The Importance of the First 30 Days (original content from ACA International)

Choose your words carefully when talking to consumers during the validation period. By Anne Rosso May The 30 days after a consumer has received an initial communication from your agency, known as the validation period, is a delicate time.

Under the Fair Debt Collection Practices Act, after consumers get a first notice—typically a letter—advising them of their right to dispute the validity of the debt, they have 30 days to do so. And while you may ask a consumer to pay within those first 30 days (assuming the consumer hasn’t disputed the debt), you can’t demand that the consumer pay within a timeframe shorter than the validation period in a way that conflicts with the consumer’s right to dispute.

This is known as overshadowing—when debt collectors say or do something to make consumers believe they don’t have the full 30 days to dispute the debt. For instance, telling consumers that payment should be made “today” or that the debt is due “right away” can be confusing, and may violate the FDCPA because you’ve lead consumers to believe that the rights as stated in your initial letter aren’t valid. For that reason, offering payment plans and discounts in this time period can be tricky, and you’ll want to pay close attention to the language you use when describing them to a consumer (if your agency allows you to offer them at all).

To reduce the risk of overshadowing, don’t offer consumers a settlement during the validation period that requires them to pay within that first 30 days in order to take advantage of a discount. If you do offer to let the consumer resolve the debt at a discounted rate, make sure the deadline for that offer extends past the 30-day period— and by more than just a few days. And once an offer is made, don’t withdraw it during the validation period. Even if your language doesn’t literally contradict the validation notice, creating an undue sense of urgency could cause a consumer to question her right to dispute the debt within the validation period, which would likely constitute overshadowing. Phrases like, “We request quick payment” and “This is an urgent matter,” even if delivered in a friendly tone, could trigger an overshadowing violation.

If at any point in the 30-day period the consumer requests validation, stop all collection activity until after your agency has mailed sufficient verification of the debt. Follow your agency’s policies and procedures on how to avoid overshadowing, which likely provide specific language for you to use, such as whether or not you should reinforce to consumers that they have 30 days to validate the debt.

Some agencies may want communications in the validation period to be more informative than collection-driven, telling consumers they should be receiving a letter from your agency and simply clarifying information you have on your system. If so, keep that in mind as you’re making your calls.

Anne Rosso May is editor of Collector magazine.