April 19, 2024


Delighting finance buffs

The One Thing Collection Agencies Don’t Want You to Know

Closed Border States are great for people that owe money to live in because a lot of collection agencies can never call you or contact you in any way.

The exceptions to this are commercial accounts and if the collection agency that is attempting to collect a debt from you has a license in the same state that you are located in.

How this works to your advantage is that if the collection agency that is trying to collect a debt from you that doesn’t have a license in your state they aren’t going to be able to put anything on your credit report at all. Let me explain why….The Fair Debt Collection Practices Act and the Fair Credit Reporting Acts state that you have to notify the debtor (that’s you) in writing that you have 30 days to dispute the validity of a debt in writing or the debt will be assumed valid. Since a collection agency isn’t allowed to contact you when you live in a Closed Border State they can’t send that to you and even if you weren’t in a Closed Border State when you made the debt you can still have it removed.

To do this you are going to need to dispute your bill. Let me make this clear up front this does not make the debt go away, but it does get it off of your credit report. If you live in a Closed Border State and owe money to a collection agency that doesn’t have a license in your state (most agencies don’t have licenses in multiple states but a few do) what you need to do is get the mailing address of the collection agency that is reporting it to your credit report. Along with the address you are going to need to get your account number, reference number, or file number. That’s all the information you are going to need and can get it in one very quick phone call it will be quick and painless. Now that you have all your account information you’re going to send them a written letter of dispute. Now in this dispute you are going to want to specifically state in it that “if you cannot validate this debt I want it removed from my credit report immediately.”

Now the real beauty about being in a closed border state is that you can still contact the collection agency any time you want about anything on your account and they cannot contact you back even when you tell them to call you back they still by law cannot call you. What you do is to send the dispute letter to the collection agency with your demand on it that it be removed from your credit, then call them on the phone every couple of days just to check and see if they got it off of your credit report or not.

Below is a list of all of the Closed Border States

New Jersey
New York*
North Carolina
North Dakota
West Virginia

*New York isn’t statewide it is in Buffalo and New York City you will need to check your Attorney General to know for absolutely sure.