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Steps to Take If You Are Sued by a Debt Collector

Debt Relief Education / Debt Relief  / Steps to Take If You Are Sued by a Debt Collector

It can be scary to receive a letter that you are being sued by a debt collector. Different scenarios will probably be going through your head once you receive the letter, but don’t fret; it’s not a rare occurrence. There are different reasons why you are being hit with a debt collection lawsuit, one of which is if you have an old, unpaid debt. There are a few steps you can take to avoid getting into an even worse situation, and in this article, we will discuss them.

Review Your Debt

Gathering information on the creditor that is suing you is a good step to take. You should find out whether you really owe the amount they are asking for. Most times, debt may have been sold from one creditor to another – so the creditor suing you may not be the original debt collector. You should also check your own records and find out whether the debt is past the statute of limitations. Once you get the right information, you can file a response within 20 to 30 days from when the suit was filed.

Ignoring the Letters Is Bad

Ignoring the letters from creditors will have you going from a bad situation to an even worse one. Once you receive letters from a debt collector, it is essential that you respond as soon as you can – which is preferably before a lawsuit. If the debt collector has already hit you with a lawsuit, don’t ignore it as it will go forward with or without your presence. If you are not present in court to defend yourself, the judgment will almost certainly go against you – this will invariably limit your options.

Respond to the Lawsuit

It is very important that you respond to the lawsuit. However, this doesn’t mean that you should accept liability blindly even if you owe the debt –you have to be very cautious. Most times, debt collectors add fees and interests to the debt, so if you admit liability from the start, it will be difficult to settle for a lesser amount in court.

Rather than accepting liability, issue a response back stating that you are unaware of the debt and ask for a full account statement. This way, you’ll be more equipped when you go to court. Most debt collectors are willing to settle out of court as a lawsuit will cost them time and money. You can discuss a settlement offer with them before going to court – this way; you don’t have to waste any more money.

Consult with a Lawyer

Consulting with a lawyer is a good idea even if you eventually don’t hire one as they will give you insights on how to go about the proceedings. It is crucial that you know your options early on.

Wrapping It Up

If, after taking all the steps mentioned, the debt collector doesn’t agree to a settlement, ensure that you show up to court on the appointed date. This way, you can dispute your case with a judge present. Remember that if you don’t show up, the judgment will most likely not favor you.