Question: I gave a car back to finance company. It is in collections. I sent 2 certified letters to verify debt. I wanted to know how they reached the amount that I owe. I requested to see proof of calculation and how they reach that amount. I did not hear anything.
I sent all my literature to credit bureau (including certified mail) they sent me something back saying “verified.” I don’t know what to do at this point. The company is Santander Consumer.
Answer: Your issue unfortunately is common. The Fair Debt Collection Practices Act (FDCPA) does not properly define when and how collection agencies must validate a debt. There are a few strategies you can try but in the end, you may have to seek legal advice in order to get a resolution to this matter.
1. Make a complaint to the FTC. The FTC governs the Fair Debt Collection Practices Act. You can go online and make a complaint against the collection agency. There are no immediate remedies but it is good to make a complaint because if the FTC gets enough complaints about a particular collection agency, they will take action.
2. Check your state laws. States usually have separate but similar laws to the federal FDCPA. For instance, California has the Rosenthal Act and Texas has the Finance Code which governs debt collectors. You can make a complaint to your state’s attorney general for their refusal to validate a debt yet verify the debt with the credit bureaus.
Many consumers never use their state laws or state’s attorney general to settle issues. It is a valuable resource to settle issues with debt collectors. It forces debt collectors to respond to the attorney general. Collection agencies typically do not ignore inquiries from an attorney general.
3. Deal with the credit bureau. Since you made a dispute with the credit bureaus (good work on your part) you can now request the method of investigation. Read more about the method of investigation here. Once you request the method of investigation the credit bureaus have 15 days to respond to you with the name, address, and telephone number of the person at the collection agency who verified the dispute as accurate.
This puts the credit bureaus on the hot seat because they rarely if ever do an actual investigation even when consumers send supporting documents along with their disputes.
The credit bureaus simply send a computer code to furnisher of information and the furnisher of information verifies the code. No real investigation is done which violates the Fair Credit Reporting Act. The credit bureaus can be sued if no real investigation has been conducted and they continue to report un-validated, inaccurate information.
4. Dispute directly with the furnisher of information. Under Section 623 of the FRCA, you can dispute directly with the furnisher of information. Disputing directly with the furnisher of information puts the responsibility of investigating disputes directly with the company which placed the negative mark on your credit. This makes them accountable for reporting erroneous or inaccurate information to the credit bureaus.
The furnisher of information has 30 days to respond to the dispute just like the credit bureaus or the information must be removed. Now, in your case, the collection agency is the furnisher of information and they will probably verify the negative listing as correct.
If they do verify the information as accurate, you can request the information used to verify the dispute as accurate. That way you may be able to get their accounting of how they arrived at the amount owed.
Good luck to you.
