What to Do if You're Being Sued by a Debt Collector
Getting sued by a debt collector can be an overwhelming and intimidating experience. You may be unsure of your rights, unsure of what the debt collector is allowed to do, or even unaware that the debt exists at all. Fortunately, there are practical steps you can take to protect yourself and respond appropriately to a debt collection lawsuit.
At Alpha Omega Law Firm, LLC, attorney Kelly Adams is committed to helping clients who’ve been sued by debt collectors. Here, she’ll explain what you need to know and do if you’re being sued by a debt collector, including how to verify debt, how to respond, what defenses are available, and when it’s time to seek professional legal help.
Don’t Ignore the Lawsuit
The worst thing you can do when sued by a debt collector is to ignore the lawsuit. If you receive a summons and complaint, ignoring these documents won’t make the lawsuit go away. In fact, it may result in a default judgment against you, allowing the debt collector to garnish your wages, freeze your bank accounts, or place liens on your property without further input from you.
Even if you believe the debt is invalid or already paid, you must respond to the lawsuit. Failing to do so gives up your opportunity to challenge the claim. You won’t be able to present evidence or tell your side of the story if you don’t respond. And once a judgment is entered, it becomes much more difficult, and sometimes impossible, to undo.
Verify the Debt
Before you admit to anything, take steps to verify the debt. Debt collectors don’t always have complete or accurate records. Sometimes they sue the wrong person, pursue expired debts, or rely on insufficient documentation. Verifying that the debt is valid and accurate is essential before moving forward. Here’s what you can do:
Request a debt validation: If you haven’t already received a validation notice from the debt collector, you can request one. This document should include the name of the original creditor, the amount of the debt, and your right to dispute it.
Review the complaint: Read the complaint carefully. Does it list an account number or original creditor that you recognize? Is the amount accurate?
Check the statute of limitations: Each state has a different time limit—known as the statute of limitations—for filing a lawsuit over a debt. If the deadline has passed, you may be able to get the case dismissed.
If something doesn’t seem right, this is the time to raise questions and consider your defenses. Don’t assume the debt collector has all the facts or legal standing to pursue the claim. Taking a proactive approach now can prevent costly consequences later on. Gather as much documentation as you can to support your position.
Respond to the Lawsuit
Once you’re served, you typically have a limited number of days to respond, often between 20 to 30 days, depending on your state. Missing this deadline can seriously jeopardize your case and limit your ability to dispute the debt. Your response is called an “Answer”, and it should include the following:
Admissions or denials to each paragraph of the complaint
Any defenses you believe apply (more on this below)
Counterclaims if the debt collector has violated any laws
You don’t need to write a long explanation, but your Answer should be clear, accurate, and filed with the court by the deadline. You must also send a copy to the plaintiff. If you fail to file an Answer in time, the debt collector can request a default judgment. Once entered, that judgment gives them powerful legal tools to collect the debt from you, including garnishment.
Understand Possible Defenses
Even if you owe the debt, there may be legal defenses that can reduce your liability or get the case dismissed. Some of these defenses are procedural, while others challenge the validity or enforceability of the debt itself. Identifying the right defense can change the outcome of your case, so it’s important to examine every detail carefully.
The Statute of Limitations Has Expired
Debt collectors can’t sue you for a debt that’s too old. The statute of limitations varies by state and by type of debt. If the debt is time-barred, raise this as an affirmative defense in your Answer. Courts won’t dismiss a case based on this defense unless you raise it, so you must bring it up in writing.
Mistaken Identity or Wrong Amount
Debt collectors may sue the wrong person, especially if they’ve purchased the debt from another company. Similarly, they may claim an incorrect amount due to interest, fees, or poor record-keeping. Review your credit reports and old statements if you have them. Cross-check the amount claimed in the lawsuit with your own records to spot discrepancies.
