Debt validation process – Be sure to know who you owe
Due to the enormous credit crisis happening not only in the U.S. but the world as well a lot of people aren’t aware of their rights when it comes to debt valuation adjustment. With so much debt on peoples shoulders and the willingness to get their selves out of debt there are companies floating about that misrepresent themselves as debt collectors.
The consumer has a right to request legal documentation of whatever debt is owed to a creditor. Most individuals are only aware they owe so when a third party collection agency contacts debtor with a monetary figure most consumers will believe that this is what they truly owe. Not true. It is important that consumers know exactly who and more importantly exactly what they owe. As most could probably guess debtors are over paying because a third party collection agency told them they owe the principle, interests and late fees. Or, the worst case scenario of all, you are steady making payments to this collection agency and they aren’t even affiliated with the true creditor. So basically you are giving your money away.
Under the FDPCA, (Fair Debt Collection Practices Act) the collection agency contacting you must provide legal documentation of the debt as well as legal documentation that they have bought the debt from the creditor. If no information has been sent to the debtor within 30 days they’ve violated the FCRA or Fair Credit Report Act. Because of this violation the debtor is within his/her rights to sue the collection agency under this act for damages up to $1000. You may also be able to sue them in state and federal courts for the incident and damages too.
So before you agree to pay some collection agency money for a debt you would be wise to investigate and ask for specific information pertaining to your debt, how they acquired your debt and you may want to find out about their business as well. For all you know they may not even be licensed in your state to bother you about collecting debt you owe to someone else.