Sometimes, like Josh wrote last year, avoiding debt collectors and refusing to pay a debt really is the best case scenario. If that’s your situation, you’ll get no judgment from me. If you’re on the fence, though, I’m going to suggest something radical. I’m going to suggest that you actually answer the phone.
There are two reasons why:
Not all, but a lot of the collectors who call you are scammers. Seriously. They employ the same tactics as legit collectors (and often create fake debt collection companies so that their pulling of your report looks justified to the credit bureaus) but will get even more extreme with you because they want money. Catching them in the act is important because the last thing you need right now is to give your money to a thief! Plus, you’re helping to get a scammer off the streets (or phones).
Even if the company is on the up and up, a lot of the time they won’t be able to prove that you actually owe them this debt. If you can prove their error (or if they fail to prove their legitimacy), then you can have that debt completely erased from your credit report…before that pesky seven year waiting period has passed.
So how do you do this? How do you catch a scammer in his/her tracks? How do you convince a collection agency to prove that you owe what they say you owe and that you owe it to them?
1. Know exactly what is on your credit report.
If you aren’t sure about how to go about getting your reports or, more importantly, making sure they are accurate, work with a professional. There are credit repair agencies like Creditrepair.com (I mention this one because I like their YouTube videos) that exist solely to make sure that your credit report is as accurate as possible. Work with one to make sure that mistakes are fixed and that existing debts are verified. Even if your score makes you blush, you’ll be surprised by how much more confident knowing your score and history makes you feel.
2. Ask For Verification of the Debt
This is important: the caller, legit or not, is going to try to get around this. They are going to try to get you to say “I dispute this debt” on the recorded call because they want reason to, as they’ll say, “step up” their action against you. Whenever they ask “do you dispute this debt?” Say “I didn’t say that, I said I need you to send me written verification of both my debt and your purchase of the debt from the original creditor.” Say this even if you know you’ve paid the debt.
DO NOT AGREE TO PAY ANY MONEY ON THIS CALL. DO NOT SET UP A PAYMENT ARRANGEMENT. Just ask for written verification. A couple of things will happen.
1. The caller will refuse and say that they don’t have to do that. This person is a scammer. Ask for the company’s name and the caller’s name. They’ll likely refuse but ask anyway. Then hang up the phone and report the call for fraud.
2. The caller will agree and ask for your address. Don’t give this information out over the phone. At this point, the best thing to do is to day something along the lines of “you know what, I’d feel a lot better having a paper trail for this whole thing. I’m going to send you a written request for this verification. What address should that be mailed to?” Scammers will try to get around this or flat out refuse. See step one. A legitimate collector will be happy to provide the address. Write down the address and send the debt verification letter (or have your credit repair company send it on your behalf). If you get written verification of the debt, you’ll have a starting point to work from. If you don’t, you can report that to the credit agencies and have the account removed from your report.
A final note: collection agencies (the legitimate ones) really do want to work with you. Most are happy to set up payment plans and provide documentation that you paid your debt “as agreed.” Their calls might be annoying but if you know what your rights are and you know your credit score and history, there is no reason to be scared.