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Handling a Debt Collection Notice



Any business collecting debts from New York City residents must be licensed by the Department of Consumer Affairs (DCA). DCA protects consumers from unlawful and abusive debt collection practices.

 

 

What to do when you receive a debt collection notice:

IF YOU ARE NOT SURE THE DEBT IS VALID, TAKE THESE STEPS:

  • Act quickly.You must dispute a debt within 30 days of receiving notice. After 30 days if the debt is not disputed, a collection agency is entitled to treat the debt as valid and pursue it further.
  • Send by certified mail a letter to the collection agency requesting proof of the original debt/purchase and creditor.Debt collectors cannot pursue you further until they provide the requested proof. Once proof of the original debt has been provided, the agency can seek to collect it.

IF YOU DO NOT OWE THE DEBT, TAKE THESE STEPS:

  • Act quickly.You must dispute a debt within 30 days of receiving notice. After 30 days if the debt is not disputed, a collection agency is entitled to treat the debt as valid and pursue it further.
  • Send by certified mail a letter to the collection agency requesting that it cease contacting you about the alleged debt.After receiving a cease collection letter, a collection agency is only authorized to contact you once more, in writing, to inform you of any further legal action it intends to pursue. At the same time, consumers should warn the collection agency in writing by certified mail against falsely reporting the debt to anyone else.

IF THE DEBT IS VALID, TAKE THESE STEPS:

  • Do not ignore the debt collector.Failure to pay a debt or respond could hurt your credit rating and your ability to obtain loans, mortgages, or other financial services.
  • If you do not want the collection agency to continue contacting you, send by certified mail a letter requesting that it cease contacting you about the alleged debt.After receiving a cease collection letter, a collection agency is only authorized to contact you once more, in writing, to inform you of any further legal action it intends to pursue. If you choose this option, the creditor can sue, report you to a credit agency, and take other lawful actions to pursue the debt.
  • Calculate your finances and figure out your ability to repay the debt.There is a good chance the collector will work out a repayment plan with you. If so, be sure to get the terms of the agreement in writing.
  • Ask the debt collection agency to send you written confirmation that the debt has been paid in full or resolved.

Download a copy of DCA's Debt Collection Guide (in PDF)

Download Information for Consumers: Money Judgments and Frozen Bank Accounts

File a complaint against a debt collector