What to Do When Contacted about a Debt

The information in this article only applies to third party debt collectors collecting debts for personal, family, or household purposes. A third party debt collector is anyone who regularly collects debts for others. You can’t use this article for business debts or fines. The laws in each state are different. If you live outside of Montana, you’ll want to find legal help in your state. 

Within 5 days of contacting you, a debt collector must tell you in writing:

• How much they think you owe,
• The name of the original creditor,
• That you have the right to dispute the debt within 30 days, and
• That if you dispute the debt, the creditor will give written verification of the debt. 

If the debt collector does not give you all of this information in writing, you can send them a “Debt Validation Letter.” The Debt Validation Letter says that the debt collector did not give you all of the information they are supposed to, and that may be against federal law. The letter also asks the debt collector to not contact you again unless they send you all information required by federal law. You can find our Debt Validation Letter in the Take Action section at the bottom and send it to a debt collector. 

The Debt Validation Letter is not a Cease Contact Letter. The debt collector may contact you after getting the Debt Validation Letter. Keep reading to learn more about next steps you can take. 

The debt collector must send you in writing the information that you asked for in your letter. 

Once a debt collector sends you the information that you ask for in the Debt Validation Letter, you may want to:

• Learn more about your rights when dealing with a debt collector
• Dispute the debt
• Get legal help

It is important to know that you have rights when dealing with a debt collector. There are many things that debt collectors are not allowed to do. If you have questions about debt collection, it’s a good idea to read our article Know your Rights When Dealing with a Debt Collector. 

After the debt collector gives you the information that you asked for in your Debt Validation Letter, you only have 30 days to dispute the debt. You can dispute a debt by sending a Debt Dispute Letter. 

You may want to dispute a debt if:

• You do not believe you owe all or even some of the debt; or, 
• You want the debt collector to explain why they think you owe the debt.  

As an example, you might agree that you owe some debt but think the debt collector has the amount wrong. In this case, it’s a good idea to dispute the debt. 

You have the right to make the debt collector explain why they think you owe the debt. You can protect that right by sending a Debt Dispute Letter.

Legal Help

If you any have questions, it’s a good idea to talk to a lawyer. If the debt collector does not give you the information that you ask for in the Debt Validation Letter, you’ll want to talk to a lawyer right away. 

Montana Legal Services Association (MLSA) provides free legal help to eligible clients. Learn more about how to apply for free legal help. 

Legal Forms

• Download our Debt Validation Letter
• Download our Debt Collector Phone Call Checklist

Financial Counseling

Financial counseling can help you understand your financial situation and options. The Department of Housing and Urban Development (HUD) trains and certifies non-profit housing counselors across the country. Because of this, you can have confidence that a HUD-approved housing counselor is well equipped to help you understand and evaluate your options. HUD-approved housing counselors can give advice on credit issues, renting, foreclosures, defaults, and buying a home. You can find a HUD-certified counselor near you.