I have been contacted about a collection agency that stated that an old prescription charge was unpaid. The total was like $1500. When I asked for proof, I received a piece of paper that had three numbers on it that added up to $1500. Nothing more. Literally.
When a consumer asks for proof, they should at the very least receive a fully itemized listing of what it is is being collecting upon. (e.g. a detailed statement of account, or the un-paid invoice(s).) Additionally, consumers should receive documentation as to why they are legally responsible. (E.g. an agreement that they signed.)
I realize that for businesses that traffic in unpaid consumer debt this is going to be a huge burden as this information has long been lost. Too bad.
At the very least, this should be the standard for any debts incurred after a certain date.
Some useful documents would be the last three collection notices ACTUALLY sent to the consumer. Too many collection agencies have claimed they sent me regular notices regarding the debt when I have not have any contact with them for 2 - 3 years. But they claim they have "records" that claim otherwise. Yet, there is no supporting documentation of such efforts. like say, copies of the notices.
Most of the consumer debt I see if coming from debt buyers and the consumer doesn't recognize the name or the amount. Many of these are beyond the statute of limitations to file suit but suit is filed anyway. Many consumers don't know to file an answer is court and a default judgment is entered. The information you suggest would help a lot in letting consumers know what this debt is. I would include the trail of ownership of the debt as there could be intermediary owners between the original creditor and final collector. Debts are sold and resold. It would also help to have some documentation of the specific debt having been sold so the consumer can verify the current ownership of the debt. Currently, all they get in response to a validation request is "we checked and you owe it". Our firm asks for specific documents related to the claimed debt and the response we get is "the courts say we don't have to provide any documents...go fish".
My experience is the collection agency will not correct the debt on the credit report! we need a law requiring the collection company to report debt repayment or debt settlement to the credit bureau in a timely manner... Say 30 days after the debt has been settled, or payment arrangements have been made.
It can be very hard to clean up your credit when working with collection companies...
they want their money but they don't care if your credit report is accurate!
It is unwise to require that the debt collector send sensitive personal information to the debtor (e.g., SSN, account number) as such a requirement would expose the debtor to the danger of ID theft.
I was not the one with debt. I was a mediator trying to help. The people with this situation sometimes ignore the first notice to them and don't ask for a validation letter. Others, I believe, do not read it carefully and see they have a small window of time to dispute the claim.
I think the original notice letter to the debtor should HIGHLIGHT the part about a validation letter. I also, think the original creditor should be required to help resolve disputes instead of debtors or third parties like me only being able to talk with the collection agency.
Probably 50% of the agencies I have dealt with do not follow existing regulations.
Without penalties they never will.
The few that are reasonable and follow the rules are a pleasure to deal with, as a third party.
Every validation notice should include, not only the name, but the address and phone number of the current owner of the debt. It is not always the case that the consumer knows who the owner of the debt is, or how to contact them. This would not be a burden on collection agencies, because it would only require the collection agency to cut and paste the address and phone number of the debt owner onto the validation notice. The collection agency should already have this information in their company records, as the debt collector is forwarding consumer payments to said debt owner's address. This would allow the consumer to attempt to deal with the debt owner directly to try to resolve the dispute. For example, a case of mistaken identity can more easily be resolved by talking to a customer service representative of the debt owner, than by talking to a debt collector. The debt collector has no authority to correct the mistake, but a customer service representative of the debt owner does.
I think the requirement for a debt collector to send a validation notice 5 days after the initial contact is backwards. I believe communication between the debtor and debt collector would be improved if the debtor has the validation notice before the initial telephone contact. The debt collector should be required to mail the debtor a validation notice 5 days before any phone contact, not 5 days after. Otherwise, the debtor is speaking with an unknown caller, who has surprised them with a demand for money. The debtor has not been provided with any time to prepare their thoughts, or to formulate important questions about the alleged debt. They may be caught "off guard", increasing the fear and anxiety of the debtor, which would necessarily lead to impaired verbal communication. The debtor has no written factual statement to refer to during the phone call, while the debt collector has all of the factual details in from of them on their computer screen, and can cite facts and figures. This situation creates an imbalance of power not conducive to good communication. This proposal to require debt collectors to send a validation notice 5 days before the first telephone contact would impose no financial burden on the debt collector, because validation notices are already required to be sent to the debtor. It is simply a change in the timing of an already existing requirement.
Information about the source of the debt (such as the date of the service) can be provided without infringing on the patient's privacy. No one should be asked to pay a debt without first being told why they owe the money. This is esp. true of medical debts, which are notoriously complex and apparently redundant, with many charges occurring on the same occasion.
