There is nothing fun about finding a collection letter in your mailbox. But it may represent a great credit repair opportunity.
Credit Repair and the FDCPA
Collectors are governed by the Fair Debt Collection Practices Act (FDCPA). Under the FDCPA you have thirty days after receiving a collection letter to validate the debt. Specifically this means that you have the right to request that the collector provide documentation that they have the legal right to collect the subject debt. In addition you have the right to ask for an accounting of the amount they say you owe. If they cannot provide the documentation you request they must cease reporting and stop collection efforts. A pleasant credit report repair outcome!
Your Statute of Limitation
In the case that they do validate the debt, and after reviewing all of the documentation they provide you agree that the debt is valid, it’s time to research the statute of limitation (SOL) on the debt. Understanding the SOL is an essential part of every credit repair effort. The SOL is the length of time that a collector can enforce a debt through the court system.
Know Your Options
If an account has aged beyond the SOL there are two important considerations. First, since they cannot sue you they should be very open to negotiating the payoff. And second, if you want to end their presence in your life you may send a cease communication letter and you won’t hear from them again. If a collector does sue you after the expiration of the SOL you must show up in court and state your SOL defense, but you will prevail.
A Little Detail
Statutes of limitation are debt-type and state specific and can easily be found on the Internet. It is important to know that collectors can apply the state SOL that is most advantageous to them, the SOL for the state that you entered into the contract, or the SOL for the state if your current residence. So it is important to your credit repair success to check both!
Just Leave it To Us
And, of course, if you are a member of our credit repair service we will take care of all of this on your behalf. Just send us a copy of the collection letter as soon as you receive it and let us do the rest!