Chances of Winning a Credit Card Lawsuit

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Being sued over credit card debt can feel overwhelming, but you may have a chance to win the lawsuit depending on several factors. The likelihood of success depends on who is suing you (the original creditor or a debt buyer), the judge handling your case, and the evidence presented.

This article explores these key factors and offers guidance on improving your chances of a favorable outcome.

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Who is Suing You? Original Creditors vs. Debt Buyers

The chances of winning a credit card lawsuit often hinge on whether the plaintiff is the original creditor or a debt buyer. Each scenario presents different challenges.

Original Creditors

Who They Are: These are the banks or financial institutions that issued the credit card (e.g., Capital One, Discover, or Citibank, JP Morgan Chase, American Express).
Why They’re Harder to Beat:
- Access to Documentation: Original creditors typically have detailed records of your account, including signed agreements, account statements, and payment history.
- Better Resources: They are well-funded and often represented by experienced attorneys.
- Stronger Legal Standing: Because they were directly involved in issuing the credit, their claim to the debt is more difficult to dispute.

Strategies Against Original Creditors:

Focus on Procedural Errors: If the creditor fails to follow proper procedures, such as failing to produce enough documentation, then the chances of winning the lawsuit may increase.
Negotiate a Settlement: Original creditors are often open to settlements to avoid lengthy litigation. This is often the best solution when sued by an original creditor.

Read Which Credit Card Companies Sue the Most

Debt Buyers

Who They Are: Debt buyers purchase charged-off debts from original creditors for pennies on the dollar. Examples include Portfolio Recovery Associates, Midland Credit Management, LVNV Funding LLC and Cavalry SPV I. Velocity Investments LLC and Jefferson Capital Systems.
Why They’re Easier to Defeat:
- Lack of Documentation: Debt buyers often acquire minimal account information when they first purchase the debt and may struggle to provide sufficient evidence to prove their case.
- Chain of Title Issues: Debt buyers must show a clear chain of ownership from the original creditor to themselves, which they often cannot do. The burden is generally on the Defendant to make these arguments to the Court.
- Volume-Based Lawsuits: Debt buyers file lawsuits in bulk, leading to potential mistakes or incomplete filings. They often robo-sign affidavits when preparing the cases for litigation.

Strategies Against Debt Buyers:

Challenge The Chain of Title: Require the debt buyer to prove they own the debt and have the right to sue.
Demand Documentation: Request a copy of the original credit agreement and a detailed account history. They should have bill of sales and other transfer documents from the original creditor. If they can’t produce it, you may win the case.

How the Judge Affects Your Chances

Judges play a significant role in the outcome of a credit card lawsuit. Their decisions on procedural matters, admissibility of evidence, and legal interpretations can heavily influence your case.

Familiarity with Local Court procedures

Judges will likely have their own specific local rules in addition to the rules of civil procedure. You will need to familiarize yourself with these rules.

Procedural Enforcement

Some judges strictly enforce procedural rules, such as deadlines and evidence requirements. If the creditor makes mistakes, a strict judge may dismiss the case.

Judges Opinion

Some judges take the position “do you owe the debt or not”. If the Judge has this mindset they are likely creditor friendly and the chances of success are slim. They may not be concerned about the evidentiary arguments or chain of title arguments. While it may be true you owed a debt to an original creditor, there may be arguments that cast doubt about whether or not the debt buyer has the right to sue.

Tips to Improve Your Chances of Winning

If you have been sued by debt collector, it means they has taken legal action against you in an attempt to collect a debt that they claim you owe. When you are sued by a debt collection agency, it is crucial to take the matter seriously and respond appropriately when being pursued by a Creditor for unpaid credit card debt.

Don’t Simply Ignore a Debt Collection Lawsuit:

Ignoring a lawsuit will result in a default judgment against you, potentially leading to garnishment of your bank account or wages, depending on state laws. A lawsuit is far more significant than a simple collection letter, as it involves a court process that could allow the creditor to seize some of your assets or place a lien on your property.

