Can I Sue? Credit Bureaus and Collection Agencies

Perhaps you've come up against a nasty blemish on your credit reports or a debt collector harassing you but you've hit a wall trying to resolve the issue.

If so, there's a time when you may need to turn to legal help if you've had trouble handling the problem yourself. But before you consider a lawyer to hire, consider Can I sue first.

Because credit bureaus and collection agencies must follow strict credit laws, there are actions you can take if your rights have been violated. Here's some tips on the best way to handle stubborn credit bureaus and collection agencies.

Credit Report Issues - Can I Sue?

If a credit bureau has refused to remove an item that is false or inaccurate, you can take legal action against them. Under the FCRA a credit bureau must report accurate information.

If you've disputed the item and the credit bureau maintains that the item is accurate and therefore going to remain -- yet you have proof saying otherwise, you can sue the credit bureau. Sometimes this action can be handled on your own simply by advising the credit bureau that you plan to take legal action. This may be enough for the bureau to finally pay attention.

Likewise, if the credit bureau is telling you that the furnisher of information (the creditor or collection agency) is the one confirming the item is accurate, then you can include them in your legal actions. Often times, simply informing the credit bureau that you plan to take action if the item is not removed will be enough for them to do a more thorough investigation to get the item off your credit reports.

If you decide to sue the credit bureau you can do so in small claims court. Damages of up to 1,000.00 can be awarded. The FTC has some lawsuit cases of success you can look at to get a clearer idea of where your problem falls.

We have an article on how to sue a credit bureau or sue a collection agency.

Debt Collection Issues - Can I sue?

Dealing with bill collectors is a task none of us like to handle but sometimes there is just no way around it. Perhaps a collection agency has been harassing you non-stop even though you've told them to stop with a cease and desist letter. Perhaps they continue to threaten legal action against you even though you've provided proof that the debt is paid or doesnt belong to you. Maybe you've tried to do validation of debt  but you've been completely ignored. These types of actions happen everyday around the world.

Before you hire an attorney, try to resolve the issue yourself using the tactics here. Rather than just phoning the collection agency or sending basic letters, step up your game. Advise the collection agency in writing (keep copies) that you believe they've violated the FDCPA and you plan to collect damages from them by taking them to small claims court.

There is no federal law that a collection agency has to be licensed and bonded but there are state laws. If a collection agency is operating in a state where it's required but they are not, you can use that information as leverage. You can check the state law requirements for collection agencies.

Seeking Legal Help

Finally, if you feel the issue is over your head and you need legal help, consider contacting the NACA for a list of consumer law attorneys in your area. The National Association of Consumer Advocates is a nationwide organization of more than 1,500 attorneys who represent and have represented hundreds of thousands of consumers victimized by fraudulent, abusive and predatory business practices.