I was charged on a closed account for a service I never received. It is only a couple hundred dollars. I never paid it because it was not a valid debt.

I am trying to fix my credit. I called up the collection company ready to pay. They demanded I declare the debt is valid. I refused, saying the debt is not valid, that is why I didn't pay, but I'm willing to pay it off in full to fix my credit report. They refused to accept payment because I refuse to declare the debt is valid over the phone.

Is this still a valid debt or have they violated the FDCPA?

  • 17
    Admitting the debt is valid puts you on the hook to pay. Paying means the debt is valid, why would you pay an invalid debt? Paying a valid debt in collections doesn't remove it from credit report, but if the debt is invalid it should be removed as JohnFx described. They're just trying to get you to commit to the debt.
    – littleadv
    Jan 24, 2022 at 19:12
  • 4
    @littleadv Because paying off this $200 collections will boost my credit score to the point of saving 10's of thousands on a mortgage. Paying that off now instead of going through a 2-3 month removal process is a cost/benefit win for me. I got it off Experian for a 50 point bump but not the other two.
    – RobC
    Jan 24, 2022 at 19:42
  • 57
    Paying of a debt does not necessarily remove the negative mark from your credit report. If they say it will, GET IT IN WRITING! Debt collectors are notorious liars.
    – JohnFx
    Jan 24, 2022 at 20:15
  • 15
    I would suggest you should be trying to negotiate with the bank financing the mortgage, instead of the debt collector. The bank's loan officers are motivated to make you, personally, happy, since you're going to be paying them on the loan for 15 to 30 years. I'd lead off with something like "this is a $200 invalid debt dragging my credit score down and I'm in the process of disputing it, but that's going to take months, can we make a deal?"
    – zwol
    Jan 25, 2022 at 3:13
  • 3
    @JimMack: The present value they can sell the loan for is still related to that series of payments.
    – Ben Voigt
    Jan 25, 2022 at 23:13

4 Answers 4


It sounds like THEY don't think the debt is valid and want to validate it by getting you to claim it is. It might be worth sending them a letter asking them to prove the debt is yours or remove it. This is all credit repair companies do.

If they can't find proof then they have to remove it from your report. Paying the debt after claiming it is valid is not going to fix your credit.

Also, don't trust anything they tell you about whether it will be removed from your credit unless they provide it in writing. They WILL lie to you.

  • 35
    Debt collections are extremely predatory. There are things they do that will actually screw you over. One of them is making you claim that the debt is valid.
    – Nelson
    Jan 25, 2022 at 13:47
  • 19
    I strongly concur with the second sentence: Send them a letter requesting proof that the debt is (a) valid and (b) theirs to collect. There are plenty of examples around the Internet; use one of the polite examples and not one of the demanding examples. Unless and until they reply in writing, DO NOT claim the debt is valid. Jan 25, 2022 at 14:55
  • 1
    On top of this, in many places, if a creditor refuses a good-faith offer of immediate repayment, especially if there's not physical or technical reason why they can't accept it, then that's the end of it. You would need to be able to prove you'd made the offer though.
    – Perkins
    Jan 26, 2022 at 19:22
  • Google "FDCPA Act letter", use a polite example, but mail it Certified Mail Return Receipt Requested. The extra $5 postage is worth it if it goes another cycle.
    – user662852
    Jan 27, 2022 at 13:48
  • +1 Never trust anything that a debt collector tells you.
    – JimmyJames
    Jan 27, 2022 at 22:12

Transferring money to someone doesn't in itself make it their money. For that, a legal act needs to happen at the same time. This can either be payment to discharge an obligation, or gifting the money. We rarely pay attention to this, because it is generally clearly implied by the context what is happening.

If you simultaneously claim that you do not owe them anything, and transfer $200 to them, it is unclear what this is supposed to mean. If you have no obligation, it can't be to discharge the obligation. It doesn't make sense for it to be a gift either. You could intend to sue them later to get the money back.

What you want to do is to set up a contract with them specifying that they will forgive that debt if you should indeed owe it and (importantly) will remove any negative entry in your credit report; while you will pay them some amount of money (this amount could probably be less $200). Now when you transfer the money, it is to discharge the obligation from this contract.

  • set up a contract with them specifying that they will forgive that debt if you should indeed owe it...while you will pay them some amount of money- why should they drop the dept if OP actually owes the money (= the dept is valid)? Would you drop a valid dept of 200$ if someome came and gave you less than 200$, i.e. 100$? I really don't understand that part Jan 27, 2022 at 9:05
  • 1
    @ChrᴉzremembersMonica Money you actually have is worth more than money (you believe that) someone owes you. My understanding is that debt collectors overall only expect to ever recover a smallish fraction (varying by how bad of a debt they are going for) of the stated amount, and thus regularly accept deals like this.
    – Arno
    Jan 27, 2022 at 9:33
  • @ChrᴉzremembersMonica: debt is frequently bought and sold for pennies on the dollar. 50% return would be considered fantastic.
    – jmoreno
    Jan 27, 2022 at 17:16
  • The problem with this answer is that as soon as you accept the debt as valid it will be reported as such. That you paid it long after it was due doesn't mean much.
    – JimmyJames
    Jan 27, 2022 at 22:14
  • @JimmyJames Please read again what I have written.
    – Arno
    Jan 27, 2022 at 23:15

This is a bit of elaboration for Arno's reply, which sketches the solution but leaves out some detail (to my mind).

