Getting the Collection Letter

Getting a collection letter is a drag. But it also presents the prospect of putting an end to the dunning as well as the subsequent reporting that inevitably follows. There are a number of credit repair tools you can employ when confronted by a collection letter, so take a deep breath and open the darn envelope.

Collections That Are All Wrong

It is not unusual for collectors to pursue erroneous collections, entirely erroneous, as in belonging to another person, or having been previously paid or otherwise resolved. This is the result of the barely-accurate skip trace methods used by collectors or their contractors, combined with the ease at which data files can be mixed up when there are a bare minimum of common identifying characteristics.

The Case of Antiquated Debt

In addition, the subject debt may be ancient, past the statute of limitation and often past the reporting period limit. All of these cases present an excellent opportunity for credit repair. Never take for granted the veracity of a collection letter. Open it, read it, study it. Figure your original default date, look up your statute of limitation, calculate your reporting period limit, and get ready to put some credit repair techniques to work.

Preempting Credit Report Damage

If the collection is simply not yours you better contact the collector right away and let them know. This is the easiest credit repair response. If you fail to do this you risk the bogus debt appearing on your report and entangling itself further in your life. No point to that. If the collector is obnoxious you can push your case with debt validation.

On Time Validation

Debt validation is your right to demand documentation of a collection within 30 days of getting a dunning letter. The collector must respond with proof of their legal right to collect and some accounting of the amount demanded. If they are not able to provide the documents asked for they must put an end to their collection efforts. If the account is not yours you should mention this in your validation letter.

Late Validation Techniques

Validation is a very handy credit repair tool, but must be done within the 30 days allowed. If the time limit has passed and you did not get your validation letter out, do not fret, there is still a way. Usually collectors will attempt to escalate their dunning effort once the validation period is over, and this is normally via phone call. If you get a call try this tactic. Tell the collector that you never speak about your personal finances with strangers on the phone, but if they will kindly send you something in writing you will look into it. When you get the letter you have 30 days anew to send your validation letter.

Negotiating With Leverage

If after examining the collection letter you see that it is yours, but it is past the statute of limitation you have an amazing negotiation opportunity. If you let the collector know that you are aware of the law and that they no longer have any legal leverage, they should be eager to settle. If they are smart they also know that you could even send them a cease communication letter and they would get a big fat nothing. Here is another cool credit repair trick. If they decide to play hardball, go right ahead and send the cease communication letter, and then call them about a week later, confirm their receipt of the letter and then open your negotiation again. Good luck!

Copyright © 2010 Ian Webber. All Content. All Rights Reserved.