If You Dispute A Debt, The Collector Must Mark It As “Disputed” On Your Credit Report

If You Dispute A Debt, The Collector Must Mark It As “Disputed” On Your Credit Report.

Disputing A Collection Debt Can Help Your Credit Report

If you dispute a debt to a debt collector, this can be beneficial in several ways.

First, it lets the collector know that you are not agreeing to the debt.

Note:  not disputing does not mean you agree to the debt but sometimes collectors who don’t understand the law think this…

Second, if the debt collector updates your credit report, it must show it as “disputed by consumer” which can help your credit report because some of the scoring models (to determine your credit score) ignore collection accounts that are disputed.

A lot of the credit scoring companies ignore disputed collection accounts as so many collection agencies put bogus accounts on credit reports.

If you have disputed the debt and the collection agency does not mark the account as disputed, then this normally will violate the Fair Debt Collection Practices Act (FDCPA) — in particular Section 1692e(8) which forbids false credit reporting.

So How Do You Dispute Collection Debt?

Two ways.  You can do it verbally or in writing.

Both are effective and work but doing the dispute in writing is easier to prove.

Some collectors over the years have taken the position that all disputes must be in writing.

This is false.

This may be what they want, but that does not make it the law.  The law is that disputes can be made over the phone.

If you do it this way, make sure you document carefully the conversation.

Who you spoke with, when, for how long, what you said, etc.

The better approach is to dispute in writing.

You can look at our sample form dispute letter to send to debt collectors as a good starting point.

Send a letter by certified mail telling the collector that you dispute the debt.

Keep a signed copy of your dispute.

Dispute Collection Debt To Protect Yourself

So many bogus scam collectors are out there — some that credit report.

If you don’t know if you really owe the collector who is credit reporting, then consider disputing it so you don’t have to deal with the arguments of the collector that you have somehow “agreed” that you owe the debt.

It is a bogus argument the collection agencies make, but avoid even having to deal with it by disputing the debt in writing.

After you have disputed  the debt, pull your credit reports in 90 days or so and see if the account is marked as disputed if it has been updated.

If it has, then great — the collector is doing what the collector is supposed to do.

If not, then consider suing the collector.

To find out your options, you can call us, if you live in Alabama (we can’t help you if you live anywhere else) by dialing 205-879-2447. 

You can also reach us by filling out our online contact form.

I look forward to chatting with you.

Have a great day!

-John G. Watts


  1. eb says:

    Some misleading info here. The debt only needs to be reported as Disputed until the collector has resolved their investigation; unless the dispute has some legitimacy and includes contrary evidence, that investigation isn’t going to last long: “I don’t think this bill is mine” won’t get very far. Don’t just dispute: prove the debt isn’t yours.

    • John Watts says:

      Thanks for your comment EB. What you have said is a common belief that I don’t think is supported by the law. Collectors will say “You have to prove the debt isn’t yours.”

      I sued a debt collector once who said “The burden to prove anything is on you — we assume the debt is legitimate until you can prove it is not.”

      That is not the law.

      If you dispute the debt –whether you give reasons or not — the debt must be considered by that debt collector to be “disputed.”

      Now if you have reasons, that’s great. Include them. Do as you suggested and prove it.

      But often times you can’t prove a negative.

      For example, a debt collector says you owe $75 from a magazine order 5 years ago. You know you didn’t order the magazine.

      So what do you do?

      Your view of the law is you have to “prove the debt isn’t yours.” How do you do this? You can say it isn’t yours which is proof. But hard to show an absence of payments, etc. until you get a lot of information from the debt collector such as:

      **When did I take out this supposed debt?
      **What’s the name of the magazine you claim I subscribed to?
      **When did the company send me invoices?
      **Show me where I signed for this magazine.

      My suggestion on the approach to take is to do all of the above (in that we agree on) but also to simply state the debt is disputed.

      Now the debt collector has a choice.

      “Do I give the consumer all the information above?”


      “Do I say NO and tell the consumer I’m not playing games with her and she has to pay?”

      Ultimately, if the debt is not owed — or even not owed in the amount claimed — the debt collector has violated the Fair Debt Collection Practices Act (FDCPA) by misrepresenting the debt and collecting an amount the collector is not entitled to collect. These are sections 1692e and 1692f.

      The consumer has to prove this — and the consumer can rely on her own testimony. The difference is in a lawsuit we can force the debt collector to give us every document it has on the account. All electronic data. See if the collector went back to the original creditor to get “proof” or if it did nothing.

      Before a lawsuit, however, and before a judge decides who is right, the collector must mark the account as being disputed. It doesn’t get to say “Well, we investigated it and decided the debt is legit so we are not going to mark your account as being in dispute any longer.”

      That’s a violation of the the FDCPA — section 1692e(8).

      Thanks again for your comment — let me know if you think I’m off on the law or in the way I view this. I look forward to hearing from you again and have a great day!

      John Watts

  2. […] If that’s the case, and your credit report continues to show that you owe the debt collector money after you’ve disputed with them, then you need to look into suing the debt collector for false credit reporting. […]

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