HOW TO BEAT A COLLECTION LAW

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4 STEPS TO SUCCESS
By Rodney Peak,Esq./Citronelle,Alabama,
Matt Nichols,Esq./Birmingham/Alabama

of Credit Repair Champion, LLC. Business Funding & Consulting

of Credit Repair Champion, LLC. Business Funding &

Consulting

Andy Nelms, Esq./Montgomery, Alabama

of Credit Repair Champion, LLC. Business Funding & Consulting

DISCLAIMER: This article comes with a giant, very real DISCLAIMER. This
article does not and is not meant to give legal advice. WE ARE not YOUR
attorneys and we have no attorney client relationship(s). If you use any of the
information imparted by this article, you do so at your own risk and we strongly
urge you to consult your own attorney.

This article is written with

the assumption that the debt
for which you are being
sued is a valid debt
and that it is your debt.
If

you are being sued over a debt that's not yours, please stop reading this article and
find a local lawyer in your area.
If not, then the difficult moment of truth has finally arrived; you've been sued by a debt
collection attorney. So, what do you do now, assuming you simply cannot pay the debt?
STEP ONE
The very first thing you do is request a Federal Fair Debt Collection Practices Act debt
VALIDATION pursuant to

15 USC Section

1692(g) See Validation of Debts NOTE: Some refer to Validation as

Verification. In our humble opinions at Credit Repair Champion, LLC. Business Funding
& Consulting there is no difference so don't let the language confuse you. As far as we
are concerned, for purposes of this article, Validation and Verification are the same thing.

The United States Congress has given us help pursuant to

15 USC

Sec. 1692(g).

This statute requires a collector to cease collection

activities pending the debt's verification or validation. In addition, any credit collector

15 USC 1692(g) is subject to suit and

penalties pursuant to the Fair Debt Collection Practices Act, 15 USC
section 1692(k) , fines range
between $1000 and $500,000
PER EVENT.
found in violation of

As an example, your client has a creditor whom has placed a debt, IRREGARDLESS OF
AMOUNT , with a collection agency or two or three,so on... You , as their professional
voice against the system of vile injustice of mal-reporting and repeated ignoring of
consumer rights , including those of your client's of course. Prior to coming to you, your
client attempted a DIY program, which (NEVER WORK OBVIOUSLY) she sent in 7
separate attempts to dispute this collection accounts thrugh the CRAs( so total of 21
returned verications) , 4 times directly with the collection agencies (so 7 total), and 5
times with the original creditor (another 5 official disputes) for a total of

attempted disputes would of been 40 dispute events

BEFORE
YOUR PROFESSIONAL EXPERT EYES GOT TO THE FILE. NOW THE CASE IS
ON LIFE SUPPORT AND CERTAIN BANKRUPTCY AND FINANCIAL HELL IS
RIGHT AROUND THE CORNER----OR IS IT?YOU GET THE FILES, AND
EQUALLY, YOU TOO DISPUTE AT ALL THREE LEVELS AND EVEN TO THE
FTC ANOTHER 4 ROUNDS (16 more official events of disputes) WITHOUT A
SHREAD OF SUCCESS---now tallying up an incredible 56 DISPUTED EVENTS
ON JUST THAT ONE COLLECTION ACCOUNT. AT THIS POINT, UNLESS
YOUR BRAIN DEAD, IT SHOULD HAVE BECAME OBVIOUS TO YOU BY NOW
THAT THIS IS AN ACCOUNT THAT YOUR CLIENT IS TRULY RESPONSIBLE
FOR!

