Debt validation is the process by which a consumer may request that any company assigned to collect a debt prove that the consumer actually owes the debt.
The Difference Between Debt Verification and Debt Validation
Although the Fair Debt Collection Practices Act states that a consumer is entitled to validation of his or her collections debts, it does not clearly define what constitutes legitimate debt validation.
The terminology has developed to commonly refer to debt verification as automated printouts containing all personal information the collection agency currently has on the individual (name, address, SSN) along with the amount owed. Unfortunately this does not legally prove anything other than the fact that the consumer’s information is associated with the collection account in the debt collector’s database.
Verification is also the process by which a credit bureau verifies the legitimacy of a debt on behalf of a consumer during an investigation.
Debt validation, however, is often touted by credit savvy consumers and credit repair organizations as legally binding proof that the debt in question was accrued by the individual sending the dispute letter. The only true validation, according to this school of thought, is a copy of the contract the individual first signed with the original creditor agreeing to pay the debt.
Why Debt Verification May Not Hold Up in Court
Anything can be typed into a computer system, printed out, and mailed. While this may seem unethical at first glance, the situation makes perfect sense from a business standpoint. The vast majority of validation requests a collection agency receives are from consumers whose debts are legitimate. By sending a verification, the collection agency can abide by FDCPA laws, continue collection activity, and “weed out” individuals who are attempting to take advantage of the system.
Sadly, this pushes to the wayside those who discover a genuine mistake on their credit reports. Because personal information on consumers is often gathered via skip tracing and not from original creditors, it is perfectly possible for a collection agency to maintain accurate information on a consumer who does not legally owe a debt. This results in a valid verification of an invalid debt.
So What is Real Validation?
Numerous forums and websites across the internet have been dedicated to answering this question when the real answer is quite simple. Since the FDCPA does not define the documentation needed to provide validation, a collection agency can theoretically provide the consumer with any documentation of the account and this is considered adhering to the law. Nowhere in the FDCPA does it state that an original contract signed by the consumer is required for a debt to be legitimately validated.
However, in a court of law this is often the only documentation that proves beyond a reasonable doubt that the individual does, in fact, owe the debt. So pointing to an original contract as the only viable method to validate a debt has its merits.