How To Dispute A Debt: Dealing with Creditors, Collectors and Reporting Bureaus

Credit Report Dispute Papers and PenThe Federal Trade Commission says that debt collectors make one billion contacts with consumers every year.

One billion contacts!

Most of those are phone calls that aggravate, harass and sometimes intimidate consumers, who wonder: How can I make this phone stop ringing?

“Pick it up and say to the person on the other end of the line: Stop calling me!” said Ira Rheingold, an attorney and the executive director of the National Association of Consumer Advocates (NACA).

“But before you hang up, get their name and address, then sit down and write a letter telling them not to call you. Send it by certified mail, return receipt requested so you have a record of this if it keeps going. And knowing the debt collection industry, it probably will.”

Debt collection is a $13.7 billion a year industry.  According to the Consumer Financial Protection Bureau (CFPB), one in three consumers – more than 70 million people! – were contacted by a creditor or debt collector in the past year. The CFPB says that 250,000 debt collection complaints have been filed since 2011, about 85,000 of them in 2015 alone.

Sample Creditor Letter


Sample Credit Reporting Agency Letter


Bill Collector Letter


Rheingold chuckles at those numbers. The NACA is an organization of more than 1,700 attorneys who represent consumers in disputes with businesses and the biggest source of complaints deals with debt collectors.

“Most of the complaints are from consumers who are being harassed for debt they don’t owe,” said Rheingold, who recently made a one-hour appearance on CSPAN to discuss problems with debt collectors. “In a lot of cases, the wrong person is being harassed or even sued for the wrong amount of debt and the collection agencies are using very limited information to bring those cases.”

Know Your Rights Under FDCPA

Problems between consumers and debt collection agencies have been around a long time. In 1978, Congress passed the Fair Debt Collection Practices Act (FDCPA) in an attempt to give consumers protection from abusive practices. The Federal Trade Commission (FTC), which oversees enforcement of the law along with CFPB, says debt collection tops the list of consumer complaints.

The highlights from the FDCPA are:

  • Collection agencies must restrict phone calls to between 8 a.m. and 9 p.m. local time.
  • Debt collectors may not call you at work if you tell them that you are not allowed to receive calls.
  • You can stop all calls by sending the collection agency a certified letter asking them to stop calling.
  • Debt collectors must send you a written “validation notice” that states how much money you owe, the name of the creditor and how to proceed if you don’t think you owe the money.
  • Debt collectors may not make threats of violence, use obscene language, make false claims to be attorneys or government representatives, misrepresent the amount of money owed, or claim that you are going to be arrested.

Even with all those restrictions and protections, the CFPB and state attorneys general receive thousands of complaints from consumers every month about debt collection practices. Most of the problems, deal with debt the consumers say is not owed and the fact collection agencies don’t accurately track details of the original contract from start to finish.

Statute of Limitations On Debt Collectors

The first thing consumers should do is verify that the debt even exists. In addition to the “validation notice” that debt collectors must send, there is a “statute of limitations” on most debts. The statute of limitations varies from state-to-state, from as little as three years to as many as 15. Most states fall in the range of 4-to-6 years.

If the statute of limitations on your debt has passed, it means the collection agency can’t get a court judgment against you. It does not mean they can’t still try to collect, though if you refuse to pay, they have no legal recourse against you.

Many of the problems start with the fact that debt collection agencies often buy debts from several sources and either collect the money or sell the debt a second, third, maybe even fourth time. Along the way, the original contract gets lost and specifics of how much was originally borrowed, at what interest rate, what late payment penalties are involved and how much is still owed, are lost with it.

Consumers need to keep accurate records of all transactions involved with their debt, especially the original contract, record of payments and any receipts. That information is used when filing   a dispute letter with the collection agency.

How to File Dispute Letter with Debt Collectors

The dispute letter should include your personal identifying information; verification of the amount of debt owed; the name of the creditor for the debt; and a request that the debt not be reported to credit reporting agencies until the matter is resolved or have it removed from the report, if it already has been reported.

A second dispute letter should be sent to the credit reporting agencies with much the same information so they too are aware that the debt is in dispute.

Often, however, the matter is not resolved until the information already has appeared on your credit report and thus become a negative factor that on your credit score. If it does make it on to your credit report, yet another form of dispute letter should be sent to the credit reporting agency, disputing the accuracy of the information and asking that it be removed or corrected.

Unfortunately, this is when the situation can become very complicated.

The problems consumers have had disputing information on credit reports has been the subject of several lawsuits and investigative journalism pieces, including one by 60 Minutes, the CBS news magazine. The situation got so hot that the three major credit reporting bureaus – Experian, TransUnion and Equifax – reached an agreement in 2015 with the New York State Attorney General to reform the process for correcting errors.

The reforms are supposed to promote fairness in the process for resolving credit reporting errors, including notifying the other credit bureaus when a dispute has been settled in favor of the consumer.

Best to Check Credit Reports Regularly

However, it is unclear yet whether that process is working so there still could be problems with the information on your credit reports. Each time your debt is sold, if the buyer fails to collect, he could send the information under his company’s name to a reporting agency. Thus, the same debt could be listed under several company names at all three reporting agencies.

“That is why you should check your credit report from each agency every year,” Rheingold said. “If you find an error, send the reporting agency a dispute letter right away.”

Still, collection agencies do not give up easily. Consumers can be sued by a debt collector, and then fail to show up for the court date and thus have a judgment go against them. Some consumers try to represent themselves with predictable results.

If the debt collectors do win a court judgment, they can attempt to incharge-debt-collector-sample-dispute-letters to recoup their money, depending on what state the judgment was entered. If you try to appeal the case, it is wise to find a consumer advocate attorney to represent you. If you can’t afford it, go to the local Legal Aid Society and try to get legal representation.

“Ignoring the court date is the worst possible thing you can do,” Rheingold said. “The standard of proof is minimal in most cases so you can bet your life that whether you owed the debt or not, (debt collectors) will get a judgment against you if you don’t show up.” Losing can result in your wages being garnished by a creditor.

“If a judgment goes against you, find a lawyer. If you do so within 30 days and your lawyer files a motion to reconsider, you have a chance to get it overturned. The crucial thing is to make sure the debt collector has the information necessary to bring the case to court. A lot of times, he is working off a line of data that says the amount owed, but with no real proof that you are the one who owes the debt.”


Huffman, M. (2016, July 28) Debt collectors face tighter regulation by feds. Retrieved from

Dwyer, D. (2015, December 8) Don’t recognize that debt? Here’s what to do. Retrieved from

NA, (2016, March 29) CFPB Monthly Complaint Snapshot Examines Debt Collection Complaints. Retrieved from

NA, (2015, May 15) Debt Collection. Retrieved from

NA, ND. Can a debt collector garnish my bank account or my wages? Retrieved from