Was Your Debt Sold to a Collection Agency? DoNotPay Can Help!

Do you have an outstanding debt that was recently sold to a collection agency but you don’t know to negotiate with them? About 30 million people in the United States have at least one account in collections. It's certainly not rare to find yourself unable to pay an outstanding debt and it's not always a surprise when those debts turn up in collections. Unfortunately, some collection agencies don't follow the law when they try to collect debts.

If you are being harassed by debt collectors and you feel unsure about whether to trust them, you are entitled to answers. This DoNotPay guide can help you understand more about the legality of collection agencies, how they operate, and how to deal with them. We can also offer an alternative to trying to navigate this new territory on your own, so you can feel sure your payments are getting into the right hands.

Why Was My Debt Sold to a Collection Agency?

If you have a debt that sits overdue for an extended period of time, often for over 180 days, the originator of the debt may stop trying to collect payments from you after a barrage of phone calls and mail. At that point, the originator of the debt, such as your credit card company or bank, may then sell your debt to a collection agency like ERC to make up for the money they lost.

Once your debt is in collections, you will constantly receive phone calls, texts, emails, and/or letters letting you know your debt must now be repaid to this third party. As irritating as this may be, it is important that you respond to the debt collection agency as soon as they begin to contact you so you can confirm the legitimacy of the debt. If you do not, the collection agency is entitled to:

• Sue you in court
• Garnish your wages
• Put a lien on any property you own
• Hurt your credit score for several years

If you find the collection attempts are lawful, you will want to immediately establish contact with the collection agency and set up a payment plan to resolve your debt and potentially have it removed from your credit report. However, it's important to make sure the collection agency is following the correct steps to collect payment from you before you begin sending them any money.

What Is The FDCPA?

Unfortunately, not all collection agencies follow the laws of debt collection. The FDCPA is a strict set of guidelines that debt collectors must follow in order to collect payments from you. They must:

• Provide you with a debt validation letter at least five days before they start contacting you
• Be willing to pause debt collection attempts until the debt is verified
• Never contact other people in your life regarding your debt or call during strange hours
• Cease communication with you if you direct them to your attorney or if you tell them to stop calling you

If you have been contacted by a debt collector claiming that you must make payments to them, but have yet to receive written debt validation, you are legally entitled to withhold payment until your debt is verified.

For more information about FDCPA, you can contact them.

Can I Dispute Debt Sold To A Collection Agency?

It is within your rights to dispute a debt if you do not believe the debt is yours. However, if the debt collection agency can prove that the debt is yours and that they legally obtained your debt from a creditor, then it is your responsibility to pay it back. If you insist they stop contacting you, they must legally do so. However, if you choose to ignore the collection agency, they can then file a lawsuit against you. The best course of action is to:

1. Confirm the debt is yours
2. Understand your rights and hold the collection agency accountable to FDCPA guidelines
3. Determine how much you can pay and negotiate with the collection agency on a payment plan
4. Ask for a letter of completion after making your last payment, effectively removing the collection from your credit report

The process of confirming your debt, communicating with collection agencies, and negotiating payment plans may feel daunting if it is new and unfamiliar to you. Fortunately, this is not something you have to do alone. DoNotPay can help you get back to being debt-free by negotiating with the collections agency on your behalf and ensuring they are following the correct FDCPA guidelines while trying to collect payment on your debt.

DoNotPay Can Help

Has your outstanding debt been sold to a collection agency and you're wondering if the agency can legally make you pay? DoNotPay can help you find out whether the collection agency is compliant with the FDCPA and figure out what to do next. Simply follow these steps:

1. Search “debt collection” on DoNotPay.

2. Answer a series of questions about the debt collectors, including when you were contacted and how you were contacted, so we can determine if they have violated any debt collection laws.

3. Decide which course of action you want to take based on our guidance, such as filing a debt verification request, demanding for the collectors to stop contacting you, or reporting them to the CFPB.

And that's it! Once you choose the course of action you want to take, DoNotPay will handle the rest. We'll deliver your request directly to the debt collectors via first-class mail, or file your complaint automatically with the CFPB so that they're no longer able to use unfair debt collection practices.

You can also check out our other credit products, including Credit Limit Increase and Clean Credit Report!

What Else Can DoNotPay Do?

In addition to helping you solve issues with debt collection agencies, DoNotPay has many products and services designed to help simplify your life. Our products can help you:

• Handle medical debt
• Cancel any service our subscription
• Write financial aid appeals letters
• Get help paying bills
• Increase your credit limit
• Find missing and unclaimed money
• Get a clean credit report

Sign up for DoNotPay and put our services to work for you.