CREDIT & LOANS
Dealing With Unsolicited Items
by Kimberly Lankford

I received a package in the mail that I did not order, followed by a bill. I didn't pay the bill, and now the company is threatening to send it to a collection agency. I understand that this is a common scam, but can it hurt my credit record?

Federal law prohibits companies from mailing unordered merchandise and then demanding payment. So you don't have to pay for it, and you don't have to send it back. But be sure you didn't order the item, perhaps by inadvertently joining a club that sends products periodically. Such deals are often disclosed in the fine print when you sign up to receive free trials.

If you're on firm ground, you don't have to do anything. But the Federal Trade Commission recommends sending a letter to the company by certified mail stating that you didn't order the item and that you have a legal right to keep it. If the bill goes to a collection agency and the issue winds up on your credit record, your letter will help you straighten things out.

Next time, mark the unsolicited items "return to sender." "You won't have to pay for anything, including postage," says Maxine Sweet of credit bureau Experian. "And you certainly have a strong argument that you shouldn't pay for it if you are subsequently billed."

If the dispute does end up on your credit record, it's best to try to solve the problem directly with the company or collection agency before contacting the credit bureau. They're the only ones that can remove the information from your credit record and verify the accuracy of its status, says Sweet. "They have both a legal right to provide the information to credit reporting companies and a legal obligation to ensure they are reporting it accurately," she says.

If you're still fighting with the company, then you can add a statement of dispute to your credit record explaining your side of the story. The FTC also recommends contacting your state or local consumer protection office, local U.S. Postal Inspector or the Better Business Bureau in your area for help. You can find contact information for all of these organizations at the federal government's Consumer Action Web site.