When it comes to collections, you have a very important right as outlined in the Fair Debt Collection Practices Act: The right to have a collection account "validated."
This process, as outlined in the FDCPA, is quite different from the "verification" process referred to above. When a credit bureau asks a creditor to "verify" information, the investigation that follows can be pretty cursory. The creditor reviews its records and any information supplied by the consumer and then decides whether it (the creditor) was right or wrong.
When a collection agency is asked to validate a debt, by contrast, the process can get pretty involved. The collector must prove that the debt is your responsibility, and also that they have the legal right to collect it from you. Furthermore, the collector has to cease all collection activity until they provide this evidence to you. If the agency can't validate the debt, it must end its attempts to collect on the debt and stop reporting the collections account to the credit bureaus.
Note that your right to validation applies specifically to collection agencies, not to the original creditor. Collection agency records are presumed to be less reliable than those kept by the original creditors. Collectors are often guilty of going after the wrong people or misstating the amounts owed; the validation process is meant to protect consumers from those practices.
To validate a debt, the collector needs to present documentation - obtained from the original creditor - proving that you do indeed owe the money. Validation can be a powerful weapon in your fight to clean up collection actions on your credit report. Many times collectors don't have the documentation required, especially if the debt has been passed around from one collection agency to another, as often happens. Frequently, they have little more than a computer printout to back up their claims, and the Federal Trade Commission has made it clear that such a "mere itemization" isn't sufficient proof to constitute a validation of a debt.
The validation process can not only help you eliminate collection accounts that don't belong to you, but it might help you get rid of some that actually do. That last statement might surprise you, particularly if you've heard the credit bureau company line that you can't legally remove true, negative information from your credit report.
You will find that sometimes - not always, but sometimes - you can get accurate information removed from your file, especially if it has to do with an old collection account. Now, the bureaus and Fair Isaac will tell you that this isn't "playing fair" - that the integrity of the credit system depends on credit reports reflecting the most complete picture possible, including all available negative and positive information.
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