Debt Collection Defense

Debt Collection Defense

If you’re being hounded by a debt collector or you’ve received notice that a debt collection lawsuit has been filed against you, you are aren’t alone. Action taken against you related to debt can be intimidating, but it’s important to know you have rights and that debt collectors have limits.  This is where debt collection defense comes into play

A debt collector that files a lawsuit against you will have to prove the debt is legitimate and that they have the legal authority to collect that debt from you. In many cases, debt collectors buy and sell debt. The original creditor you worked with might have sold your debt long ago and several companies might have owned the debt by the time a lawsuit is filed against you.

It’s common when you’ve fallen behind on a debt to receive phone calls and letters from companies you’ve never even heard of.

Debt collectors, by law, must include information about the original creditor, the amount of the debt, and the account number whenever they contact you about the debt. You have a right to know the details about the original debt and understand the relationship the debt collector has to the original creditor, if any.

Verifying the Debt

The first thing you should do as soon as you are contacted by a debt collector is to ask for verification of the debt. This is true even if you are not being sued. Any time a debt collector contacts you make sure you ask for a verification letter.

According to the Fair Debt Collection Practices Act (FDCPA), if you send the bill collector a letter disputing a debt and/or requesting verification of a debt within 30 days of receiving the initial written notice of the debt (called a “dunning letter”), the bill collector must:

  • Immediate cease collection activity
  • Send you information verifying the debt

To verify a debt, the collector must provide a description of the amount you owe and the name and address of the original creditor. If a debt collector fails to verify the debt but continues debt collection efforts, you have the right to sue that collector in federal or state court. You could be entitled to $1,000, plus actual damages, attorney’s fees, and court costs. Any contact with you after you’ve requested verification and before you’ve received it is illegal and can not only be used in a debt collection defense in your favor, it can enable you to file a lawsuit of your own.

Keep in mind these requirements only pertain to debt collectors, not to the original creditor. If the original lender is trying to collect from you, requesting verification does not stop debt collection activities. It is only when a debt collector purchases debt from the original lender that these rules come into effect.

What You Can Do If You are Facing a Debt Collection Lawsuit

It’s understandable to feel intimidating if you’re facing legal action related to a debt. This process should not be undertaken alone.  Hiring a debt defense law firm on a flat fee is better than trying to navigate the Court system and the rules of civil procedure.

Dealing with a lawsuit, especially when there are verification issues, can be confusing. The average person has no idea where to begin when it comes to filing a motion or defending against a lawsuit. This is why an attorney can be such a valuable resource.

One of the best solutions to a debt collection lawsuit is to work out a settlement during the lawsuit.  This will eliminate any risk of leaving it up to the Court.  That being said, having an attorney will ensure you are signing a legitimate agreement.  Sometimes creditors will sue you again in the future if you did not have a valid debt settlement agreement.

We understand how overwhelming it can be to receive notice of a lawsuit related to a debt. We want to ensure your rights as a consumer are not violated. For more information or to speak to someone about building a debt collection defense, contact us at 1.800.220.4318.

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