TIP******NEVER STATE IN YOUR

CLIENT'S LETTERS (DESIGNED BY
YOUR FIRM) IN A FORMAT THAT ARE
APPARENTLY STATING YOU HAVE
POSSESION OF FACTUAL DATA TO

CONTRARY IN NATURE UNLESS YOU

YOURSELF CAN DETERMINE THIS IS
TRUE. NEVER USE YOUR "GUT
FEELINGS", NOT IN BUSINESS NO
MORE THAN YOU WOULD IN MAKING
DECISION A MARRY OR DIVORCE.
BEYOND DOUBT, ALWAYS UTILIZE
THE WORD OF ALLEDGE OR
"declared but not proved" OR
"doubtful or suspect" OR
"questionable,so-called,or
supposed"
, NO MATTER HOW MUCH YOU WANT TO "BELIEVE YOUR CLIENT" AND YOU
MUST AWAYS UNDERSTAND THAT ANYTHING THEY TELL YOU IS AN
"ALLEDGED TRUTH" NOT NECCESSARILY THE FACTUAL TRUTH. THE
CONSMER MAY OR MAY NOT BE MISLEADING YOU TO--WHICH IS EVEN
MORE THAN IGNORANT BECAUSE IT IS BETTER FOR YOU TO KNOW GOING
IN THE TRUTH SO YOU HAVE THE CORRECT ANGLE TO
ATTACK. BUT AFTER HER 16 VERIFICATIONS RETURNED AND YOUR
What is validation or verification? Simply put, proper validation of a debt depends on
the specific nature of the dispute. At a minimum, the debt collector is required to confirm
with the creditor that the amount being claimed is correct and that the person he is
attempting to collect the debt from is the person who owes it. The most basic response to
a validation/verification request would be for the collector to provide the name of the
original creditor and some simple statement regarding the alleged amount owed.
A Word of Caution; we have seen, and you may see, Internet sites exclaiming
that collectors must provide an expansive amount of information, and some will
lead you to believe that if the collector does not answer an exhaustive list of
specific validation requests, then a violation of law is created. THIS IS FALSE,
FALSE, FALSE!!
The United States Fourth Circuit Court of Appeals has opined

that validation can be nothing more complicated than this:

"Verification

of a debt involves nothing more than

the debt collector confirming in writing that the
amount being demanded is what the creditor is
claiming is owed; the debt collector is not
required to keep detailed files of the alleged debt."
See,

Chaudhry v. Gallerizzo,

174 F.3d 394 (1999).

*****(So, don't listen to those internet pundits! No, wait! WE ARE SOME of
those! Okay, you can listen to US,lol. :)
All that having been said, requesting validation of the debt works for two reasons: First
and most importantly, it buys you some time. Under the FDCPA, all collection activity
must cease until the attorney puts that verification in the mail to you. The verification is
usually a simple statement signed by the creditor, and it will not take the collection
attorney long to obtain it or mail it, but it does "stay" collection activities, including
law suits, until answered. Secondly, it sends a signal to the collection attorney that you
are not going to be a rollover debtor. He knows you will be active in the defense of the
suit.
The last point is very critical because a high percentage of collection suits simply proceed
to default judgment without any response from the debtor. Default judgment is a
collection attorney's dream. He loves consumers who don't answer law suits and, believe
it or not, a majority of law suits filed by collection attorneys go unanswered because the
debtors feel like they can't fight the debt in court, usually because they feel they owe the
money so they have no point in fighting.
However, by filing a validation request, you send a very strong message to the
collection attorney that you aren't going to give up. He might actually have to go
to court himself and you may force him to prove the debt.
Also, by filing the validation request, you actually stay the collection
proceedings. Thus, if a collection attorney cannot move forward against you
in a collection suit, the chance of your having a default judgment against you
is greatly diminished. They don't like that one bit.

HOW DO I FILE A VALIDATION NOTICE?

Validation of a debt is very simple and the response is also very simple. The statute
requires the collector to give the debtor the name and address of the original creditor.
Some courts have also required the collector to give a simple accounting of the debt, i.e.
the principal, interest, and other added fees such as attorney's fees.

Again, we

have seen a lot of "on-line" verification/validation

form letters asking for information and
documentation the FDCPA doesn't require the
collection attorney to give you. Such far reaching requests
immediately tell the collection attorney you really have no idea
what you are doing. The form letters also make threats which simply irritate the
collection attorney. And perhaps simply enough, they are wrong.
The FDCPA operates on the least sophisticated debtor standard so you don't
have to be fancy. Just make sure you do it in HAND_WRITING and send it
certified mail AND FAX but NEVER EMAIL----if you ever use email, you
automatically autorize them to verify via the CRA's e-OSCAR SYSTEM,
and since they do not have their own e-OSCAR DEVICE, it allows them to
actually forward the dispute to the CRAs which are suppose to re-contact
that exact same collection agency for validation/verification---now that is an
OXIMORONIC PROCESS but one you have unknowingly authorized. Just
HAND WRITE THE COLLECTION AGENCY NEATLY (CRA's not so
neatly but readable and with various colors and font and NEVER on legal
sized document printer pages, We have found greatest success using those
little yellow notepads believe it or not, using RED-GREEN-PURPLE INK
COLORS ONLY and never BLACK OR BLUE TO CRAs (any size apge or
colors and font to collections is fine---you WANT THEM TO READ IT, no
computers to beat at their locations that we have heard of so far, but
PORTFOLIO COLLIONS IS IN THE TESTING STAGES OF THEIR OWN
VERSION OF e-OSCAR that would theoretically link all collection agencies
together and like e-OSCAR, HAND WRITING in barely readable manner
will be required at that point should it prove successful. BUT FOR NOW,
JUST Simply ask the collection attorney to verify the debt in accordance
with the FDCPA and by what manner this verification was performed (they
do NOT HAVE TO DISCLOSE THIS LATTER PART).
See this sample validation letter:
REMEMBER: ALWAYS SEND LETTERS TO COLLECTION AGENTS
VIA CERTIFIED MAIL.
It's very important not to be antagonistic. Don't threaten the collector and don't lie.
Don't threaten to sue him or report him to the Bar or say you have an attorney if you
don't. These tactics don't intimidate collection lawyers and simply mark your file for extra
special attention. Finally, a certified mail written request for an FDCPA verification may
end the collection process. That is true in a very small percentage of cases, but it is worth
taking as a first step.
STEP TWO
The second step is to file a SWORN DENIAL. This step is vital, especially if you don't

