What Alabama Consumers Should Do When Contacted By A Collection Agency


We are often asked by Alabama consumers “What should I do when I first get contacted by a collection agency or debt collector?” and so we wanted to share some thoughts with you.

First, unless you know that the information is correct, you need to dispute the validity of the debt within 30 days. You can send a letter by certified mail, return receipt requested, that says something like this:

[Put the account number, your contact information, etc.]
Dear _____ I dispute that I owe this debt. Please explain why you believe I owe this money and the calculation of any money you claim I owe. Who is the original creditor? How did you get this debt?

You have my contact information so don’t call my work, my family, my neighbors or my co workers.

If you have put this account on my credit report, make sure it is marked as “disputed”.

Thank you for cooperating with me.

Make sure that all letters you send to the collector are sent by certified mail and that you keep a signed copy.

Second, save everything you receive from the collection agency. All letters, envelopes, voice mails, etc. Make notes of all calls you receive. Peter Barry is a great lawyer who represents consumers and he has prepared a form to record information about calls and letters- take a look at it here.

Third, pull your credit reports to see what the collection agency or debt collector has said about you on your credit reports. We suggest Alabama consumers do this for several reasons:

(1) If the debt collector has this account on your credit report, you want to make sure the collector has not “re-aged” the account. Negative accounts typically “fall off” your credit report about 7 years after you default on them. Collectors, particularly debt buyers, have a nasty habit of changing that date to show the account as being more recent so that it will stay on your credit report for longer.
(2) Sometimes you can tell when the default was (in case you have forgotten) as this can impact the statute of limitations.
(3) If the account has been sold to a debt buyer, then the original creditor’s account should show a zero balance and a notation that the account has been sold or transferred or purchased.
(4) After you have told the collector that you “dispute” the debt, then at least within 60 days this should be reflected on your credit report that the account is “disputed” by you.
(5) If there are errors on your credit report, then you can dispute those errors to the credit reporting agencies. (Click here for a recent verdict from California related to false entries on a credit report by a debt buyer).

The fourth step you should consider taking when contacted by a collector is to remain vigilant for any calls (which would violate your request for no more calls), letters (which may have false information in them), lawsuits (read about defending suits here), and listen carefully to your friends, family, neighbors, and co workers who may have been contacted (possibly in violation of the law) by the collectors. As we have pointed out elsewhere, please log in all of the calls and letters you receive by filling out the collection log by Peter Barry.

We will address in future posts about some factors to consider in whether to pay the collectors and how to pay them but for now these four steps will help you to protect yourself from collectors that might be violating the law.

Another resource for you is to join our Facebook Fan Page – Alabama Consumer Protection Attorneys where we share useful information about the same types of issues that we cover in this blog.

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