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How to Dispute a Debt You Don’t Owe

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In a Nutshell

Credit reports are supposed to be accurate, but it isn’t uncommon to find errors. Learn how to dispute misreported information.

Written by Attorney Jenni Klock Morel
Updated September 29, 2021

During a routine review of your credit report, you may discover an unpaid debt has been reported in your name even though it isn’t yours. You may even be receiving collection phone calls from a collection agency based on a debt you don’t owe. Credit reports are supposed to be accurate, but it isn’t uncommon to find incomplete or inaccurate information notated by the credit reporting agencies. 

Partially for this reason, it’s important to review your credit report regularly and to dispute any bad information contained in your credit history. Below, you’ll learn how to dispute misreported information. This piece will cover the basics of unpaid debts and debt collection accounts so you’ll be empowered to understand your credit report and determine your next steps, which may or may not include filing for bankruptcy.

Collection and Unpaid Debts

Unpaid debts often end up in collection. When you fall behind on making your monthly payments, your original creditor may hire a collection agency to pursue collection of that debt. Your original creditor may also sell the debt to a third-party debt buyer who will then attempt to collect the debt. If a debt you owe is sold, legally you will owe the entity that bought the debt (instead of the original creditor) – so long as the debt buyer can verify the debt and its purchase. 

When an account becomes delinquent after many missed payments, creditors want to get the bad debt off of their books. This is why credit card companies routinely “charge off” debts they don’t believe will be paid back. Debts that are charged off reflect poorly on your credit history. Note that just because they charge off a debt doesn’t mean that they’ll stop attempting to collect the debt from you through a debt collection agency. 

An account in collection will be noted on your credit reports compiled by the major credit bureaus. The three major credit bureaus are Equifax, TransUnion, and Experian. Collection accounts will generally remain on your credit history for seven years. This is true whether you pay the debt back or not. Collection accounts are considered negative information and the result is usually a reduced credit score. A lower credit score doesn’t mean you have “bad credit” for life. A lower score means that borrowing money or getting credit cards in the future may be harder and can come with higher interest rates until you work to lower your score again.  

Debt Collection Lawsuits

When a debt goes unpaid, the creditor can file a debt collection lawsuit against you. You will get served with a summons and a copy of the complaint. The summons is your official notice of the lawsuit filed against you and the complaint explains why you’re being sued and for what amount. 

A creditor has a certain amount of time to bring a lawsuit for unpaid debts. That time limit is outlined in a state-specific statute of limitations. If the lawsuit was filed after the statute of limitations has run, then you can have the lawsuit dismissed. The statute of limitations is determined by state law and is typically 3 to 10 years from the date of the first missed payment or the date of the last payment. Even if the lawsuit was filed within the statute of limitations, you can still defend yourself. Answering the lawsuit gives you time to negotiate a settlement with the creditor and possibly work out a payment plan that you can afford. 

If you ignore the lawsuit, your creditor can obtain a default judgment. This means that because you failed to respond to the claim, your creditor will automatically be granted a court judgment that says you owe the full amount outlined in the lawsuit. After obtaining either a judgment on the merits or a default judgment, your creditor will have a lot more power to take collection action against you. Once your creditor has obtained a judgment (or default judgment), you can expect them to levy your bank account or garnish your wages. A bank levy means that your creditor will seize money directly from your bank account. Wage garnishment means they will take money directly from your paycheck. After your employer is given notice of the garnishment order, they will be required to send a certain percentage of your paychecks to your creditor. 


The Fair Debt Collection Practices Act (FDCPA) is a federal law that is meant to protect your consumer rights from abusive debt collection practices. Generally speaking, the FDCPA protects consumers from abusive, misleading, or harassing tactics by debt collectors. Original creditors are not ordinarily bound by the FDCPA, but it does apply to third-party debt collectors and debt collection agencies pursuing consumer debts, not business debt. 

As a consumer, you have a number of protections under the FDCPA. When a debt collector contacts you, they are required to state that they’re a debt collection agency and provide you with their contact information. If they purchased the debt from your creditor, they must provide you with the name and address of the original creditor and the balance they’re claiming you owe. 

You have 30 days after a debt collection agency contacts you to demand verification of the debt. Within 30 days, you can send written notice to the debt collector that you’re disputing the validity of the debt. Based on your dispute letter, the debt collector is required to cease trying to collect payment on the debt until they obtain verification of the debt or a copy of a judgment and mail it to you. If they cannot verify the validity of the debt, they can’t legally continue collection activity against you. The Consumer Financial Protection Bureau (CFPB) offers sample letters you can take a look at. 

There are other things debt collectors can’t do, thanks to the FDCPA. A debt collector can’t legally:

  • Threaten to put you in jail for unpaid debts.

  • Use profanity or other abusive language while talking to you.

  • Harass you with repeated phone calls.

  • Call you before 8:00 a.m. or after 9:00 p.m. 

  • Threaten violence against you. 

  • Threaten to sue you unless they actually plan to and have the right to sue you. 

  • Continue to call you after you have informed them, in writing, that you no longer wish to receive phone calls. 

You have the power to get collection phone calls to stop. The Consumer Financial Protection Bureau (CFPB) has a sample letter entitled “I want the debt collector to stop contacting me” that you can take a look at. 

