You certainly have a good shot of beating the lawsuit. As many as 90% of all plaintiffs in a credit card lawsuit have trouble proving that the defendants actually owe them money. To begin your defense, closely read the documents the credit card company sends you.
The good news is, you may have rights and you may be able to receive legal representation depending on which debt settlement company you are with, which could be a game changer for you. Concerned about going to court for credit card debt? We have your back.
Not all overdue credit card debts result in lawsuits. And when they do, frequently, the lawsuit is not filed within the statute of limitations. (A "statute of limitations" is the time limit set by law, which varies from state to state, that a creditor or debt buyer must bring a lawsuit to collect on a defaulted debt.)
You can defend yourself, but you need to know how. Debt has consequences, some of which will surprise the average American. For example, if you default on credit card debt the major consequence could be a lawsuit. Hold on. Can a credit card company sue you?
Calling From Unknown Numbers The "unknown number" trick is one of the oldest debt collector tricks in the book. Collectors feel that a debtor is more likely to answer a call if they disguise or hide their number. Therefore, they will often call debtors from unknown or private numbers.
Although debt collectors may use scare tactics in an attempt to make you pay your debt, their scare tactics are not always legal. Always refer to the FDCPA and report a debt collector using unfair scare tactics to retrieve your debt.
Making Threats. Debt collectors sometimes use threats to pressure people into paying a debt. ... Calling Neighbors and Family Members. ... Pretending to Be a Debt Collector. ... Making Harassing Phone Calls. ... Calling When You're Represented by an Attorney.
9 Ways to Outsmart Debt CollectorsDon't Get Emotional. ... Make Sure the Debt Is Really Yours. ... Ask for Proof. ... Resist the Scare Tactics. ... Be Wary of Fees. ... Negotiate. ... Call In Backup. ... Know the Time Limits.More items...•
Here are five illegal tactics used by unethical debt collectors:Pretending to be someone else. Debt collectors have to identify themselves and who they work for. ... Making threats. It's illegal to threaten anyone to try to get them to pay a debt. ... Contacting third parties. ... Calling at odd hours. ... Harassment.
Attempt to speak to the collector and explain yourself calmly and politely. If you are in the process of filing for bankruptcy, inform the debt collection agency and provide them with your attorney's information and a case number if possible. This will often stop any further calls for a time.
Once a default judgment is entered, the debt collector can garnish your wages, seize personal property, and have money taken out of your bank account. SoloSuit makes it simple to respond to a debt lawsuit the right way. As mentioned earlier, you can run, but you cannot hide.
You only need to say a few things:“This is not a good time. Please call back at 6:00.”“I don't believe I owe this debt. Can you send information on it?”“I prefer to pay the original creditor. ... “My employer does not allow me to take these calls at work.”
Tips for Improving Debt Collection CallsSmile during the call. ... Use the person's name during the call, but don't overdo it.Speak confidently, concisely, and never emotionally. ... Listen carefully but also use silence when necessary to keep control of the call.Stay calm, even if the customer gets upset.
Disputing the debt doesn't restart the clock unless you admit that the debt is yours. You can get a validation letter in an effort to dispute the debt to prove that the debt is either not yours or is time-barred.
Here's how to respond when you are sued for credit card debt:Don't ignore the summons. When you get a court summons for credit card debt, pay attention to it—and make a plan of action. ... Verify the debt. ... Consider debt settlement. ... Contact an attorney. ... Look at your budget. ... Request a payment plan. ... Make a lump-sum payment.
Your dispute should be made in writing to ensure that the debt collector has to send you verification of the debt. If you're having trouble with debt collection, you can submit a complaint with the CFPB online or by calling (855) 411-CFPB (2372).
The debt in question may not be yours. Credit card companies generally don’t want to take legal action unless you’ve made zero payments for about six months and ignored their calls. A lawsuit is a last resort.
After making sure that the debt in question is yours, check to see if it's "time-barred” or too late to sue you. Credit card companies only have a certain amount of time to bring a case in civil court. Depending on state law, this can range between 2–6 years. You’ll want to check your local rules to see what statute of limitations applies.
Did a debt collector harass you while trying to collect this debt? The Fair Debt Collection Practices Act (FDCPA) forbids lenders and creditors from engaging in fraudulent and deceptive behavior. They also can’t harass you by:
Credit card debts are discharged at the end of Chapter 7 bankruptcy proceedings. In “no-asset” cases, the trustee cannot take any assets because they’re “exempted” under state law. In cases of non-exempt assets, some of your property can be sold to pay creditors. However, this scenario is rare.
After you've considered the facts and know your defenses, find what type of court will be evaluating your answer or response to the complaint brought against you. In some states, for lower-level small claims courts, checking a box admitting or denying the claim may work for an answer.
