Many consumers wonder what a debt validation letter is. They are often confused with debt verification letters even thought they are both quite different things. Debt validation letters when used correctly provide many consumers protection from creditors or debt collectors that are attempting to collect on their credit card accounts.
Before you can understand why debt validation letters are so important, you need to know a little bit about the history of the credit card debt collection industry. The credit card debt collection industry has not always been very ethical. Companies would use harassment and intimidation to trick people into paying on their defaulted debt to companies that they did not owe money. Eventually, legislation was passed to prevent some of these practices.
Without this new legislation, known as the FDCPA or Fair Debt Collection Practices Act, consumers would not have the necessary legal protection to stop incorrect collection efforts by these companies. The Fair Debt Collection Practices Act is what provides power to debt validation letters.
Debt validation letters have the most effect when sent timely and with the proper composition. Once a creditor or debt collector receives one of these letters they are left with three choices. One, they can validate the account and continue the collection process. Two, they can stop all collection efforts. Three, they can chose not to validate the account and continue collection attempts running the risk of a federal lawsuit.
There is one downside to the FDCPA and debt validation letters. The downside is that creditors and debt collectors are not required to validate your account unless you request the validation. Most people assume that if a collector is calling you that they already have all the information that they need to collect. The fact is that about 90% of the time this is not true.
Now that you realize a little bit about your creditor or debt collector, I am sure you are beginning to see why they try to keep you away from knowing about debt validation. You may be thinking that there is no way that such corruption happens on a daily basis, but I can assure you that it does. Credit card debt collection could not be as large of an industry as it is now without the corruption because the majority of third party debt collectors do not have the information required by the FDCPA to collect on any accounts.
So how can you use debt validation letters to protect yourself today? Simple, you need to become an expert. This may seem overwhelming to you but trust me it is not that hard. The easiest and most effective way to gain this expertise is through the use of well-written debt validation letter templates. These template letters can help you eliminate unwarranted collection efforts altogether.
Before you can understand why debt validation letters are so important, you need to know a little bit about the history of the credit card debt collection industry. The credit card debt collection industry has not always been very ethical. Companies would use harassment and intimidation to trick people into paying on their defaulted debt to companies that they did not owe money. Eventually, legislation was passed to prevent some of these practices.
Without this new legislation, known as the FDCPA or Fair Debt Collection Practices Act, consumers would not have the necessary legal protection to stop incorrect collection efforts by these companies. The Fair Debt Collection Practices Act is what provides power to debt validation letters.
Debt validation letters have the most effect when sent timely and with the proper composition. Once a creditor or debt collector receives one of these letters they are left with three choices. One, they can validate the account and continue the collection process. Two, they can stop all collection efforts. Three, they can chose not to validate the account and continue collection attempts running the risk of a federal lawsuit.
There is one downside to the FDCPA and debt validation letters. The downside is that creditors and debt collectors are not required to validate your account unless you request the validation. Most people assume that if a collector is calling you that they already have all the information that they need to collect. The fact is that about 90% of the time this is not true.
Now that you realize a little bit about your creditor or debt collector, I am sure you are beginning to see why they try to keep you away from knowing about debt validation. You may be thinking that there is no way that such corruption happens on a daily basis, but I can assure you that it does. Credit card debt collection could not be as large of an industry as it is now without the corruption because the majority of third party debt collectors do not have the information required by the FDCPA to collect on any accounts.
So how can you use debt validation letters to protect yourself today? Simple, you need to become an expert. This may seem overwhelming to you but trust me it is not that hard. The easiest and most effective way to gain this expertise is through the use of well-written debt validation letter templates. These template letters can help you eliminate unwarranted collection efforts altogether.
About the Author:
Learn more about how to settle credit card debt. Stop by Allan Henry's website where you can learn all about debt validation letter and what it can do for your finances.
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