What is a Disputed Debt?

General Definition: A disputed debt is one that you argue does not belong to you or is for the wrong amount.

The debt collection process does not always go smoothly. Sometimes a collection agency contacts you about a debt that is not yours. Or, you may receive communication about a debt you owe but the amount owed is higher than you remembered.

Often this is an honest mistake by a collection agency. However, sometimes it is intentional. Regardless of the reason, you can always dispute the validity of a debt. When you do this a collection agency has certain requirements under the Fair Debt Collection Practices Act (FDCPA).

In this article you will learn about how to dispute a debt and what a collection agency must do in response. If a collection agency fails to address the debt properly you have additional protections under the FDCPA.

When Can I Dispute a Debt?

You can dispute a debt at any time. As soon as you recognize a debt does not belong to you, you should dispute it with the collection agency. The same applies if the debt is for the wrong amount or contains incorrect information.

Ideally, you will want to dispute the debt as early as possible. Under the FDCPA you should dispute the debt within 30 days of receiving a validation notice. A collection agency must send a validation notice within 5 days of their first contact with you. The validation notice will contain important information to help you confirm whether the debt belongs to you.

How Do I Dispute a Debt?

The best way to dispute a debt is in writing. You will also want to send this written dispute by certified mail. This provides documented proof of when you disputed the debt and that the debt collector received it. As previously stated, you should dispute the debt within 30 days of receiving the validation notice.

So if I dispute a debt after 30 days of receiving notice of the debt I have no rights? No. You can still dispute a debt after 30 days. However, disputing within 30 days of receiving the validation notice provides the additional benefits identified below.

Once you timely dispute a debt a collection agency has two immediate responsibilities. First, they must stop all collection activities. Second, they must provide proof that the debt is yours. This may be a previous statement with the creditor or the original agreement.

When a collection agency provides proof of your debt, they can resume collection activities. However, you can still dispute the debt. You can do this in writing or by taking any of the actions described in the next section.

Is there anything else I should do when disputing a debt? Consider checking to see whether your credit report contains the debt in question. If so, you may also want to dispute your debt with any credit reporting company listing the debt.

Note: The requirements for disputing a debt under the FDCPA only apply to third-party debt collectors.

What Should I Do If a Collection Agency Continues Collection Efforts on a Disputed Debt?

You may have properly disputed a debt. However, a collection agency continues to harass you without providing proof of your debt. If a collection agency continues efforts to collect on this debt, consider taking the following action:

Conclusion

Never pay a debt that does not belong to you or is for the wrong amount. It is important to dispute the debt and, ideally, as soon as possible.

If a debt collector ignores your dispute and continues to violate the FDCPA, you must hold them accountable. If you are unsure what next steps to take, contact a consumer rights attorney. They can help you resolve a dispute with a collection agency.

Additional Resources

• Getting Collection Calls for Someone Else’s Debt
• Can I Sue for Wrongful Debt Collection?