Definition
Debt verification or validation is the act of a debtor requesting proof that a financial obligation exists.
Analysis
A collection agency is required to notify a debtor within the first collection attempt that the debtor has 30 days to contest the debt. If a debtor fails to request proof that they owe the amount within that timeframe, then the debt is assumed to be valid. Normal collection activity may commence beyond that initial period.
If a debtor does contest the debt or requests verification, then the debt collector is prohibited from pursuing normal collection activity until after they have provided a response. Failure to abide by this rule is a violation of the Fair Debt Collection Practices Act (FDCPA).
Requesting verification of the debt must also be recorded on any credit report in which the contested debt appears. This provision is found in the Fair Credit Reporting Act (FCRA).
