Dispute a Debt That Was Sold: Documentation & Verification Tips

Getting a call or letter from a collection agency about an old debt can be confusing and stressful — especially when you don’t even recognize the company contacting you. That’s because your original creditor may have sold your debt to a third-party buyer, a common practice in the financial industry.

If that happens, it’s important to know how to dispute a debt that’s been sold and ensure it’s legitimate before paying a penny. Here’s a step-by-step guide to help you protect your rights and credit.

1. Understand What Happens When a Debt Is Sold

When lenders or credit card companies give up on collecting a debt, they often sell it to a collection agency for a fraction of the balance. The buyer then takes over the right to collect the full amount.

However, this doesn’t always go smoothly. Debt portfolios are sometimes inaccurate, incomplete, or outdated, which means you could be contacted about an amount you don’t owe—or one that’s already paid or too old to collect.

To understand the legal boundaries of this process, check out this guide on whether it’s illegal for a collection agency to buy your debt.

2. Request a Debt Validation Letter

Under the Fair Debt Collection Practices Act (FDCPA), you have the right to demand proof that the debt is yours. Within five days of first contact, a debt collector must send you a validation notice including:

• The amount owed

• The name of the original creditor

• A statement of your right to dispute the debt within 30 days

If you didn’t receive this letter, you can (and should) request it in writing. Never rely on phone conversations alone — always communicate by mail or email so you have a record.

3. Send a Written Dispute

If something seems off, send a debt dispute letter within 30 days of the initial contact. In your letter:

• State that you’re requesting verification of the debt

• Ask for documentation showing you’re legally responsible for it

• Request proof of the chain of ownership — who bought it from whom

Once your letter is received, the collector must stop all collection activity until they provide proper validation.

Tip: Always send your letter via certified mail and keep a copy for your records.

4. Review the Documentation Carefully

When you receive a response, review every detail. Confirm:

• The name and account number match your original records

• The balance is accurate

• The date of last payment (this determines the statute of limitations)

• The agency can prove they legally own the debtIf any information seems inconsistent or incomplete, you can dispute the debt again with additional evidence, or even file a complaint with the Consumer Financial Protection Bureau (CFPB).

5. Watch for “Zombie Debt”

Some collectors attempt to recover time-barred debts — those past the legal deadline for collection. They hope you’ll make a small payment or acknowledge the debt, which can restart the statute of limitations in some states.

If you suspect your debt is too old to collect, don’t agree to pay or enter any payment plan until you’ve confirmed its legal status.

6. Correct Errors on Your Credit Report

If a debt buyer has reported the account to credit bureaus, review your credit report for accuracy. Dispute any incorrect listings directly with Experian, Equifax, or TransUnion.

You can also attach copies of your validation or dispute letters to support your claim. Correcting inaccurate or duplicate entries can help raise your credit score faster than you might expect.

7. When to Get Professional Help

If your debt situation feels overwhelming or you’re unsure how to respond to collection notices, working with a credit repair expert can help. They can guide you through disputes, review your reports for compliance errors, and communicate with collectors on your behalf.

For reliable help and trusted information, visit Strong Credit Repair — a leading resource for credit improvement, debt education, and consumer protection.

Final Thoughts

Disputing a sold debt isn’t just about avoiding payment — it’s about ensuring accuracy, fairness, and compliance with federal law. Always ask for documentation, verify ownership, and never pay until you have written proof.

By knowing your rights and keeping solid records, you can protect your credit history and avoid falling victim to unfair collection practices.

For more insights on your rights when dealing with debt collectors, see this in-depth article on collection agencies purchasing debt and explore valuable credit resources at Strong Credit Repair.