As Arno says, you can't settle a debt if you simultaneously claim you don't have a debt in the first place.

But equally, they can't demand money from you without proof its your debt, either.

So the solution is that you state to them, in roughly these terms:

Dear Sirs,

I note your letter of DATE claiming a debt of $AMOUNT for ITEM.

I will be glad to settle the debt, upon proof it is in fact mine to settle, and the debt is validly claimed against me.

In particular, please note my objection that the debt is not valid, because the service billed for was never provided to me, because the account had been closed before that time, and/or was provided against my instructions.

Please therefore provide proof and confirmation, not just that the debt is charged and sent to you for collection (which I accept is the case), but also that your principal is willing to testify in court on pain of perjury that the service was validly provided to me, before my account with them was closed, and is in fact a payment due for a service validly provided.

Alternatively, if the debt is not provably mine to settle, and/or cannot be proved valid to charge against me, I look forward to your confirmation that it will be removed from my records and the matter closed.

If you have a different or preferred way to resolve this, please let me know, since at present I am simply lacking any evidence that allows me to sign a legal document agreeing this is a valid debt, for reasons given. Such a declaration would appear to be perjury right now, and a false statement, hence the problem. Please therefore contact your principal and seek further directions before replying. [It is also possible that if you do not, then any consequential costs, expenses or other amounts may be recoverable from you. - check this sentence is correct for your area before including it]

I await details of proof of debt, and to settling this matter upon valid proof.

  • This reads more like an example of JohnFx's answer ("ask for proof") and not Arno's answer ("offer to pay less, in writing").
    – Bobson
    Jan 27, 2022 at 16:30
  • Aeno's first 2 paragraphs.
    – Stilez
    Jan 27, 2022 at 17:10

That was a strategic play on their part.

Their demand to "admit the debt" wasn't vanity, but a very wise legal strategy. If you admit the debt is valid, that restarts the clock on the statute of limitations. This greatly increases the cash value of the debt in the used-debt market. Huge win for them even if you don't promptly pay. Now they can sue you!

So this collector was brilliant. 90% chance you would have thought "what difference does it make since I'm about to pay it anyway?"

98% of the time when you try to engage with a collector via telephone, they will whip you. These are professional manipulators, trained to put you at the worst possible disadvantage in the law. Case in point.

Paying DOES NOT fix your credit!

I bet they implied that it would, but did not say it.

You suffer from a common misconception there. You think that a credit report is an "extortion" to force you to pay old debt. Not at all, and that would be kind of appalling, actually.

The credit report is an accurate record of how reliable you are for paying debt. You did not pay this for years, and that is a fact.

You almost changed that report to "did not pay for several years, and then finally paid". And since you would have acknowledged the debt (by paying it), that would have also restarted the clock on that credit mark. So it would be on your credit 7 years more.

Yes. Paying off old debt makes things worse.

Hey, I didn't design the system. I think it's a stupid system full of perverse incentives, that does not conform in any way to core human values of "be honest", "be fair" and "keep your word".

Since they have built this sick system and they game the system (in pursuit of filthy lucre above all), you too must game the system to get what is fair.

You must "make an offer they can't refuse".

It must be a written contract. The deal is "you pay, they remove the mark".

But, watch who your counterparties are. If you agree with the collection agency that they won't mar your credit, you don't have an agreement with the original creditor, who could continue to mar your credit. So you need to find out who actually holds your debt.

Anyway, the bones of an agreement are as follows:

  • Whereas there is a bill (identifying info enough to identify it, but no more) and saying HIPAA does not apply to this contract. That's throwing them a bone if it's medical related.

  • Whereas all of you recognize that there is a genuine disagreement as to the validity of the debt.

  • Whereas all of you desire a quick, final and no-fault resolution.

  • Therefore......

  • You all agree you pay $X to fully settle the matter. Paid in 30 days or entire agreement is void, but, statute of limitations restarts.*

  • Any payment whose purpose is unclear applies to this first.

  • This is the final resolution.

  • No-fault. Parties agree this settles matter in good faith. Settlement is for practical reasons, is not established as a valid debt, and any difference between amounts is not a canceled nor forgiven debt. **

  • Parites agree not to defame or disparage the other in any way, including and particularly that no adverse statements will be made to credit reporting agencies, and past statements disavowed.

  • Jurisdiction of law.

  • Severable.

  • Inseparable.

  • Counterparts.

You can do this as DIY legal, but it might be worth the time of a contract lawyer to get it right.

* Never miss an opportunity to "throw them a bone" (or some raw meat in this case) if it doesn't put you at disadvantage. Since you will pay, it is moot.

** This prevents an IRS problem: When debt is forgiven (owed $1000, pay $400) the forgiven ($600) is considered taxable income for you, and they can send a 1099 to the IRS and the IRS will want tax. By this agreement, they can't. That would be tax fraud if the debt was genuinely valid.

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