Don't
lie to the
court; if you
owe the
amount in
question, you
cannot deny
owe all the money for which you are being sued.

the debt

. However, seldom does the

collection attorney sue for a correct amount. we'll explain why in another article, but for
now take it on faith that seldom can the collection lawyer justify in an accounting the
complete debt sued for.
The sworn denial is a simple statement filed with the court once you are sued.
This needs to be a statement in WRITING that you FILE with the court where you
have been sued

. It can be a simple statement, but

typed, signed,
notarized, filed with the clerk of the
it needs to be

court, and a copy sent to the collection

lawyer. It needs to be a graduated denial. In other words, it needs

recollection

to say, "I deny

that this is my debt and if it
is my debt, I deny that it is still a valid debt and if it is a valid debt, I deny the
amount sued for is the correct amount".

The sworn
denial is a
powerful

tool!
It eliminates the Sworn Affidavit of Account that the collection attorney has.
The vast majority of collection suits proceed without a witness for the creditor.
The collection attorney enters an affidavit, signed by the creditor, that the debtor
owes the debt and that this is the amount.
With that affidavit in hand, the court gives the creditor a judgment.
When a sworn denial is filed, the debt collection attorney cannot rely upon a

must
instead produce a
sworn affidavit of account, but

live witness
to testify

about the debt. The requirement of a

live witness changes the dynamic of the collection action considerably. The
likelihood that the action will go no further now increases again.
STEP THREE
The third step is to file DISCOVERY. This is more difficult than simply filing the sworn
denial. You need to file a written Request for Production of Documents asking for a copy
of the contract or agreement upon which the debt is based. If the debt is a credit card
debt, it is likely that the debt collection attorney will not be able to secure a copy of
the original agreement, or if he is, he will not be able to do so timely. Most credit card
signature agreements are scanned, or if older, microfilmed and stored away in electronic
archives. If it is an old debt which has been sold to a debt purchaser, the likelihood of
retrieving the original signed agreement decreases dramatically. If you are being sued in
a small claims type court where discovery is not permissible, ask for the agreement
at trial.
STEP FOUR

The fourth step is TRIAL. SHOW UP! I can't stress that enough. As I've said repeatedly,
the vast majority of debt collection suits proceed to default judgment because no one
shows up to dispute them. Show up and ask for a trial. And remember, the worst
thing that can happen is the same thing that would have happened if you hadn't
appeared at all; a judgment. You can't make it worse. If the attorney doesn't have his
live witness available, oppose the case being continued. Tell the judge you've taken off
work to be there and are ready to go forward. If the judge does continue the case to a new
trial date, show up again.
You will need to educate yourself. You won't be able to equip yourself to spar with an
attorney, but knowing a little is better than knowing nothing. You will need to read the
Rules of Procedure that govern the court and the Rules of Evidence for that
jurisdiction. Look them up online. The Rules of Civil Procedure will govern how the
trial is conducted. The Rules of Evidence will govern what the Judge is allowed to see
and hear.

attack
the witness first and the debt second. The
If you do have a trial and the creditor produces a live witness,

can only testify from personal knowledge

witness
.
Generally, the witness has no personal knowledge about you or your account,
but only knows what's in the file he got from the collection department. If he
is going to testify without personal knowledge, but from the records and
documents of the business, then he has to have a basis to do so. He needs to be the
regular keeper of those books and records and be familiar with how they are kept
and their contents.
Don't simply accept his answer when the debt collection lawyer asks him if he is the
regular keeper of those books and records and is familiar with how they are kept and their
contents and he says yes. Ask him how long he has been with the company, in that job,
what he does on a daily basis, when he first saw your file, if he knows from personal
knowledge if it's a complete file, etc. You must destroy his credibility and ability to
testify about the papers he has in front of him. If you can do that, then the debt
collection attorney has no case. If the witness is actually a good witness and you can't
prevent him from testifying about your file, then you need to know your defenses to the
debt.

