The first step when you’ve been served with a debt buyer lawsuit

A debt buyer is a business that purchases delinquent accounts from the original creditor and then sues consumers to collect the debts. Because the debt buyer did not originate the debt, it is at the mercy of the original creditor to provide it with evidence to prove its case. In some cases, the original creditor doesn’t provide the debt buyer with any evidence of the debt. And when the original creditor does provide evidence, it often is just a single billing statement that was generated long after the account became delinquent.

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Although it seems ridiculous for debt buyers to initiate lawsuits without knowing what, if any, evidence exists to prove their claims, debt buyers nonetheless initiate thousands of lawsuits each month. Why? 95% of collection lawsuits proceed by default and result in judgments being entered against consumers without the debt buyer having to prove its case.  This basic premise is why collecting purchased debt is a thriving sub-industry. Debt buyers know that they can obtain thousands of judgments without having to produce a single piece of evidence.

If you are sued by a debt buyer, the first step is answering the lawsuit in a timely manner. An answer is a legal document that responds to the allegations in the complaint. If you are unsure how to do this yourself, contact a consumer lawyer immediately to help you. Failure to answer the lawsuit within the required time will likely result in a default judgment being entered against you without having an opportunity to go to court and defend yourself. But if you respond to a debt buyer lawsuit properly and engage in the ensuing litigation process, you will force the debt buyer to prove its case in front of a judge. Often they can’t.

(photo: maura)