What to Do If You are Sued by a Debt Collector
When you’re up to your head in bills, it may seem impossible to keep making payments. But then what happens when creditors run out of patience and file the lawsuit against you? Here’s what to do if a lender sues you.
California Debt Collection Lawsuits
Debt collection lawsuits are the most effective way creditors can recover the money they are owed. When people fail to make payments as agreed, the creditor may have no other recourse than to file a lawsuit. When a debt collection lawsuit is filed, a debtor has the right to challenge the validity of the debt, as outlined in the Fair Debt Collection Practices Act (FDCPA).
The FDCPA protects debtors from debt collectors. This can include the debtor’s right to verify the debts that are in dispute. Not only does the FDCPA protect debtors from debt collectors, but it also protects crafty lawyers in debt collection lawsuits. Under the FDCPA, lawyers that represent a debt collector are also considered a debt collector, meaning they are required to abide by the same rules. What this ultimately means is that, either debt collector, or his or her attorney, must comply with certain collection practices or else they could get into serious trouble with the Court resulting in paying your fines and attorney’s fees and costs.
Prohibited Behavior
Some of the following things that creditors cannot do is:
Call you before 8 a.m. or after 9 p.m.
Call, write, or visit you at work, if your employer does not allow it.
Contact you while the debt is being verified.
Contact you if you tell the collector in writing not to contact you (the creditor can still sue).
Tell anyone else why the collector wants to get in touch with you.
Trick or threaten to hurt you, use bad language, or call too much.
Lie about the debt or about what happens if you do not pay. For example, they cannot say that you will go to jail if you do not pay, or that they will take a Social Security or pension check if you do not pay.
Contact you directly if they know you are represented by an attorney. Instead they must contact your attorney.
What to Do If a Debt Collector Sues You?
Respond in Writing ASAP
One of the first things you must do if you are facing a lawsuit by a debt collector or creditor is to respond to the lawsuit. This response can be made either by yourself or through an attorney, although it is always best practice to work with an experienced debt and bankruptcy lawyer. You must respond before the deadline in writing to the debt collector’s suit the court specifies.
Many people wrongly believe that if they refuse to accept delivery of a lawsuit when “served” that the process cannot continue. This assumption is incorrect, as merely ignoring the suit will likely result in the court considering the suit served, and a judgment made against you not only for the debt amount but also any additional court and lawyer fees for the plaintiff.
If a debt collector receives a judgment against you after you refuse to respond to a lawsuit, they may be able to garnish your wages, place a lien on your property, or seize funds from both your checking or savings accounts.
Seek a Compromise
When a debt collector or a creditor files a lawsuit for outstanding debt, what they are seeking is a legal remedy for you not repaying what you owe. What this means is that they are looking for a way to collect as much as possible from you. One way to respond to a debt collection lawsuit is to seek a compromise and begin negotiating a payment plan.
When you negotiate with a debt collector, it is essential that you do your homework first and devise a realistic payment plan. By fully understanding your debt burden, what you can afford to pay, and what a creditor will accept, you can create a program that is acceptable to all parties.
Once you formulate a payment plan, present it to your creditors. With the help of a dedicated bankruptcy attorney, you can explain in detail your financial situation, what you can afford to pay, and show evidence to prove your arguments. Then, you can begin negotiating a fair deal which satisfies the debt collectors want of payment, while saving both parties the cost and stress of a court battle.
Always Speak with an Experienced Attorney
Before you undertake any negotiations with a creditor or respond to a lawsuit, make sure you always discuss your case with an experienced bankruptcy attorney. If you are facing a suit for a creditor or debt-collector, don’t just talk to an attorney. Make sure you speak with the best. Speak to Iris Kwon, Esq.
At the Law Offices of Bankruptcy Near Me, we offer personalized attention to each of our clients because we know each situation is unique. If you’re thinking about filing for bankruptcy, or if your co-signer already has, having a leading attorney by your side can help you the protection you need.
Trust the bankruptcy lawyer who has handled over 1,000+ bankruptcy cases and we’ll work with you to help you get the best financial outcome. Trust in the expertise of Bankruptcy Near Me, LLC. Call us today at (301) 550-5408 for a free consultation.