Reviewing Your Credit Report

Anytime you are pursued for a debt, you should request an updated copy of your credit report. You’re entitled to a free copy of your credit report from all three major credit bureaus every year. You can get your free credit report from AnnualCreditReport.com. This is the official site authorized by federal law to provide credit reports from the major credit bureaus. Note that due to COVID-19, the three credit bureaus are offering free weekly online credit reports through April 2021.

You should review all three of your credit reports from Equifax, TransUnion, and Experian. While they’re supposed to report the same information, this isn’t always the case. When reviewing your credit reports, look for any inaccurate information. Accounts you don’t recognize may be tied to instances of identity theft. You’ll also want to review collection accounts and ensure the validity and accuracy of those accounts, too. 

Fair Credit Reporting Act

The Fair Credit Reporting Act (FCRA) is another federal law meant to protect consumers, such as yourself. The FCRA requires that the information on your credit report be truthful and accurate. Any inaccurate information on your credit report must be removed or the credit reporting agency and the creditor may be subject to penalty. If the credit reporting agencies will not correct inaccurate information once it’s disputed, then you may consult an attorney about filing a lawsuit to enforce your rights.

Disputing a Debt

If you discover a debt on your credit report that you don’t owe or that is otherwise inaccurately misrepresented, it’s important that you dispute that debt. If you’re defending a debt collection lawsuit, you’ll need to file an answer to the suit that disputes the validity of the debt. Also, as soon as you’re notified of a collection account, you can request debt validation. It is then up to the collection agency to prove that you owe the debt. You only have 30 days to request verification of the debt from the original creditor, so make sure you do this as soon as possible after the first contact from a debt collector. 

Disputing the Debt on a Credit Report

You have the right to dispute any inaccurate information contained in your credit report. The dispute process is detailed on the credit reports when you pull them. Disputing a debt can be done easily by mail or online on the credit bureaus’ websites: Equifax, TransUnion, and Experian. Once the dispute process is underway, the credit bureau has a duty to investigate the validity of the debt you’re disputing. After a disputed debt is removed from one credit report, it should be removed from all credit reports. However, to ensure that you get the debt removed from all reports quickly, you should dispute the debt with all three credit bureaus.

If you are defending a collection lawsuit, you will need to file an answer disputing the same information. Hard copy dispute letters must be sent to a specific address and you should request a return receipt when you send such letters. A return receipt gives you proof of sending the dispute letter and proof of delivery. You should also send dispute letters to the address of the original creditor. Collection activity stays on your credit report for up to seven years. Because your credit can be harmed for such a long period of time due to a single collection action, it’s important to dispute the validity of debts that you do not owe. 

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What if I Owe the Debt?

If you are sued for a debt that you owe, you can still defend yourself. As long as you answer the lawsuit, you can attempt to negotiate a settlement amount and pay less than what you owe or work out a payment plan that you can afford. You may also raise defenses to the claim, including fraud or identity theft. If you ignore a lawsuit for unpaid debt, then your creditor can get a default judgment and then garnish your wages or levy money from your bank account. 

Statute of Limitations

As discussed above, a creditor must bring a lawsuit for an unpaid debt within a certain amount of time – known as the statute of limitations. A lawsuit filed after the statute of limitations has run will be dismissed as long as you assert this as a defense. Ignoring the lawsuit will not work. If you have a statute of limitations defense, you must answer the lawsuit and assert this defense for it to be successful. 

Each state sets its own statute of limitations, which range from 3 to 10 years for breach of contract/unpaid debt lawsuits. Another way to shut down a lawsuit for unpaid debt is to file for bankruptcy. 

Filing Bankruptcy to Eliminate Debt

Filing bankruptcy can stop a debt collection lawsuit that’s been filed against you. Bankruptcy can also erase credit card debt, medical bills, personal loans, and other types of unsecured debt. If you simply can’t afford to pay back your debts, then exploring how bankruptcy can help you isn’t a bad idea. If you have a debt problem and multiple debts, filing for bankruptcy protection may be the quickest way to get you the debt relief you need. Plus, bankruptcy creates uniform treatment of many debts on your credit report. The balance on all dischargeable debts – debts that are erased through bankruptcy – get zeroed out and reported as discharged in bankruptcy. With that said, filing bankruptcy isn’t for everyone. A good place to start exploring your options is by scheduling a free credit counseling session designed to provide you with personalized, professional debt management guidance at no cost. 


It’s necessary to review your credit reports to prevent inaccurate information from impacting your credit score and collection of debts that you don’t owe. Disputing debts is a fairly straightforward process. If your debt problem is more complicated than a few inaccurate debts appearing on your credit report, it may be time for you to consider all of your debt relief options. You can locate a bankruptcy attorney in your area who provides free consultations so that you can learn more about the debt relief options available to you. 

Upsolve.org is a nonprofit organization that offers a 100% free tool that thousands of low-income families across the country have used to file for bankruptcy without incurring attorneys’ fees. Check out our site to learn more about the bankruptcy process. 

Written By:

Attorney Jenni Klock Morel


Jenni Klock Morel is a writer, nonprofit leader, and Social Justice Law Scholar. For years she practiced consumer bankruptcy law exclusively as a debtor's attorney, helping individuals and families file for Chapter 7 or 13 bankruptcy protection. Jenni left the practice of law to... read more about Attorney Jenni Klock Morel

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