They can file lawsuits in District Court or lower courts. A debt lawsuit is much more serious than merely having a negative mark on your credit report. A low credit score is not nearly as critical as a default judgment for not responding to a debt collection lawsuit. You must have a debt collection defense strategy.

Retain an Attorney on a Fixed Fee

When Velocity Investments takes legal action against you, navigating the court process for a debt claim can be complicated. Getting legal advice is crucial. Additionally, you will likely need to appear in court one or more times. If you hire an attorney, they can often appear on your behalf.

Opt for an attorney who charges a flat fee to avoid the potentially high costs of hourly billing. Being a defendant in a debt collection lawsuit is not an enjoyable experience, and knowing the fixed cost of legal representation can help alleviate some stress.

Responding to a Complaint:

If you are sued by a plaintiff debt buyer such as Velocity Investments over an alleged debt, you must file an answer with the court within a specified deadline, typically ranging from 14 to 30 days from the date you were served. The exact deadline depends on the court where the case was filed. In your answer, it is crucial to generally deny the creditors allegations; otherwise, you may inadvertently admit to owing the debt.

List Defenses:

A Velocity Investments lawsuit requires a response, just like any lawsuit for bad debt. In your answer, you can also assert any valid defenses you may have, such as disputing the debt’s accuracy, claiming the debt is past the statute of limitations, or arguing that you’re not the responsible party. As the defendant, you must properly assert your defenses. The creditor may not be able to show adequate documentation from the original creditor. If so, you need to explain this to the judge as the defendant.

Prepare for All Court Dates

When a debt buyer sues you for credit card debt, the court will set deadlines and schedule hearings for your case. It is essential to attend all hearings and meet all deadlines. Hiring an attorney who specializes in debt lawsuit defense can be very beneficial. Legal advice on consumer protection can greatly assist in defending against a debt collector in a debt collection case

Read Court Orders Carefully

Adhere to any court orders or rulings. Failing to do so can lead to further legal consequences. This differs from the debt collection laws that creditors must follow before filing a debt collection lawsuit. You need to read every order carefully and also search for any specific local rules of the Court.

Gear up for Trial

A debt collection lawsuit often proceeds to trial if negotiations fail. Collaborate with your attorney to prepare a strong defense and gather evidence to support your case. Obtaining sound legal advice is crucial when facing a debt collection lawsuit filed by an agency or original creditor. Often, they may not provide sufficient documentation from the original creditor. As debt buyers, they are required to present specific documentation at trial.

Consider Settlement to Avoid the Risk of Trial

Even if the creditor has produced lackluster documentation, settlement should still be considered because some judges simply aren’t concerned with the evidence. They may take the approach of “did you have a debt or not” as opposed to whether or not the debt buyer has met their legal burden to prove their case. Unfortunately this risk is something that is difficult to overcome and thus settlement should usually always be considered regardless of the evidence presented.

Bankruptcy Options

If you have multiple debts bankruptcy might be a viable option. Bankruptcy can relieve you of your obligations from debt collection lawsuits and other bad debts, including credit card and other consumer debts. At Weston Legal, we offer a variety of debt relief options in select jurisdictions. Contact us to see if we can assist with your situation.

Conclusion

The chances of winning a credit card lawsuit depend on several factors, including whether the plaintiff is the original creditor or a debt buyer, the judge handling the case, and the strength of the evidence presented. Original creditors are harder to beat due to their access to documentation, while debt buyers may struggle more to prove their claims. By understanding your rights, responding to the lawsuit, and challenging the evidence, you can improve your chances of a favorable outcome. If you’re unsure how to proceed, consulting with a debt relief law firm can help you build a strong defense and navigate the legal process effectively.

Mike Weston, Esq.

Mike Weston is a seasoned debt lawsuit defense attorney and founder of Weston Legal. Since 2005, Mike has devoted his career to compassionately helping consumers struggling with issues involving their personal and business debts. Mike is grateful to have been able to help tens of thousands of clients become empowered with knowledge on the path to financial stability.