06.23.11
The 5 Biggest Reasons You Should Never, Ever Throw a Collection Lawsuit Away.
Being served with a collection lawsuit can be tremendously stressful and even embarrassing. By the time you are sued, you have probably been dealing with debt collection letters and phone calls for months or even years. Dealing with a collection lawsuit, by this point, can be the last thing in the world you want to deal with. No matter how much you wish you ignore, don’t! Here are the five biggest reasons you should never, ever throw that collection lawsuit away:
1. The Clock is Ticking. Under the rules of civil procedure, you generally have 20 days to respond to a lawsuit. Once you are served, the clock is ticking. If you don’t formally respond to the lawsuit, the debt collector will get a default judgment against you. This means you will forfeit and the collector will automatically win the case. Most debt collectors are ready to file the papers to get the judgment against you on the 21st day.
2. A Judgment Gives the Debt Collector Powerful Remedies. Once a judgment is entered, the creditor/debt collector obtains powerful tools to collect. This can include: a lien against your house or other property, the right to “sweep” all of the money out of your bank account, and the right to garnish your paycheck. Debt collectors today use powerful tools to track people’s assets and sources of income. You may think that the debt collector will never find you. Think again! The collector probably sued you because they know who you bank with, where you work, or what property you own. You must make an appearance in the collection case to prevent a debt collector from obtaining the legal right to you’re money from your paycheck or bank account.
3. Once a Judgment is Entered, You Lose Your Ability to Negotiate. Over 95% of collection lawsuits result in default judgments- the debt collector wins simply because the consumer doesn’t respond. If you do respond, then the debt collector needs to actually prove you owe the debt. This means the debt collector’s lawyer needs to work. By defending yourself and raising appropriate defenses to the collection lawsuit, you increase your settlement position with the debt collector.
4. Once a Judgment is Entered, You Lose Your Right to Contest the Debt. Debt collectors sometimes sue the wrong person. They might not really own the debt, and therefore be the wrong party to bring the collection lawsuit. Or, by the time they file the lawsuit, it may be beyond the statute of limitations. These are all defenses that can be raised if a consumer responds to the collection lawsuit in a timely manner. We talk to people all of the time who would have won their collection case had they simply responded before the deadline. Talk to a collection defense lawyer before the deadline expires.
5. Once a Judgment is Entered, You Lose Your Ability to Bring Certain Claims Against the Debt Collector. If you are wrongly sued, or sued on a time-barred (past the statute of limitations debt), you may have strong claims against the debt collector under the Fair Debt Collection Practices Act. For example, we represented a consumer who was sued by a debt collector on a debt that was past the statute of limitations. Not only did we get the collection case dismissed, but we brought a claim on his behalf against the debt collector. A jury awarded him $250,000. Had he not answered the bogus collection lawsuit, he never would have been able to bring his collection harassment case in the first place!