Here’s what you should do: 1 Be intentional with your creditors (have your debt settlement company talk with them) 2 Settle with your creditor (get your debts resolved)
When a creditor calls your debt settlement company, they can pay close attention to your creditor’s complaint. And depending on how much you have saved up in your dedicated monthly savings account, they may be able to negotiate a settlement for you. Another word of advice is to be sure that the credit card company’s lawsuit is 100 percent accurate.
For those who are unaware, speaking to your creditor on the phone could result in them striking a deal with you. Pro tip: It typically takes 6 months before your debts are taking to collections. This could buy you enough time to save up enough to make a settlement before a lawsuit is considered.
If you do receive a lawsuit for your outstanding debts you could hire an attorney for legal help or have your debt settlement company handle your lawsuit if they offer that option to you. Although no one wants to take on a big bank in court, you do have certain rights to your assets too.
Because if you miss your day in court, the odds will automatically be stacked against you, resulting in you paying the maximum amount. For the uninitiated, credit card debt is unsecured, which means that you don’t need to have any collateral like a car or a home to be approved for one.
The truth is — in certain states, financial creditors are allowed to sue you over credit card debt. Now, that doesn’t always happen and every person’s financial situation can vary based on the creditors. However, if you do owe any significant amount of debt you still have a chance that your creditors could sue you.
If you really have a lawsuit on your hands, then you’ve often reached the last effort of the debt collection process. On the other hand, some credit card companies can decide to give up on their efforts and forward your account to a legitimate collection agency.
Here are some steps in answering the interrogatories for a credit card lawsuit: Before answering the first question, carefully review all the questions listed. Up to 25 questions can be listed by each creditor.
The credit card complaint should list numbered paragraphs with each paragraph stating a count against the consumer and listing facts per the creditor. After receiving the complaint, the defendant needs to answer his summons using each paragraph with a denial ...
Failure to answer the interrogatories regarding credit card debt or any lawsuit can result in a contempt charge from the court. Here are some steps in answering the interrogatories for a credit card lawsuit: 1 Before answering the first question, carefully review all the questions listed. Up to 25 questions can be listed by each creditor. Expect questions regarding employment, living arrangements, monthly expenses and bank account information. 2 Answer each question truthfully with basic answers. If a question does not apply, write “N/A” in the provided space, letting the creditor know that the question was not skipped. “N/A” also shows a refusal to answer. Making an objection to a question listed on the interrogatory requires permission from the court not to answer. 3 Locate the court address on the form and return the completed interrogatories within the allotted time frame. The interrogatory form should state how long you have to submit the answered questions, and typically the time frame will vary from 10-30 days. Be sure to get two certified copies from the court. 4 Mail one certified copy to the creditor, and keep one certified copy for personal records.
Debt collectors will contact a person for two reasons: if the debtor is behind in paying bills or the creditor’s records mistakenly make it appear that a consumer is behind on payments.
If a collection agency wants to buy defaulted accounts, they need to prove that they purchased the account as well as the amount they are suing for. Defendants have to watch these amounts, and make sure that they are listed accurately. Everything must be proven.
Unless proof of valid assignment is present, it is rare to see a third party debt collector sue a consumer.
If applicable, the defendant should let the judge/court know that the creditor never had them sign a valid contractual agreement with them and force the creditor to prove that they loaned the money which was in the bank or creditor’s possession before the supposed loan.
For example, if a collection agency is suing you for $4,000 related to a credit card account, you should ask for documentation that starts with the opening of your account and ends with the last activity on the account.
One way to respond to a debt lawsuit is to challenge the plaintiff’s right to file the lawsuit. By the time a debt reaches this point, it has often been sold—sometimes more than once. The entity that owns the debt and is pursuing a lawsuit against you is legally required to show proof that they have a right to do so.
Just a note: Even when your right to validation has been triggered and you send a request with 30 days of receiving the initial communication, debt collectors are not required to validate within 30 days.
If you owe a debt and can’t pay it and you’re experiencing other financial distress, bankruptcy might be the right option. When you file a petition of bankruptcy, an automatic stay occurs. That means that all debt collection activity must cease and desist while the bankruptcy is handled.
According to the Consumer Financial Protection Bureau, more than 70 million Americans have dealt with debt collectors, and around 25% felt threatened during their dealings with such agencies. The type of language some collection agencies use can spark fear.
The rules vary by state and even situation, but typically the laws provide a range between four and six years in most cases.
One thing that happens when you get served papers for debt is that the burden of proof rests heavily with the plaintiff. That means the person suing you has to prove:
There’s a sports adage that the best defense is a good offense. If a credit card company sues you, one strategy is to challenge its right to do so. It’s the plaintiffs’ responsibility to prove that you owe them money. Make them do it. Debt often gets sold, so ask for documentation of a credit agreement that you signed and proof that the paperwork is accurate and came from the original creditor. This can be done without a lawyer.
If you don’t show up for the court proceeding, the judge automatically rules against you and will order you to pay the full amount. Credit cards are unsecured debt — meaning there’s no collateral at stake, such as a home or car — so the lender has limited options for collection.
