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Contesting A Debt Collection Lawsuit

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A debt collection lawsuit can be challenging, but thankfully, you don't have to face it alone. To successfully contest a debt collection lawsuit, it is important to understand the options you have for defending yourself. This article will provide you with possible strategies for success when you are up against a debt collector in court.

Why Should I Contest A Debt Collection Lawsuit?

If you are served with a debt collection lawsuit, the worst possible thing you can do is avoid it. You may think you can ignore the lawsuit, hoping that it will go away. This is just what the debt collector wants you to do, though. Your failure to respond can result in an automatic default judgment against you and a possible wage garnishment (where the collector gets money directly from your paycheck) or a lien on your property. Rather than try and hide from the collection suit, it's best to confront it straight on because you can win through various strategies.

Smart Strategies for Contesting A Debt Collection Lawsuit

The following strategies can help you protect your best interests if you are facing a debt collection lawsuit:

Respond To The Lawsuit And Defend Yourself

If a debt collector files a lawsuit against you, it is essential that you respond. You can either respond by yourself or through an attorney, but it must be done via a legal document called an Answer. This paper needs to be properly filed in the court where you are being sued as soon as possible. The summons that comes with the suit against you will include your timeline for responding.

It is not sufficient to respond through informal methods like the telephone; you must bring your response to the clerk of the court where you are being sued. In your Answer, you should not admit that you are liable for the debt as it is the creditor's burden to do so.

Within your response, you can defend yourself against the debt by claiming facts such as:

  • It is not your debt. You could be the victim of identity theft, or the debt could be a family member's or business account that isn't legally your responsibility.
  • You've already paid all the debt that you owe, or you've already included the debt in bankruptcy.
  • The amount the creditor lists your debt at is wrong. This could be because several of your payments haven't been credited, or the collector is charging too much in interest or fees.

Other, more technical defenses that a lawyer will be most helpful in raising are also available and listed below.

Challenge The Plaintiff's Right To Sue

The entity that owns the debt and is pursuing a lawsuit against you is legally required to show proof that they have a right to do so. If you don't respond, the court won't see this information. If you ask for the information during a hearing, the judge will likely enforce your request.

The plaintiff must provide all of the following information:

  • A credit agreement that you signed
  • Proof that the paperwork is accurate and came from the original creditor (documentation of the chain of custody).

If the plaintiff cannot provide this documentation, they may not have standing to bring the lawsuit, and the court will likely dismiss the case.

Ensure The Plaintiff Follows The Statute Of Limitations

The statute of limitations determines how much time creditors are allowed to bring a lawsuit regarding a debt. The statute of limitations varies by state and situation but typically ranges between four and six years.

The time usually starts on the last day you were “active” on an account, meaning you made a charge or a payment. Because making even the smallest payment can restart the statute of limitations on your debt, it's a good idea to seek legal advice before you agree to make any payment on a debt. For this reason, be extra cautious when a collection agency tries to get you to make even a small payment.

Ensure The Plaintiff Meets The Burden Of Proof

In debt collection suits, the burden to prove the case is on the plaintiff, who must prove all of the following elements:

  • You are responsible for the debt
  • They have the right to sue you
  • You owe a specific amount

Arguing that the plaintiff cannot prove the exact amount you owe could be a successful defense. You can also require the plaintiff to provide documentation that you opened an account.

Possibly, the plaintiff will not have access to such information because accounts often change hands many times before a lawsuit occurs. It's surprisingly common for this type of documentation to be impossible for creditors to provide promptly. This can result in a dismissal of the lawsuit or an agreement for a settlement at a much lower amount.

File A Countersuit

Creditors and debt collectors who violate either California law or Federal Law in their attempt to collect a debt may be responsible for both your legal fees and other monetary compensation for their improper practices in attempting to collect your debt.

File For Bankruptcy

If you choose to file a petition for bankruptcy, an automatic stay occurs, which will stop all debt collection during the bankruptcy proceedings. Bankruptcy will have a significant negative impact on your credit but, depending on your financial circumstances, can be the best way to clear your debts and rebuild your credit. It is important to hire an attorney who specializes in bankruptcy as soon as possible if you believe this path is the best for you.

How A California Debt Collection Attorney Can Help You?

Dealing with a debt collection lawsuit is undoubtedly stressful. Hiring an attorney to help you defend your suit will greatly relieve your stress and increase your chances of success. Our seasoned attorneys at Fitzgerald & Campbell have years of valuable experience in successfully defending debt collection lawsuits and have saved our clients from millions of dollars of debt. We are equipped with the extensive resources you need on your side to protect your rights and take control of your future.

To learn more about our comprehensive legal services, please reach out to our offices for a free consultation at (844) 431-3851 or contact us online today.