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Debt Collection Lawsuit: Your Guide to Handling the Process

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Debt Collection Lawsuit: Your Guide to Handling the Process

Owing someone something is never a good feeling. Getting sued for it is even worse. But hey, misery loves company. So in the face of a debt collection lawsuit, remember that more than 70 million Americans have gone through a similar situation, and there is a way out of this.

Now, getting served might be scary, but the law is fair. Know your rights, understand the process and present your side efficiently, and you’re sure to have a fighting chance.

So, let’s get you informed!

How Does a Debt Collection Lawsuit Begin?

When a creditor wants to collect, he files a lawsuit. When this happens, you will receive a notice or a summons. What this does is informs you of your transgressions and the lawsuit initiated against you.

When you do receive this summons, make sure you read it carefully. You may be directed to do certain things within a specific time-frame, and a failure to comply might have serious repercussions.

How Should You Respond?

It might be prudent to seek out assistance with a debt collection lawsuit, because the process itself is extremely nuanced, and you might find it helpful to have a lawyer to help you out.

While responding to the summons, there are a few things you need to keep in mind.

  • Do not admit liability if the specifics in the summons are wrong, or if you are unsure of the allegations
  • Question every vague statement in your summons
  • Choose your words very carefully
  • Check for evidence or “proof” provided, or “debt verification”. This means to ensure that the burden of proof has been met.
  • Examine the statute of limitations
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Know Your Rights

In every debt collection lawsuit, the lawyers in question are legally recognized as “debt collectors”. This means that they are under a legal obligation to follow the regulations under the Fair Debt Collection Practices Act. If you notice any violation of these regulations, you can even file a countersuit against them.

What Should You Look out For?

Communication: Inform you of the information coming from a debt collector, who they are representing and the balance you owe. They also need to inform you of your right to disprove the allegations, valid deadlines and your right to request valid proof.

Deception: Using trickery or deceit to abuse their power as attorneys. Some examples include misrepresenting facts, providing false information about the legal process, coercing you to make an uncomfortable decision for their personal gain.

If you suspect any such behavior or something does not sit right with you, be sure to consult your lawyer regarding the same. Read up on the act yourself, and ensure that the other side is playing fair.

The Last Resort

If you’re really caught up in financial debt and have no way to pay it off, you may have to file for bankruptcy. This will give you time to recuperate and get your finances back in order. A stay on any debt collection initiated through a debt collection lawsuit will give you time to rebuild your credit scores and start afresh.

However, it is a massive decision to make, so think it through before you do!

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