Credit Repair: Part 3 – the Letters and the Laws

Continued from Credit Repair – Part 2 – the Methods

I’ve used some form of the following letters to contest credit issues.

This first letter

is to the creditor (group 1). The creditor must either provide you with proof of confirmation of your identity or tell the collections agency to remove the account. First, you must contact the original creditor by phone. If they’re out of business, your debt must be canceled. If they answer, get a name, their legal address, and ask (politely) what kind of record keeping proves your debt to them. If they don’t have positive ID (like a bank would request), then send this letter to their legal address.

May 27, 2017
Re: Acct # WERNICKE, CHARLES  
SSN ***-**-1234  
DOB 01/01/1901
Dear Legal Department:

This letter is in regards to a phone call I placed to your organization on April 1, 2017.  I called to inquire about an account that is listed on my credit report and spoke to an employee who identified herself as Rachel. 

The account is from Feb 24, 2012 for $780.

She informed me that your company does not have any proof of identity on this account and that all documentation was sent to a collection agency. I was the victim of identity theft. I don't understand how the investigation confirmed this debt without any documentation or proof of my identity for purposes of incurring a debt? I have copied the collection agency with this complaint.

Please remove these debts from my credit history. They are not mine. If this incorrect information is not removed from my credit reports, I will file suit against your organization for violating the FDCPA and/or the FCRA as applicable.

Sincerely,
Your Name Here

At the same time,

you will need to send a letter to the collections agency (group 2). They need to be notified that the creditor (group 1) has received a challenge and to expect a follow-up. The agency (group 2) can be sued (successfully) for failing to comply with federal law. It’s not worth it to them to pursue a legally contested account. They will probably abandon it rather than risk it.

May 27, 2017
 Re: Acct # WERNICKE, CHARLES
 SSN ***-**-1234
 DOB 01/01/1901
 

Dear Legal Department:

I recently disputed the collection accounts reported on my credit by NTL. I was the victim of identity theft during 2012. The debts were allegedly verified, however, as legitimate debts:

THE ORIGINAL CREDITOR COMPANY Feb 24, 2012 $780

I contacted the creditor (THE ORIGINAL CREDITOR COMPANY) on April 1, 2017, and spoke to Rachel.

Rachel informed me that THE ORIGINAL CREDITOR COMPANY does not have any documentation on this account and that it was all sent to your collection agency. I don't understand how the investigation confirmed this debt without any documentation or proof of my identity? I have copied the creditor with this complaint. Please remove these debts from my credit history. They are not mine. If this incorrect information is not removed from my credit reports, I will file suit against your organization for violating the FDCPA and/or the FCRA as applicable.

Sincerely,
Your Name Here

Now keep an eye on your weekly credit reports.

You will normally see the credit bureaus (group 3) drop the problem claims without further effort. If nothing happens and you receive nothing in the mail, send both letters again. Give them a month. If they ignore the second try, then take them to small claims court.

Here’s the law:

FCRA: Fair Credit Reporting Act (1970)

is U.S. Federal Government legislation enacted to promote the accuracy, fairness, and privacy of consumer information contained in the files of consumer reporting agencies. It was intended to protect consumers from the willful and/or negligent inclusion of inaccurate information in their credit reports. To that end, the FCRA regulates the collection, dissemination, and use of consumer information, including consumer credit information. Together with the Fair Debt Collection Practices Act (“FDCPA”), the FCRA forms the foundation of consumer rights law in the United States. It is enforced by the US Federal Trade Commission, the Consumer Financial Protection Bureau.

The following excerpt from the Act explains legal procedure:

§ 623. (a)(8) ABILITY OF CONSUMER TO DISPUTE INFORMATION DIRECTLY WITH FURNISHER
(D) SUBMITTING A NOTICE OF DISPUTE- A consumer who seeks to dispute the accuracy of information shall provide a dispute notice directly to such person at the address specified by the person for such notices that–

(i) identifies the specific information that is being disputed;

(ii) explains the basis for the dispute; and

(iii) includes all supporting documentation required by the furnisher to substantiate the basis of the dispute.

(E) DUTY OF PERSON AFTER RECEIVING NOTICE OF DISPUTE- After receiving a notice of dispute from a consumer pursuant to subparagraph (D), the person that provided the information in dispute to a consumer reporting agency shall–

(i) conduct an investigation with respect to the disputed information;

(ii) review all relevant information provided by the consumer with the notice;

(iii) complete such person’s investigation of the dispute and report the results of the investigation to the consumer before the expiration of the period under section 611(a)(1) within which a consumer reporting agency would be required to complete its action if the consumer had elected to dispute the information under that section; and

(iv) if the investigation finds that the information reported was inaccurate, promptly notify each consumer reporting agency to which the person furnished the inaccurate information of that determination and provide to the agency any correction to that information that is necessary to make the information provided by the person accurate.
(v)

§ 616 and § 617 of the FCRA talk about how much the fines are for violations of the FCRA (the willful and negligent noncompliance), typically $1,000 per violation in small claims court.

§ 623(c) of the FCRA affords that if you challenge the original creditors (group 1), without first having disputed through the credit bureaus (group 3), you are likely screwed. Don’t do it. Contest your claim with the credit bureaus first!

FACTA: Fair and Accurate Credit Transactions Act (2003)

is a United States federal law as an amendment to the Fair Credit Reporting Act. The act allows consumers to request and obtain a free credit report once every twelve months and created AnnualCreditReport.com, to provide free access to annual credit reports.

The act also contains provisions to help reduce identity theft, such as the ability for individuals to place alerts on their credit histories if identity theft is suspected, thereby making fraudulent applications for credit more difficult.

In summary,

you should now have all the ammunition you need to restore your credit. Put a little effort into it and you’ll be back on track in no time. Identity theft need not be the end of the world. Thanks for reading through to the end. Bee bopity bo.

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