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Don’t be a “Verification Sucker” – When You’re Not in Kansas Anymore

When a debt collector sues you as the first thing you hear from it (they can do that), this does not give you a right to dispute and require verification. Your rights are through the legal process, and you must answer the petition or you will be defaulted. Sometimes debt collectors use people’s confusion over their rights and do things which suggest you could dispute the debt. This video discusses your rights.

You would be amazed how often people ask me whether they should “just send a verification letter” to the company or law firm when they get served with a debt lawsuit. Or as one person put it, “now that I’ve called the court to tell them I object, should I just send a verification letter? Or was that enough?”

No. It wasn’t enough – it wasn’t even anything at all.

Dispute and Verification

Click here for a copy of this article in pdf form: Don’t be Verification Sucker

Let’s take a quick step back here and review some facts and some rights.

When a debt collector first contacts you regarding a debt it is attempting to collect, it is required by law to provide you certain information. If the contact is not in writing, it must send you a notice in writing. If the contact is in writing, that contact must contain a notice. That notice must inform you of the debt collector’s identity, the nature and amount of the debt in question, and your right to dispute the debt and require verification. People often refer to this notice as the “verification letter,” although more properly it’s a notice of the right to dispute the debt. If you dispute, they must verify the debt before attempting to collect again, and you have thirty days to dispute the debt.

If they don’t want to attempt to collect again, they don’t need to dispute. It’s a law supposed to prevent continued attempts to collect on an unverified debt.

A Lawsuit is NOT a First Contact

If you’ve never heard from a debt collector, can they sue you for a past due debt? And if they do, must they give you notice of your right to dispute? Yes. And no. They can sue you without first bugging you for money. If they do sue you, the lawsuit is NOT a contact that triggers your right to dispute and verification. That’s what the Fair Debt Collection Practices Act (FDCPA) says, and the reason for that is simple: you’re in the court system and play by court rules once a lawsuit gets filed.

You Must Answer

And the court rules are that once you get served with a lawsuit you must file an Answer (or other “responsive filing” – a motion to dismiss, for example) or you will be in default. Put another way, if you don’t respond in court with an Answer denying liability or a motion to change or get rid of the lawsuit, you will lose. The lawsuit changes the rules, and you “aren’t in Kansas anymore.” [That’s what Dorothy says in the Wizard of Oz when all the weird things start happening.]

Don’t be a Verification Sucker

The debt lawyers know the rules very well, and one would like to think that it’s only an “excess of caution” that causes them sometimes to print the FDCPA language on their lawsuit. But given the fact that so many people have sent dispute letters instead of answers, and the fact that the debt collectors KNOW this, that might be naïve.

What I’m here to tell you is that whether or not such language is on your lawsuit, YOU MUST ANSWER THE SUIT or face a default judgment. Don’t be a sucker – file an Answer or other responsive document within the time allowed by the rules of civil procedure. You must defend yourself in court – you’re not in Kansas anymore, and the FDCPA no longer applies.

A Little Window, Maybe

Litigation does not technically rule out the FDCPA entirely, just the “first contact” rule. It may be that the debt collector’s attachment of the notice to a lawsuit is itself a violation of the FDCPA, as it may be an attempt to sucker you into seeking verification instead of answering the lawsuit. It might be an unfair attempt to get a default judgment. I have argued as much before. That might give you a counterclaim to their lawsuit.

And if you have sought verification rather than answering, and they got a default judgment, you should certainly consider moving to vacate that judgment either on the basis of that deception or your own confusion. The courts favor judgments on the merits rather than technicalities, so there’s a very good chance such a motion to vacate, if filed in time, would work.

But these are not exceptions to the rule that you must respond to the lawsuit in court. If you get sued, the FDCPA no longer applies in that way. You must respond or they will get a default judgment against you, and the next you will hear about it will be when they garnish your wages or bank accounts. Don’t let that happen.

Disputing and demanding verification would be much easier, no doubt, but it doesn’t work at this point.

Don’t look for the “easy” way. Look for the RIGHT way.

 

Debt Verification – How to Protect Yourself

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Dispute and Debt Verification under FDCPA

Within five days of first contact, a debt collector is supposed to identify itself and advise you of your right under the FDCPA to seek verification. This right will also have what we call the “mini-Miranda,” which is notification to you that the communication is seeking payment of a debt (alleged debt) and that any information you provide will be used for the purpose of collecting that debt. You should dispute the debt and demand verification.

Disputing – A Step toward Protecting What’s Yours

Mini-Miranda

You must take the mini-Miranda seriously. Debt collectors often record, and always at least make notes of, anything you say. They are building a file on you from the first time they contact you. You should remember that anything you say that reveals financial information will be remembered by the debt collector, and that anything you say that sounds bad for you, like cussing or name-calling, may come up again at a bad time for you. This is why I say that silence is golden with debt collectors.

Verification

The other right you are told about, of course, is your right to seek “verification” or “validation.” If you request it within thirty days of receiving notice of your right, the debt collector must validate the debt and notify you before taking any further action on the debt. For some reason, debt collectors often will not do this if you seek verification, but instead will either ignore the request or sell the debt and move on to greener pastures.

What Is Verification?

Verification is not a clearly defined term. It was certainly not required as a means of slowing the debt collection process substantially. It appears to be almost a pure formality, but it does at least, according to most courts, require the debt collector to contact the original creditor and make sure, in some vague sense, that the debt is supposed to involve you. If that sounds vague or minimal to you, I’m sure you’re right. But it is an actual obligation that the debt collector take some time and do something besides harass you, and it does require them to stop harassing you, and it may give you a claim against them if they continue bugging you before verifying the debt. These are all good things.