TaxGuy
1
I have been contacted about a collection agency that stated that an old prescription charge was unpaid. The total was like $1500. When I asked for proof, I received a piece of paper that had three numbers on it that added up to $1500. Nothing more. Literally. When a consumer asks for proof, they should at the very least receive a fully itemized listing of what it is is being collecting upon. (e.g. a detailed statement of account, or the un-paid invoice(s).) Additionally, consumers should receive documentation as to why they are legally responsible. (E.g. an agreement that they signed.) I realize that for businesses that traffic in unpaid consumer debt this is going to be a huge burden as this information has long been lost. Too bad. At the very least, this should be the standard for any debts incurred after a certain date.
View this comment in the discussion thread
Gevian
2
Some useful documents would be the last three collection notices ACTUALLY sent to the consumer. Too many collection agencies have claimed they sent me regular notices regarding the debt when I have not have any contact with them for 2 - 3 years. But they claim they have "records" that claim otherwise. Yet, there is no supporting documentation of such efforts. like say, copies of the notices.
View this comment in the discussion thread
Jane freese
3Most of the consumer debt I see if coming from debt buyers and the consumer doesn't recognize the name or the amount. Many of these are beyond the statute of limitations to file suit but suit is filed anyway. Many consumers don't know to file an answer is court and a default judgment is entered. The information you suggest would help a lot in letting consumers know what this debt is. I would include the trail of ownership of the debt as there could be intermediary owners between the original creditor and final collector. Debts are sold and resold. It would also help to have some documentation of the specific debt having been sold so the consumer can verify the current ownership of the debt. Currently, all they get in response to a validation request is "we checked and you owe it". Our firm asks for specific documents related to the claimed debt and the response we get is "the courts say we don't have to provide any documents...go fish".
View this comment in the discussion thread
Vglass
4
My experience is the collection agency will not correct the debt on the credit report! we need a law requiring the collection company to report debt repayment or debt settlement to the credit bureau in a timely manner... Say 30 days after the debt has been settled, or payment arrangements have been made. It can be very hard to clean up your credit when working with collection companies... they want their money but they don't care if your credit report is accurate!
View this comment in the discussion thread
RickJack
5
It is unwise to require that the debt collector send sensitive personal information to the debtor (e.g., SSN, account number) as such a requirement would expose the debtor to the danger of ID theft.
View this comment in the discussion thread
Mike Smith
6
I was not the one with debt. I was a mediator trying to help. The people with this situation sometimes ignore the first notice to them and don't ask for a validation letter. Others, I believe, do not read it carefully and see they have a small window of time to dispute the claim. I think the original notice letter to the debtor should HIGHLIGHT the part about a validation letter. I also, think the original creditor should be required to help resolve disputes instead of debtors or third parties like me only being able to talk with the collection agency. Probably 50% of the agencies I have dealt with do not follow existing regulations. Without penalties they never will. The few that are reasonable and follow the rules are a pleasure to deal with, as a third party.
View this comment in the discussion thread
paperbag
7Every validation notice should include, not only the name, but the address and phone number of the current owner of the debt. It is not always the case that the consumer knows who the owner of the debt is, or how to contact them. This would not be a burden on collection agencies, because it would only require the collection agency to cut and paste the address and phone number of the debt owner onto the validation notice. The collection agency should already have this information in their company records, as the debt collector is forwarding consumer payments to said debt owner's address. This would allow the consumer to attempt to deal with the debt owner directly to try to resolve the dispute. For example, a case of mistaken identity can more easily be resolved by talking to a customer service representative of the debt owner, than by talking to a debt collector. The debt collector has no authority to correct the mistake, but a customer service representative of the debt owner does.
View this comment in the discussion thread
paperbag
8
I think the requirement for a debt collector to send a validation notice 5 days after the initial contact is backwards. I believe communication between the debtor and debt collector would be improved if the debtor has the validation notice before the initial telephone contact. The debt collector should be required to mail the debtor a validation notice 5 days before any phone contact, not 5 days after. Otherwise, the debtor is speaking with an unknown caller, who has surprised them with a demand for money. The debtor has not been provided with any time to prepare their thoughts, or to formulate important questions about the alleged debt. They may be caught "off guard", increasing the fear and anxiety of the debtor, which would necessarily lead to impaired verbal communication. The debtor has no written factual statement to refer to during the phone call, while the debt collector has all of the factual details in from of them on their computer screen, and can cite facts and figures. This situation creates an imbalance of power not conducive to good communication. This proposal to require debt collectors to send a validation notice 5 days before the first telephone contact would impose no financial burden on the debt collector, because validation notices are already required to be sent to the debtor. It is simply a change in the timing of an already existing requirement.
View this comment in the discussion thread
muscogulus
9
Information about the source of the debt (such as the date of the service) can be provided without infringing on the patient's privacy. No one should be asked to pay a debt without first being told why they owe the money. This is esp. true of medical debts, which are notoriously complex and apparently redundant, with many charges occurring on the same occasion.
View this comment in the discussion thread