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I’ve Been Sued by a Debt Collector – What Should I Do?

Other than a few traffic tickets, a debt collection lawsuit is most people’s first experience with the legal system and it can be intimidating. This article is designed the give you an overview of the lawsuit process and potential outcomes with the expectation that as you better understand what lies ahead, you will be less likely to make the worst mistake you can commit at this time -sticking your head in the sand and hoping it will go away on its own.

The Summons and Complaint

Summons & CompliantFor most people, the lawsuit process begins when you are served with a summons and complaint. The summons contains basic information about the administrative aspects of the suit including the court when the case was filed and some basic instructions. Probably the most important piece of information on the summons is the return date, or the date on which your creditor will win a judgment against you if you don’t take any action. The complaint sets out the basic argument against you and normally states the reason you’re being sued, the amount you’re being sued for, and the identity of the original creditor if the party suing you is a debt collector.

In some cases, there will be a couple of other blank forms given to you with the summons and complaint. One of the attachments is likely a list of questions about where you work and bank. These questions are designed to make it easier for the creditor to collect the debt in the event that it wins the lawsuit. Because of this, it’s generally best to avoid filling this form out unless you must. Knowing which list of questions you can ignore and which you must complete is the tricky part, especially given that the failure to complete and return court ordered interrogatories can result your being held in contempt of court and a bench warrant being issued for your arrest. Many times these forms will say optional or voluntary across the top, in which case they can be ignored. If not, or you have any question, fill it out and send it back or talk to an attorney.

Filing an Answer

Also attached may be a answer form that you can complete and return to the court setting out any reasons why you should win the lawsuit. If you plan on filing an answer, it would be wise to speak with an experienced debt attorney because they know how to draft this document in a way that minimizes the risk of the creditor using your words against you and increases the chances that the creditor will leave you alone and move on to an easier target. Regardless of whether you prepare your answer yourself or have an attorney do it, you’ll probably want to hold off on filing the answer for as long as legally permissible in order to give yourself more time to look at other options such as chapter 7 bankruptcy, chapter 13 bankruptcy, or debt settlement.

What The Debt Collector Can Do To You

If you don’t take any action or you move through the trial process and lose, the actions the creditor can take against you vary depending on the state you live in. The most common method to collecting on the judgment is a wage garnishment. About 25% of your take-home pay will be removed from your check each pay period until you’ve repaid the judgment amount, filed bankruptcy, or worked out some other arrangement with the creditor. Another popular form of debt collection is to seize the money in your bank accounts. Again, the amount they can seize varies depending on the laws of your state, but unlike a wage garnishment you can reduce the amount taken by simply limiting the amount you have on deposit. Other less common collection methods include repossession of secured assets and placing liens on property.

Get Help

If you’ve been sued by a credit card company or a debt collector, it’s not too late to seek help. Talk to a debt relief or bankruptcy attorney as soon as possible to avoid making mistakes during the lawsuit process, to learn how to protect your assets, and to come up with a plan on how to deal with your debt so you aren’t sued again.



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