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Having to deal with debt collectors may be extremely problematic, draining, and frustrating. This kind of fear is unfortunately a reality for millions of Americans. Many debt collectors resort to litigation and lawsuits in addition to making incessant calls in an attempt to obtain the money they are attempting to collect.
In the event that you get a debt collection complaint, you should take aggressive measures to safeguard your rights. If you receive a summons for debt collection, you should attempt to learn more about what happens and how to successfully battle debt collectors in court. The following advice can help you defend yourself against a debt collector in court. Well, let's get started.
Collectors of debt can be frightening, as we mentioned. Additionally, it can be costly and equally stressful to hire a lawyer to represent you. Fortunately, you have the ability to advocate for yourself in court and outsmart debt collectors. You can prevail in your debt recovery case in the following five ways:
Let's now take a closer look at each of these steps.
You must reply to any summons and complaints that you may have received from a debt collector as soon as possible. In this case, disregarding the Summons and Complaint is one of the most frequent errors people make. Make sure to address the accusations, regardless of whether you believe you are being prosecuted in error or you owe the bill. An Answer is the legal word for your answer to the Complaint.
You should file your Answer as soon as possible since the debt collector will likely ask for a default verdict against you if you don't. Should the court issue the default judgment, the debt collector can deduct funds from your bank account, garnish your income, and even attempt to recoup legal expenses and other court costs.
It's also critical to respond to the lawsuit since it will provide you with a competitive advantage. A lot of debt collection agencies wager on consumers not submitting an answer and thus receiving the default judgment as previously stated. Numerous debt collectors are truly shocked when you reply to their lawsuit, and they could even be prepared to make a negotiated settlement offer to save money by not having to go to court. They may even decide to drop the case entirely.
You may have as few as 35 days, depending on where you live, to reply to your debt collection lawsuit. Filing an Answer is the first step to defeating the debt collector in court since it compels them to substantiate their claims.
The responsibility of proof is with the debt collector when they sue you. This implies that you are not required to put in the effort to support your position at the outset of the lawsuit. A debt collector's first and main requirements are to demonstrate that you are the debtor, that the amount of the debt (which incorporates interest and fees) is correct, and that you owe the bill to them and no one else.
The difficult aspect for debt collectors is this. Many debt collectors aim to collect the entire amount owed after buying old debts for a small portion of the original amount from banks, credit card companies, and other financial institutions. It is typical for them to be denied the paperwork required to establish their new control over the debt account when the debt is turned over to collection. They have no case if they don't have the proof.
The debt collector has to provide evidence for each allegation you refute in the complaint. In the event that a debt collector is unable to substantiate their allegations with actual documentation and proof of debt, they may even choose to drop the case.
You have the option to contest the debt collector's allegations against you by bringing up affirmative defenses in your Answer when they file a lawsuit against you.
Any legal argument that the debt collector's case is flawed or that you should prevail and they should lose is known as an affirmative defense. For instance, you ought to think about contesting the debt collector's right to sue you. When a debt collector is trying to collect on a past-due credit card, they must provide proof that they have the legal authority to do so, such as a copy of the acknowledged credit card agreement.
Since the debt collector does not have the "chain of custody" evidence necessary to bring you to court for the debt, you can ask the court to reject the collector's case if they are unable to provide this kind of proof.
You have other affirmative defense options besides this one. Rule 8(c) of the Federal Rules of Civil Procedure in the United States states:
“(c) Affirmative Defenses.
(1) In General. In responding to a pleading, a party must affirmatively state any avoidance or affirmative defense, including:
You can mention a variety of affirmative defenses in your response to a debt collection action, as you can see. These will make your argument stronger and make the debt collector put in more effort to demonstrate why they should prevail.
In most states, creditors have a specified period of time to attempt to collect on a debt through litigation. The statute of limitations has run out and the debt collector is no longer able to file a lawsuit for the debt after this period of time has passed. You can utilize this as an affirmative defense and probably have the case dismissed if it turns out that the debt collector charged you on a debt which has already passed the statute of limitations.
When it comes to debt collection, utilize the statute of limitations as a positive defense.
The statute of limitations differs depending on the type of debt and the state. Beginning on the day of the account's most recent payment, the debt clock begins to run. Thus, be sure you are aware of the statute of limitations on your debt before agreeing to pay a debt collector. You could risk restarting the statute of limitations if you don't.
The idea of appearing in court before a judge and jury can be rather daunting. Court, however, is not the only choice. An alternative dispute resolution process called arbitration may be able to settle the debt collecting action before it even reaches the courtroom.
Arbitration is an extrajudicial, private process. In a court matter, it entails a deal between the parties in dispute. One or more impartial people who have been trained to resolve legal disputes by hearing either side of the argument and examining all available evidence preside over arbitration. We refer to this person as an arbiter.
It is advisable to review your credit card policy if you are being prosecuted for debt. If it has an arbitration clause, you can drive the case out of court by filing a Motion to Compel Arbitration with your Answer.
Due to the high cost of arbitration and the fact that they typically bear all associated expenses, the majority of debt collectors are unwilling to participate. When debt collectors get a Motion to Compel Arbitration, they frequently cease collecting on the obligation. The strongest defense against a credit card claim may therefore be demanding arbitration.
In reality, a lot of debt collection companies are expert debt buyers. In other words, they buy accounts with charged-off debt from creditors for a small portion of the initial debt. Old debts are typically purchased by debt collectors for 4% of the total sum. They want to make a lot of money when they finally collect the entire loan. They typically do, too.
Nonetheless, most debt collectors are also ready to accept a settlement that is less than the initial amount because they buy debts for such a little portion of that amount. For instance, they should settle rather than risk entering into a protracted court struggle over the debt.
Facing a lawsuit from debt collection agencies can be overwhelming, but by understanding your legal rights and taking the proper steps, you can successfully challenge the claims against you. Remember, debt collectors rely on borrowers feeling powerless or uninformed, so staying proactive and informed is crucial.
You now know several effective strategies to defend yourself in court, including responding to the lawsuit promptly, demanding proof of the debt, invoking the statute of limitations, considering arbitration, and negotiating a settlement. The Federal Fair Debt Collection Practices Act (FDCPA) provides significant protections, ensuring debt collectors must follow strict rules when pursuing debt recovery. If they violate these rules, it could strengthen your defence or even result in their case being dismissed.
Before making any decisions, always review your debt history carefully, understand the specifics of your case, and consider seeking legal advice, especially when dealing with complicated claims. You don’t have to go through this process alone. Consumer protection agencies and legal professionals can offer valuable support to navigate your case successfully. Acting promptly and decisively gives you the best chance of defeating collection agencies in court.
Taking the right approach is key to protecting your finances and future. If you need help managing your debt or are considering outsourcing some of your financial services, look no further than Shepherd Outsourcing. We offer expert debt recovery solutions, compliance services, and operational support to businesses. Let our team help you streamline your processes, allowing you to focus on what really matters—growing your business. Contact Shepherd Outsourcing today and let us take care of the details so you can achieve your goals with confidence.
©2024 by Shepherd Outsourcing.