Today, I just had a case dismissed that had a lesson worth sharing. As with most debt collection defense cases, evidence is the most important issue. The case can take a much different path depending on whether the debt collector has evidence of the debt or if the debtor has evidence of payment or a defense. In this case, the debtor had paid the debt and kept the records of that payment. This turned the case from months of litigation to a pretty quick dismissal.
Most of the time, I encounter clients who make payments on their debts, but do not keep records of those payments. This is a mistake. Sometimes the debt collector will not account for payments made, and without proof of payment, it's very difficult to assert the defense in court. With the advantages of technology these days, its incredibly easy to keep long term records in case you are later sued on the debt. There are a few relatively easy steps to employ this strategy:
Scanner: First, get a scanner. Engadget has a great back to school guide that includes some all-in-one printer/scanner options.
Software: Next you need to get some software to scan your receipts, checks, bank statements, letters, and other documents concerning your debts. I like free options, so there are two programs I like. The first is CutePDF Writer. This is basically a pdf writer. The way it works is it will install as a printer just like any other, but instead of printing to paper, it prints to pdf. Very useful program. The other program is iCopy. This program will let you use your scanner to create the pdfs. Basically all you have to do is set CutePDF as your printer in iCopy. There's an article describing the process here.
Storage: You'll also need a good place to keep these records. I like online storage, that way, no matter what happens, a copy will be kept offsite. The two options I like are Dropbox and Sugarsync. If online isn't your thing, usb drives work well. Sandisk is a pretty good brand.
System: Finally, you need a system. Whenever you have a document needing scanning, scan it and save to your storage of choice. But don't give the file random names that will prevent you from ever finding them again, use a system. First, put the date in a format like Year-Month-Day so Windows will automatically sort them by date. Second include the name of the creditor the document references. Finally, include a short description of the document itself. For instance, let us say you pay a credit card bill online. You'll get a payment confirmation page at the end of the process. When you print it, print it to a pdf on your storage choice and name it "2011-09-28 Discover Credit Card Payment.pdf". If you have multiple accounts with the same creditor, you may want to add the last 4 digits of the account number to the creditor name.
I hope this was informational. I'm sure there are a ton of other ways people manage their records, feel free to share your system in the comments.