Federal law prohibits a debt collector from communicating or threatening to communicate false credit information. This prohibition also includes the failure to communicate information that a debt is disputed. These and other prohibited debt collection practices are part of the Fair Debt Collection Practices Act. If you are a victim of such tactics, you have the right to sue the debt collector in federal district court or a state court. But because damages are limited---a maximum of $1,000 above your actual damages---your case may be better suited for small-claims court.
Step 1
Gather your records indicating that the debt collector, either an agency or individual, has communicated false credit information about you. Typically, this occurs when the collector gives false information to a credit reporting agency (i.e., Experian, Equifax or TransUnion). Examples of useful records are a copy of your credit report containing the false information and written communication from you to the debtor collector or creditor disputing the debt. Also include your own journal documenting phone calls regarding the disputed debt.
Step 2
Obtain information from your local county court regarding filing a small-claims case. This information is available from the clerk's office and, in many instances, can be found online. Jurisdictional limits vary from state to state for small-claims cases, ($3,000 in New Jersey and $5,000 in California, for example), which can help you determine where you should file your claim. If your actual damages plus the $1,000 maximum allowed under federal law is only slightly above the jurisdictional limit, you can always waive the excess amount of your claim in order to go through small-claims court, which is an expedited and relatively low-cost process.
Step 3
Prepare the preprinted small-claims court form required for starting your case according to the instructions accompanying the form. File the completed form with the court clerk and serve a copy of it on the defendant in a manner authorized by your court, which should also be provided in the instructions. Most small-claims courts permit the clerk to serve the form for you for an additional fee.
Step 4
Attend the hearing set by the court for your case. Bring your records to the hearing, with copies available for the judge and the defendant. Follow the judge's instruction on how to present your case. Although most small-claims court judges will rule on your case at the hearing, in some courts you may have to wait for the ruling to be mailed to you.
Tips and Warnings
- If you believe a credit reporting agency or a business reporting to the agency is providing erroneous information, the provisions of the Fair Credit Reporting Act apply. This law requires that you give the credit reporting agency an opportunity to investigate and correct the information before you can sue either the credit reporting agency or a business reporting to the agency.
- If you have suffered significant actual damages---$10,000 or more---your claim is well beyond the small-claims court jurisdiction, and you should seek the advice of a knowledgeable attorney to represent you. The provisions of the law can be complex and, although the debt-collection agency cannot use an attorney in small-claims court, you can be certain the agency will use an attorney to resist your claim.
Things You'll Need
- Records of false credit information
- Fair Debt Collection Practices Act
- Small-claims court forms
Member Comments