Junk Debt Buyers, also called JDB’s, engage in the business of buying distressed assets at pennies on the dollar and then try to collect on that debt. Sometimes they try to go after the full amount, sometimes they’ll accept a settlement amount of 50% or less. It’s not a bad business to be in, except they suffer from one very crucial weakness a smart debt collection fighter knows. When challenged, they can rarely obtain any sufficient documentation of the debt. In other words, they can’t validate the debt  after someone has sent a debt dispute letter !
They can rarely provide validation because the original creditors are most likely long gone. They’ve washed their hands of the account once they sold it to the junk debt buyers at such a discount. The information the buyers have may be lost or incomplete. They most certainly lack a proper chain of custody that would prove the junk debt buyers actually own the right to collect on the debt. If you discover that a junk debt buyer has your account (by doing research on the message boards and sites in the first article ) you now know that you need to attack their records.
Some may try to produce affidavits from JDB employees who state that a certain amount is due. These may look all fancy, but they are about as valuable in court as toilet paper!
Unless they have an affidavit from an employee of the entity that lent the money, they are going to be out of luck.
Consider the alternative: Suppose I check my records and discover that I actually overpaid the account by $50,000. The company remit the balance due immediately, right? If I can’t produce any records to support that fact, I have no proof. Unless I can produce a company employee to testify to that fact, my claims are baseless.
If you find yourself up against a junk debt buyer, force them to validate and more often than not, they won’t be able to.
(Photo: sercasey )