Lack of Standing
In many cases, the debt collector isn’t the original creditor. They must prove they legally own the debt and have the right to sue you. If they can’t provide a chain of title or a valid assignment, the case may be dismissed. Courts require that the party bringing the lawsuit has legal standing to do so; this means proving ownership through a clear paper trail.
The Debt Was Already Paid or Discharged
If you have already paid the debt or included it in a bankruptcy, provide proof in your Answer. Keep documentation such as receipts, emails, or discharge orders. A simple error or oversight by the collector could result in a lawsuit over a debt that no longer exists. Producing evidence of payment or discharge is often enough to get the case dismissed quickly.
Violations of the Fair Debt Collection Practices Act (FDCPA)
If the debt collector has engaged in illegal behavior, such as harassment, threats, or misrepresentation, you may have counterclaims under the FDCPA. These claims can sometimes offset the amount you owe or lead to dismissal of the case. Collectors who violate the FDCPA may be liable for damages and attorney’s fees.
Consider Settlement
Lawsuits are expensive and time-consuming for both parties. In many cases, the debt collector may be willing to settle the debt for less than the full amount, especially if you raise valid defenses. Settlement negotiations can also provide an opportunity to avoid a judgment on your credit report and regain control over your financial future. Here are some tips:
Don’t admit liability: When negotiating, be careful not to admit that you owe the debt unless you’re certain.
Get everything in writing: Before you agree to anything, make sure you receive the terms in writing. A verbal agreement isn’t enforceable.
Make sure the case is dismissed: If you settle, the agreement should include a provision that the debt collector will dismiss the lawsuit with prejudice, meaning they can’t sue you again.
Settlement may not be the right option in every case, but it can be a useful way to resolve the matter quickly and reduce stress. Before finalizing any deal, consider consulting a consumer debt attorney to make sure your interests are fully protected. Contact attorney Kelly Adams at Alpha Omega Law Firm, LLC, to discuss your case.
Know Your Rights
Being sued doesn’t strip you of your rights. Under federal and state laws, debt collectors must still follow legal rules and respect your protections. Just because you’re in debt doesn’t mean you should be subject to harassment, intimidation, or misinformation. Knowing your rights is key to defending yourself and potentially turning the tables on an abusive debt collector.
Federal Protections – FDCPA
The Fair Debt Collection Practices Act (FDCPA) is a federal law that sets strict rules for how debt collectors must behave when attempting to collect a debt. It was designed to protect consumers from harassment, deception, and abuse during the debt collection process. The FDCPA prohibits debt collectors from:
Calling you repeatedly or at odd hours
Threatening violence or arrest
Using obscene language
Misrepresenting themselves
Discussing your debt with third parties (other than your spouse or attorney)
If a debt collector violates your rights under the FDCPA, you may be entitled to damages and attorney’s fees. These violations can also strengthen your position in court or in settlement negotiations. Be sure to save voicemails, emails, letters, or any other evidence of misconduct; it could be vital to your case.
State Laws
Many states have additional consumer protections, including licensing requirements for debt collectors, lower interest rate caps, and stricter timelines. A local consumer protection attorney can help you understand the laws specific to your area. Some states also impose penalties on collectors who fail to comply with their regulations, giving you additional legal leverage.
Show Up to Court
If your case proceeds to a hearing or trial, show up, even if you’ve filed an Answer. Failure to appear can still result in a default judgment. When you attend, dress appropriately, bring documentation, and be respectful to the judge and opposing counsel. You may not need to say much, but your presence sends a strong message that you’re taking the matter seriously.
Speak With a Consumer Debt Attorney Today
Being sued by a debt collector is stressful, but you’re not powerless. By understanding the process, asserting your rights, and responding strategically, you can often reach a better outcome. Attorney Kelly Adams of Alpha Omega Law Firm, LLC, works with clients in Chadds Ford, Pennsylvania, and the surrounding areas to help them resolve their debt collection cases. Contact her office today to begin working toward financial peace of mind.