The best defense is the Statute of Limitations. The

Statute of Limitations is the time limit that an aggrieved
party has in which to file a lawsuit. It is a drop dead
deadline. Find out what your state's is and whether the
creditor is beyond that date. If it is, ask the court to
dismiss the suit.
LAST STEP. Okay, I promised that this would be a four step process but we also

Should
you lose at trial there is one Last Step.
The last step, should you lose at trial, is
assumed you would win at trial, or, better yet, get the case dismissed.

to

APPEAL.

Appeals can take a long time to

work through the system; from months to years. That

time is
valuable and no collection action such
as garnishments can occur during the
pendency of the appeal (unless you live a jurisdiction
that requires that you post an appeal bond to stop collection during an appeal).
At each step in the process, you increase your chances that the debt collection
attorney will give in and simply put your file away.

always be
polite, never
cuss and
don't hang
But remember,

up on him.
You simply
don't want to
make your
case
personal.
DISCLAIMER: This article comes with a giant, very real DISCLAIMER. This article
does not and is not meant to give legal advice. WE ARE not YOUR attorneys and we
have no attorney client relationships with you nor your clients, YOU DO HOWEVER
and ultimately it is you that must dive into the most recent and even the far reaching court
rulings that are similar to your client's situation---but remember, every State and every in
many State's every county within that State has varying laws and are almost certain to be
different than yours at least to some degree---->>>a magistrate of the court will give
leadway to a layman with attorney representation,however in cases such as a client
represented by a firm the magistrate will expect the client's repairer to either be an
attorney of financial law or at a minimum have legal creditials equivalent to such (so

your client will get absolutely zero leadway at all since the hallmarks of being
represented by at least one credit repair firm even before you exists just by what few
letter responses i saw the collections and creditors send back.right now, your client is
"flagged or coded" and none of their disputes are even being opened at CRAs except to
verify contents inside envelope matches that of outer envelope, if it does and its a "coded
or flagged" consumer" there is one way and only one way to have disputes ever read or
taken seriously!
Your client will be required to go to HER LOCAL (NOT CREDITORS---why give them
benefit?or CRAs or COLLECTION AGENCY's) DISTRICT COURT HOUSE AND
FILE A LETTER OF "INTENT TO FILE LAWSUIT" BUT DO NOT HAVE IT
DELIVERED VIA REGISTERED MAIL RETURN RECEIPT REQUESTED, PAY THE
COURT THE $50-$85 TO HAVE IT HAND SERVED BY A JUDICIAL SHERIFF OF
THE CIVIL COURTS WHICH WILL NOT GIVE ORDR TO SOME NOBODY AT
FRONT DESK, BUT RATHER HE WILL HELP HIS SELF THROUGH BUILDING AT
WILL BECAUSE THAT ORDER IS ESSENTIALLY AS POWERFUL AS A
WARRANT FOR HIM, AND HE WILL HAND DELIVER TO THE HEAD PERSON
OF THE LOCATION. IF THAT PERSON IS NOT AT WORK AT THAT TIME, THE
SHERIFF WILL ALLOW ONLY SO MUCH TIME FOR THE HEAD
SUPPERVISOR/OWNER/ETC. TO GET THERE AND ACCEPT/SIGN FOR THE
LOITS (LETTER OF INTENT TO SUE) NOTE AND WARN HIM OF THE $10K FINE
SHOULD HE/SHE FELL TO ANSWER THE LOITS WITHIN 10 WORKING DATES
AND POTENTIAL 180 DAY JAIL SENTENCE! NOW THIS IS NOT LETTER OF
LAWSUIT FILED, IT IS A WARNING------>>>>>>BUT THE EFFECT OF THIS
ACTION BY YOU IS INCREDIBLE IN THAT SUDDENLY YOUR DISPUTES ARE
BEING PROCESSED, NOT NECESSARILY DELETED BUT AT LEAST
INVESTIGATED SOMEWHAT. CONGRADULATONS-----YOUR LOITS DID COST

YOU A FEW BUCKS BUT GUESS WHAT, YOU ARE

NO

LONGER
CODED OR

REDFLAGGED!!!
YOU CAN NOW FEEL LIKE A NORMAL
CITIZEN WHEN DISPUTING THE
ISSUES ON YOUR FILES.
If you use any of the information imparted by this article, you do so at your own risk and
I strongly urge you to consult your own attorney.