When you fall behind on your debt, and your debt becomes aged, the creditor may hire a debt collector to recover debts from you on his behalf. He might also sell your debt to debt collection agencies or debt buyers. These debt collectors tend to use aggressive tactics to collect debts as quickly as possible. They also typically file lawsuits against consumers to pressure them into paying the money immediately. In short, if you have not paid off your debt, you are at risk of being sued by a debt collector.
If you are facing a lawsuit brought by a debt collector, you need to know the following:
Respond to the Lawsuit:
Don’t ever make the mistake of ignoring a lawsuit; you cannot make it go away by avoiding it. If you receive a summons and complaint and you don’t take action, there will be consequences. The debt collector can likely file a ‘request for the default’ which means you have forfeited your right to respond to the lawsuit and present your defense. A default judgment will be entered against you, and the debt collectors will automatically win the lawsuit. The judgment gives stronger tools to debt collectors to retrieve debt from you. The debt collector may be able to:
· Garnish your wages
· Freeze or garnish your bank accounts
· Put a lien against your property.
By not responding, you also lose the ability to dispute the claim that you owe a debt. Even if you don’t owe the debt or think you are mistaken for a wrong debt, do not ignore the lawsuit. When you respond or answer the lawsuit, the burden is on the debt collector to prove to the court that the debt is valid and that you owe the debt.
Verify the Claim:
After receiving the court notice, you must verify that the debt is yours and that the lawsuit is valid. There are situations where you may find that you actually don’t owe the debt and can come up with defenses to the lawsuit. Defenses may include:
· You have paid the debt. You have paid the debt, but the creditor or debt collector has not removed it from your account.
· The debt is time-barred. Your debts have a statute of limitation of 3 to 6 years, and you can be sued for not paying the debt within that time frame. If this limitation has run out, the debt collector can no longer bring a lawsuit against you.
· Identity theft: Someone stole your identity and has racked up a significant amount of debt using it. You are not liable to repay those debts.
· Bankruptcy: You discharged your debts at the time of filing for bankruptcy. Therefore, the debt is not yours, and the debt collector cannot pursue you for such debt.
Consider Settling your Debts with the Collector
Settling the debt might be a great option if you don’t have the financial means to pay the debt or if you don’t want to deal with the headache of a trial. Negotiate with the debt collector to settle the debt at a reduced amount. It can save you a significant sum of your money and prevent you from a court trial. Going to court can be costly to both you and the creditor. A settlement can be a win-win for both parties. Consider hiring a debt collection attorney with experience to help you with the settlement.
Speak to an Attorney
Last but not least, it is recommended that you seek legal representation when facing a lawsuit. An attorney might be able to guide you through the process and help you in:
· Understanding your legal options; debt settlement, debt defense, bankruptcy
· Negotiating a settlement plan with the debt collector
· Answering a complaint
· Preparing your defenses against the lawsuit
· Representing you in court
If a debt collector has filed a lawsuit against you, trust our debt collection defense attorneys at Tariq Law, P.C., to represent you against the lawsuit. Contact us at info@tariqlaw.com for a free case review.