And it often makes them go away entirely.

Requiring Verification – Your Secret Weapon against Debt Collectors

When you get the first notice that a debt collector is after you, you should get an opportunity to “dispute and request verification.” That right is provided by the Fair Debt Collection Practices Act (FDCPA). Click here to get your free copy of the FDCPA. This video here explains why you should dispute the debt and require the debt collector to verify it. In other words, always seek verification  And this video shows you how to do it, and how it affects some of your other rights, because often a debt collector will either disappear completely once you seek verification or will fail to provide verification but still harass you – a violation of the FDCPA.

But remember this does not work if they file suit against you – if you don’t answer a lawsuit when it is filed, you will lose the case. See Bogus Right to Verification on Petition – Dirty Trick! If you have already sought verification but not received it, you might file a motion to dismiss based on their failure to verify.

Here’s what to do if they fail to verify the debt before suing you.

When debt collectors contact you for the first time, they are supposed to send you a written notice of your right to dispute and require them to verify the debt. They are to inform you that you have 30 days to send in this dispute, and if you do so, they are supposed to “verify” the debt prior to taking any further collection actions.

Now, to be clear, we do not think the “verification” to which you have a right under the FDCPA amounts to much, but we do, in fact, recommend making sweeping demands of the debt collector. At a minimum, you may get some materials that will be useful if they decide to sue you. And there’s a pretty good chance that disputing the debt will cause them to go away and leave you alone. I have never had a satisfactory explanation for why this might be, but it appears to be the case. Therefore it makes sense to demand verification when you first hear from a debt collector.

Take NOTE

This right to verification does not extend to law suits. If they serve you with a lawsuit, you must answer the petition or lose the case. You HAVE NO RIGHT TO VERIFICATION ONCE THEY FILE SUIT. But if they have contacted you, and you have demanded verification before they filed suit, then they should verify before filing suit. Failure to do so violates the FDCPA.

Also note two other things: your dispute should be in writing – they don’t have to verify if it isn’t. And while you have only thirty days to make the dispute, they can take any amount of time in providing that verification – it’s just that they cannot make other attempts to collect the debt until they do.

Requiring Validation – A Consumer’s “Secret Weapon”

In my opinion, requiring that a debt collector validate or verify your debt when they first contact you is underused as a weapon. It’s easy and free for you to do (and isn’t hard for them to answer, either), but surprisingly often it can lead to the debt collector walking away and leaving you alone.

The Fair Debt Collection Practices Act (FDCPA)

The Fair Debt Collection Practices Act (FDCPA) gives someone being harassed by debt collectors several useful tools. One of the best of these tools is requiring verification.

A “Secret”(?) Weapon

There’s nothing secret about requiring verification, but in my opinion consumers don’t use this one often enough. It costs nothing to use, takes very little time, and often, all by itself, is enough to convince them to leave you alone and look somewhere else for their victims.

The Right to Verification

Under the FDCPA, the first written communication from a debt collector must inform the consumer of his right to require verification of the debt (if the request is made within 30 days). Verification, or validation requires the collection company to go back to its source, the original creditor, and make sure that the consumer being contacted is the correct person and the debt is valid. Until the debt is validated, the collector may not take any further action on collecting the debt, and at least all the cases I’ve seen have included within that restriction any reporting of the debt to the credit reporting agencies. If the debt collector proceeds without verifying the debt first, you have a right to sue it.

The Requirement Is Absurdly Easy to Fulfill

The obligation is not very significant-a phone call will do, perhaps even as little as a checking of the computer tape or digital record. And yet even this minor obstacle will make the collection company go away surprisingly often. Perhaps the debt collectors view the early assertion of consumer rights as a warning of trouble to come.

Forming Good Habits Early On

And for the consumer, forming the habit of asserting legal rights seems to be an important step in bringing the whole debt situation under control. Out of this small acorn can grow a strong tree of financial security.

How to Require Validation

The way to require verification is very simple. When you receive a debt collection letter you simply write back to the debt collector and tell it you dispute the debt and request immediate verification. No special wording is required–nor is any special delivery (like registered mail), but I always suggest that you in fact send the request by registered mail, return receipt requested, so you will be able to prove that you wrote the letter, sent it, and that it was received by the debt collector. It is also a good idea to keep a copy of the actual letter that you send, too.

What If They’re Just Calling You?

But what happens if you’re just being telephoned by the debt collector? Under the FDCPA, a phone collector is required, within five days of the first contact, to send you, in writing, a notice of your right to dispute the debt and request verification. Failure to do so is a violation of the FDCPA that gives you the right to sue the company. And note that every communication from the debt collector should also have what we call the “mini-Miranda” disclosure, that “this communication is from a debt collector and any information you give may be used to collect a debt.”

Require Verification from EVERY Debt Collector

Every debt collector is different, and each one is required by law to provide you the right to dispute the debt and require verification. But by “debt collector” I mean the company that is harassing you, not the individual who happens to be calling you for that company.

Get in the habit of standing up for your rights, starting with the right to seek verification. Debt collectors are looking for the easiest way to make their profit, and standing up for your rights lets them know you won’t be easy.

What to Do Now

You will find information on many issues that come up in debt litigation and materials you can use to defend yourself here at our site. But for much more help, you should consider joining us.