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What to Do If a Debt Collector Asks for Money You Don’t Owe

While there is never any excuse for abuse, the behavior of some relentless debt collectors can border on abusive. Though there are laws to protect you from harassment, a collector may call your home nonstop, as well as harass your family or any other person listed as a reference on your account. Some collectors speak harshly or issue threats, and if you don’t take a stand, this bad behavior can continue for months or years.

If you don’t owe the debt in question, harassment makes the situation even more difficult to deal with. You may repeatedly deny the debt, but to no avail. To resolve your situation, you must start by understanding how debt collectors and collection accounts work.

What Is a Debt Collector?

A debt collector is any creditor who calls for payment on a debt, including an original creditor. However, debt collectors often are collection agencies that purchase an outstanding debt from another company in order to profit on it. For example, if you default on student loans or on a medical bill, the original creditor may give your account to a collection agency. The collection agency can buy the old debt from your original creditor for a reduced amount and keep whatever they collect. Alternatively, original creditors can hire a collection agency and only pay once the debt is collected.

How a Collection Account Affects You

Creditors report collection accounts to the credit bureaus, and the information stays on your credit report for seven years. Furthermore, a collection account lowers your credit score. Having a collection on your report – regardless of whether it’s reported in error – means you could be denied credit cards, auto loans, or a mortgage, and you may also pay a higher interest rate on future loans. Due to the seriousness of a collection account, you should never ignore a debt collector.

What to Do When You Don’t Owe a Debt

1. Don’t Pay or Acknowledge the Debt

Each state has a statute of limitations that dictates the amount of time you’re legally responsible for a debt. This time frame varies from state to state, but averages between 3 and 15 years. The statute of limitations applies to unsecured debts, such as credit cards, medical bills, utility bills, and private student loans, but not federal student loans.

If a debt collector calls out of the blue, don’t hastily acknowledge that a debt is yours. If the debt is valid, in all likelihood, the statue of limitations has passed and you no longer owe the money. Some collectors call after the statue of limitations has passed in a last-ditch effort to collect on an old balance. If you acknowledge the debt, this restarts the statue of limitations, which gives collectors the green light to pursue collection attempts.

Dont Pay Acknowledge Debt

2. Request Proof of the Debt

Within 30 days of being contacted about a debt, write the collection agency and ask the company to verify the debt. By law, debt collectors must provide written verification of this information or cease collection attempts. Keep a copy of the letter for your records. To ensure that your letter reaches the collector, mail your request via certified mail. In return, you receive a receipt when the postal service delivers the letter.

You can challenge or dispute a balance after the debt collector verifies the debt, but you must contact the original creditor to clear the mistake. Call the original creditor, or write a dispute letter. Likewise, the creditor must investigate and respond to your inquiry.

To improve the outcome of your claim, gather proof to support your argument, such as canceled checks or old account statements. If the original creditor verifies the debt and you cannot provide evidence to support your claim, seek help from a debt dispute lawyer.

3. Order Your Credit Report

Identity theft may trigger an unknown collection account. Thieves may open a credit account in your name, and when creditors do not receive payment on these accounts, the information is sent to a collection agency.

Every consumer is entitled to an free annual credit report from each of the three main credit bureaus. Contact to order your copy, and then check the report for signs of identity theft. If you do not recognize an original creditor or a collection agency, dispute the entry. Submit an online dispute via, or write the individual credit bureaus. The bureaus will investigate and, in instances of fraud, remove the collection account from your credit file.

4. File a Complaint

You have rights. If a debt collector fails to verify a debt but continues to call your home or work, file a complaint with the Federal Trade Commission. Furthermore, because this action is in violation of the law, you can sue the debt collector within one year of an alleged violation.

To file a complaint with the FTC, call its helpline at 1-877-FTC-HELP, or complete the online complaint form. You can also file a complaint or sue if a debt collector employs other tactics, such as:

  • Abusive language (profanity, threatening physical harm)
  • Calling your home before 8am and after 9pm
  • False threats, such as threatening to sue or garnish your wages
  • Speaking to others about the alleged debt
  • Calling your place of employment after you’ve asked them to stop
Request Proof Debt

Final Word

Regrettably, some people do not stand up to debt collectors, which only encourages their behavior. If you don’t owe a debt, understanding your rights can help you deal with the collection agency and prevent continued harassment. Keep accurate records throughout the entire process and be patient, as it can take weeks to resolve a collection error.

What other steps have you taken to get a debt collector off your back?

Valencia Higuera is a personal finance junkie who enjoys reading articles on budgeting, saving money, and credit cards. She has written personal finance articles and blogs for several online publications. She holds a B.A in English from Old Dominion University and currently lives in Chesapeake, Virginia.