I do a lot of trials in debt collection cases against debt buyers such as Midland Funding, Encore Capital, Portfolio Recovery, and Calvary SPV. A common tactic of these debt buying companies at trial is to bring up the issue that the defendant (you) never objected to the balance that they are claiming is owed, and thus because you didn’t object you must have agreed with it.
While this makes no sense, sometimes courts will buy into it and it can harm your case. You can remedy this by making the debt collector validate the debt they are trying to collect from you.
Federal Law Requires that the Debt Collector Validate the Debt
The Fair Debt Collection Practices Act (FDCPA) requires debt collectors to inform you that you have the right to make them validate the debt within five (5) days of their initial communication with you. The initial communication is usually a letter that they send you.
The debt collector then has thirty (30) days to send you information that contains the following:
The amount of the debt
The name of the creditor to whom the debt is owed
The name and address of the original creditor
Notify you of your right to dispute the debt
Also, the debt collector must stop all collections against you while they the debt is being validated.
Reasons to Validate a Debt
There are several reasons to make the debt collector validate the debt. First, junk debt buyers like Midland Funding purchase portfolios of accounts that number in the thousands. I have had several cases where the debt buyer is suing the wrong person and/or where there have been clear indicators of identify theft. By making the debt buyer validate the debt you will be able to get the information you need to determine if the debt is valid and if the amount they are seeking is accurate.
Second, the debt buyers themselves often don’t know the exact amount owed. By validating the debt you can then dispute the debt and you have tied them down to a specific amount they care claiming is owed. This can help you immensely when it comes to trial in that you can truthfully testify that you have disputed the debt and you will have a balance allegedly owed that likely doesn’t match what they are seeking at trial.
Validating a debt doesn’t take much other than asking and can pay big dividends for you down the road if your case ends up going to trial.