proof,so I faxed them a letter requesting that they no longer call me but to send all correspondence through regular mail. Again I heard nothing until today I receive another call from another collection agency stating that I have 2 days to pay or they will submit to the courts. I found the date and letter of the settlement offer but I cannot find anything to prove I paid. I just thought was all settled because I never heard. I settled all of them. Do I have any leg to stand on here. It has not hit my credit report in any way -- that is another reason why I thought I settled. Please advise.
Bills.com
August 08, 2012
Contact your bank or credit union to see if it has a record of a payment to the collection agent that is near in time to your settlement agreement.
Daniel Y.
Brownsville, TX  |  July 05, 2012
I had a credit card back in 2006 with a limit of $200, and got closed on Nov-Dec 2006. My TransUnion credit report says it will be dropped on 2013, which is more or less 7 years from the date of first delinquency. The balance shown on the report is more than $1,000. Should I negotiate a "pay-for-delete" now? Also, a collection agency reports the same debt in a different amount, very different from the original $200, it says placed in collection in 01/2009, to be dropped on 08/2013. Is it OK for both to be on the report although both are the same debt?
Bills.com
July 05, 2012
A pay-for-delete has the most impact on your credit score when the collection account is relatively young. This is because recent delinquencies are weighed more heavily than delinquencies that are about to fall off a credit report.

It is common for one debt to appear several times on a credit report as the collection account is passed from creditor to creditor. This is not illegal under the Fair Credit Reporting Act. It should be, in my humble opinion, because this practice may mislead creditors who glance at a report and mistakenly conclude a consumer has a half-dozen or more delinquencies when it is really just one collection account that has passed through many hands.
Mike M.
Cambridge, MA  |  June 29, 2012
Hi: I recently sent a validation letter to a collections agency, and they didn't give me all the requested documentation to validate the debt. I then sent them a failure to validate debt letter (about a month ago). This charge just showed up on my credit report, and the agency says they will not remove it because they believe it is valid (again they haven't given me the documentation to prove it). What is the next step I should take? Should I file a complaint with FTC? Should I hire an attorney? Thank you very much for your help!
Bills.com
July 02, 2012
Please see the Bills.com resource Debt Validation, and specifically the section "What is Proper Validation?" to learn how little evidence US federal courts require creditors to present to consumers.

If the creditor did not meet the very low threshold of documentation necessary to validate the debt, filing a complaint with the FTC would be a good first step. The FTC may not provide you with any immediate relief, but if enough people file similar complaints about this collection agent, the FTC will launch an investigation.

A good second step is consulting with a lawyer in your state who has consumer law experience. He or she will review the facts, and advise you if you have a good cause of action against the creditor for violating the Fair Debt Collection Practices Act and the Fair Credit Reporting Act.
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