InCharge has credit counselors who can help reduce your monthly payments and get you out of debt even faster. With a debt management program, counselors can work with the credit card company to reduce the interest rate on your debt to 8% (sometimes better) and arrange a payment schedule that is affordable.
In 2019, the top debt collection problem was being pursued for a debt an individual didn’t owe. People frequently learn of collection efforts only after they are denied a loan or don’t get a job because of an outstanding debt on their credit report. A couple facts are interesting to note.
If you have five debts, that does mean you could get 35 calls – but you’d only have to have five conversations. The second part of the rule says that debt collectors are required to provide consumers a validation notice either immediately or within five days of contacting the person they believe owes the debt.
According to the Federal Reserve, U.S. credit card debt stood at $770 billion in early 2021. Understand, too, that credit card companies don’t sue capriciously. But if you fail to make the minimum monthly payment and carry a high balance, you’re going to get the dreaded phone call or court summons.
Understand: Bankruptcy has a considerable impact that can take years to recover from, but it can be a first step toward getting out from under overwhelming debt and move you toward rebuilding your credit. Talk to a lawyer immediately about whether filing for Chapter 7 or Chapter 13 bankruptcy is right for you.
A collection agency is more likely to settle your debt for less than what you owe because it bought your debt at a discount. The negotiation tips that follow tend to work best with a debt collector. You can get a better idea about the process by reading Delinquent Debt: What to Expect in Debt Collection.
A collection agency has bought the debt. After the original creditor charges off your account, you’ll remain responsible for the full value of the debt, but instead of paying the balance to the original creditor, you’ll pay the collection agency. A collection agency is more likely to settle your debt for less than what you owe because it bought ...
When you’re behind on a payment, your credit card company will likely attempt to collect from you for up to six months. If you don’t bring your debt current within that time, you can expect the original credit card company to “charge off” (sell) your debt to a professional debt collector for a discount.
If you’re not sure whether you should settle your overdue account or file for bankruptcy, you’ll want to consult with a professional. A bankruptcy attorney can assess your financial situation and determine whether you’d benefit from a Chapter 7 bankruptcy, a Chapter 13 bankruptcy, or debt negotiation.
People who regularly negotiate assume that you’ll start with a low number and gradually increase your offer—not start with the highest number you can tolerate. Therefore, don’t expect your opponent to be satisfied settling for your initial number.
Getting the Settlement Terms in Writing. Once you reach an agreement, you’ll want to get the terms of your settlement in writing before paying the settlement amount. The letter should state the amount the creditor will accept in satisfaction of your obligation and the date you must pay the funds.
Specifically, if the creditor gets a money judgment, it will already have the information it needs to take money out of your bank account (bank levy) or paycheck (garnishment).
If you don't, you are going to lose anyway. So fight. The reality is most debt buyers just don't have the proof they need and so they will drop the case and stop trying to collect on that old unenforceable debt. The reason for this has to do with the sloppiness of the data when a creditor sells a bad debt to a debt buyer or farms it out ...
But what is really happening is about 90 percent of consumers sued just never show up for court so they lose by default when they could have easily won and had the debt completely eliminated. Those folks are throwing away a perfectly good opportunity to make a debt go away because they are scared. If you have an old debt ...
There is no substitute for good legal advice so find a local attorney who is licensed in your state and spend some money to get good advice before you go to court. Otherwise you are just screwing yourself into a debt you never should have paid. Advertisement. Get Out of Debt Guy - Twitter, G+, Facebook.
A debt collection lawsuit begins when the collection agency files a “complaint” (sometimes called a “petition”) in court. The complaint will explain why the collector is suing you and what it wants—usually, repayment of money you owe, plus interest, fees, and costs.
Once the collector gets a money judgment against you, you might face wage garnishment, a bank account levy, or a lien on your property.
“ Discovery ” refers to the formal procedures that parties in a lawsuit use to get information and documents from each other to prepare for trial or settle the case. If you don’t raise any defenses or counterclaims, the collector probably won’t engage in discovery. But if you have a good defense or file a counterclaim, you and the collector might want to participate in discovery.
Generally, you’ll get around 20 to 30 days to file a written answer to the lawsuit with the court. You’ll have to respond to the allegations in the complaint and raise any defenses you have, like that the statute of limitations (the law that sets a time limit on the right to file a lawsuit) has expired, or counterclaims against the collector, such as violations of the Fair Debt Collection Practices Act.
To challenge a summary judgment motion, you’ll have to file paperwork opposing the motion. If you don’t, you’ll probably lose. Because the outcome of the lawsuit is at stake, you should seriously consider consulting with a lawyer, if you haven't already, if the collector files this kind of motion.
If the judge grants the motion, the court will enter a judgment against you without a trial.
If the judge grants the motion, the court will enter a judgment against you without a trial.