Portfolio Recovery Default Judgment
Portfolio Recovery Associates LLC is a debt buyer and like most debt buyers, the company doesn’t always act in the most ethical manner.
If you are faced with a lawsuit from Portfolio Recovery or the court has granted the company a default judgment against you, what do you need to know?
The most important piece of advice anyone can follow, whether they have just received notice they are being sued or Portfolio Recovery has a default judgment against them, is to not ignore the problem.
If you’re like many people with debt, you’ve gotten into the position you’re in for one of the two reasons: you were either faced with an unexpected expense such as a medical emergency that resulted in a debt too big to handle or you fell behind and ignored the problem. In both cases you have options and one of them is to do nothing. You can ignore the medical bill or continue ignoring the credit card debt until there is a default judgment and then do nothing once Portfolio Recovery has access to your bank account and other assets.
Your other, better option is to take action as soon as possible. Whether you’re lost as to what you can do to combat a medical debt or you’ve been ignoring a problem and you’ve realized it wasn’t the right way to go, now is the time to take action.
Action before a judgment allows you to avoid all the problems that come with the court’s decision. A judgment can make your life miserable and cause:
- Difficulty selling your home because of a clouded title
- Garnished bank accounts and seizure of all of your non-exempt funds in those accounts
- Seizure of non-exempt property
- Serious damage to your credit that remains for a decade or more
Not to mention the day-to-day stress you’ll feel and the secondary problems you’ll face when you have a judgment hanging over your head that allows a debt buyer into seemingly every area of your life.
No matter where you are in the process – on the verge of being sued or facing a default judgment – there are things you can do.
What Should You Do If Portfolio Recovery Gains a Default Judgment Against You?
First of all, you can take comfort in knowing you are not alone. The vast majority of people who are sued by Portfolio Recovery Associates and other debt buyers fail to respond to the lawsuit and end up dealing with a default judgement.
Your first option is to ask the court to set aside the judgment. If you believe the default judgement was in error you can ask that it be set aside and you’ll be given a second chance to fight the lawsuit. There are generally six reasons a court will set aside a judgment, including:
- Mistakes (judgment must usually be within 30 days)
- Newly discovered evidence (within 30 days)
- Judgment is void
- Judgment has been satisfied, released, or discharged (as it would be if settled or if the debtor filed for bankruptcy)
- Any other reason justifying the judgment’s release
It will help to work with an experienced legal professional if you decide to ask the court to set aside the judgment. Even if you aren’t sure setting aside the judgment is an option, you can speak to an attorney to be sure. Getting a judge to set aside a judgment is challenging, but with the help of an expert it might be possible.
Settle the Judgment
Your second option is to settle the judgment. Just as you could’ve done prior to the judgment, you might still be able to settle the judgment for less than what you would be forced to pay based on the judgment.
For instance, if a default judgment has been granted and Portfolio Recovery Associates has been granted access to your bank account, they will likely deduct as much as they can every month to compensate the debt. So let’s say they get permission to take $500 from your bank account every month.
Though the judgment gives you less leverage than you had beforehand, Portfolio Recovery knows they are still at risk for getting their $500 a month. Should you lose your job or have any other experience that results in the money not being in your account, they lose out. Because of this, they might be willing to accept a lump sum settlement that guarantees them a certain amount. Granted, this amount will likely be more generous than they’d have accepted before the judgment, but it’s still less than $500 a month for the indefinite future – not to mention it gets the company out of your bank account.
If paying a lump sum settlement large enough to satisfy Portfolio Recovery, another option is filing for bankruptcy. This can be especially helpful for dealing with default judgments, especially when there are other debt issues in addition to the Portfolio Recovery debt.
Filing for chapter 7 bankruptcy stops bank account levies, as well as all other debt collection efforts. This means you’ll not only prevent debt buyers from accessing your accounts, you’ll also be released from the daily hassle and frustration of debt collection efforts. No more phone calls, no more texts, no more dreading getting the mail every day – all of it stops when you file for bankruptcy.
Chapter 7 bankruptcy offers a long-term solution for debt, too. There’s a good chance the Portfolio Recover default judgment will be discharged in the bankruptcy, as well as the rest of your other unsecured debt.
If you’d like to know more about what to do about a Portfolio Recovery default judgment or you have questions about whether bankruptcy can help, contact 1.800.220.4318 for more information.