How to Talk to a Collection Agency
Collection agency calls are probably one of the most stressful calls you can receive. Most agencies engage in scare tactics and attempt to bully people into paying the balance that day, with threats of ruined credit. Often times, collection agencies will purchase debts in bulk, which results in duplicate requests for the same debt. Follow a few simple, albeit time consuming, steps to ensure the debt they are attempting to collect is legitimate.
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Instructions
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Verify who is collecting the debt. If it is "in house", such as the collection department for your credit card company, you may know that you are late. In this case offer to mail or electronically submit a payment immediately. If you are uncertain about your account status, request a copy of your current account statement be mailed and inform the agent that you will call back to make payment arrangements once you have received it. Document the date and time, the name of the individual you spoke with, account information, the payment arrangements and any other information that is relevant to the call.
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Document the company. If the company is not "in house", a hired collection agency which has purchased your debt, request complete information on their company. Document their full company name (do not accept an acronym), contact name and phone number with extension and correspondence address.
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Verify the debt. Before moving forward with any discussion of payment, request the information of the company that sold them the debt. Document what you are told.
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Demand a copy of all records. Verify the address they have on file for you, and instruct them to mail you a copy of all records pertaining to the account. Many collection agencies will tell you that a statement has been mailed. Do not accept this. Insist upon receiving full documentation of the account, including original account statements and the dates of the debt sale.
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Do not discuss payments. Until you have received full documentation proving this is a legitimate debt, do not discuss payment arrangements or terms. Inform the agent that you will be in contact with them once you have received the requested documentation.
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Write down the phone number. Use your caller ID or a *69 service to record the number they called from. Add this to your documentation.
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Send the written request. Most, but not all, companies will require a written request for full documentation. Mail this as soon as possible. There are many copies of these verification letters, available for free, online. Retain a copy of the letter, for your records, and mail it registered mail with a delivery confirmation. For your records, you may, in the letter, request a call from an agent when the request is received, however, they may not comply.
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Wait for your documentation. Federal law states that they must provide full documentation of the debt within 30 days of your written request. If they have not provided this information, they cannot legally collect the debt. They may attempt to take you to court.
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Examine the documentation. Call the original debtor to ensure the debt has not been previously paid. The collection agency may only provide documentation from the most recent sale, if they purchased the debt from another agency. This is not proper documentation to collect a debt, and you must continue to demand original documentation.
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Work out a payment plan or dispute the debt. If the debt is legitimate, call the number listed on the documentation and schedule a payment plan. Do not agree to any auto debit arrangements. If the debt is invalid, call the company and inform them it isn't a legal debt under Federal law. They may attempt to take you to court.
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Tips & Warnings
Study the Fair Debt Collection Practices Act to learn what the collection agency can (or cannot) and must do to legally collect a debt.
You do not need to "lawyer up" to dispute your debt in court. If you feel the debt is large enough to warrant it, though, go ahead.
Never provide payment information to someone who calls you, regardless of the debt's legitimacy, to prevent identity theft. Any payments should be made electronically, through the company's website, or via a mailed check.
Never agree to an auto debit arrangement. Collection company's may attempt to take more than you agreed upon, in which case you will need to enter a drawn out legal battle.
