How to Dispute Credit Debt

When a collection agency contacts you in error, or you see a charge on a statement that is not yours, your first reaction may be to panic. But the agency may have posted a charge to the wrong account. Or, a debt buyer may have bought the account, and may now be trying to collect from anyone--even someone with a similar name. The debt buyer may have paid as little as 25 cents per $100 balance, and if he can convince you to pay even a small amount, he makes a profit. It is therefore best to dispute the charge methodically, and without emotion.

Instructions

1

Keep your cool. When you become emotional, you are giving the collector exactly what he wants. He knows that if he can get you acting on emotions, you are more likely to pay.

2

Dispute the debt in writing. If it is a credit card charge on your account that you did not make, follow the credit card company's procedure for filing a dispute. Write a letter stating why you do not believe that you are responsible for the charge. Include supporting evidence you have--even though it is up to them to prove that you owe them. The bank or credit card company must acknowledge your letter within 30 days and remove the charges, or explain why they are correct, within 90 days.

3

Fight a credit card charge with the card company itself if you have an issue with merchandise or services you charged. You should try to work this out with the merchant first, but the law allows you to dispute a charge with the credit card company if you cannot work things out with the merchant. The credit card company may investigate to see if your concern is valid. If so, they may give you a refund.

4

Mail a debt verification letter to anyone who is trying to collect a debt from you. This letter asks them to prove that they are legally entitled to collect this debt by providing evidence to you. This is typically a signed contract, account history, or anything that proves that the collector is legally entitled to collect this debt from you.

5

Stand your ground--do not let collectors harass you. If it is your debt and you cannot pay, simply tell them that you cannot pay. If they are abusive on the phone, hang up. If someone threatens you with a negative posting to your credit report if you do not pay a debt that is not yours, remind them of the Fair Debt Collections Practices Act. This law describes how collectors must deal with debtors and it prohibits abusive treatment of people by collection agencies. It also provides civil penalties when collectors violate the law.

6

Tell the bill collector not to contact you anymore. This is particularly effective with abusive collectors. Proceed with debt verification, and all the steps to stop a wrongful collections action, but do not put up with abuse.