When facing a debt collection lawsuit, you will have many questions. You may wonder what is going to happen next, if you will be held liable and, if so, what consequences you will face. You may even question where the debt came from if you do not recognize it. It is for this reason we have compiled a list of the most common questions surrounding debt collection law, and the answers to them.
Can I Win a Debt Collection Lawsuit?
After a debt collector files a lawsuit against a borrower, sometimes the borrower thinks they will automatically lose the lawsuit. This is particularly true if they recognize the debt and understand that they are likely liable for it. To give yourself the best chance of winning a debt collection lawsuit, it is highly advised that you speak to a debt defense attorney. An attorney will challenge the debt collector on certain elements of the case, such as if the statute of limitations has expired on the debt.
Should You Pay Off Debt During a Lawsuit?
Many people wonder if they should pay off their debt while a lawsuit is ongoing, or wait and see if they have to pay it off at all. You should always try to pay off debt, even if you are facing a lawsuit. When determining how to pay it off, you have a few options. You can create a payment plan with the debt collector, you can pay it all off in one lump sum, or you can negotiate a settlement.
Settlements are often paid in one lump sum as well, but by giving the debt collector a lump sum, they will sometimes reduce the total amount you owe. Before offering to pay off the total amount in full, you should always try to negotiate a settlement, which an attorney can also skillfully do for you.
Can I Negotiate a Debt Settlement?
Although an attorney can negotiate on your behalf, you may choose to do it on your own. To do this, first, learn about the debt. That is the only way you can enter negotiations with a debt collector confidently. Find out everything about it, including when you took on the debt, the payments you have made on it, the principal amount, the interest rate, and anything else relevant to the debt.
Once you know everything about the debt, you should then create a repayment plan that is realistic and outlines how and when you will pay off the debt. Also, determine a settlement amount you could realistically pay. Do not tell the debt collector about the plan or the settlement amount. Just keep them in mind while negotiating with the debt collector.
Start negotiations by offering an amount significantly lower than the amount of the settlement offer you have predetermined. The debt collector will make a counter-offer and you will go back and forth in this manner until you reach a fair debt settlement.
Also, remember that you can negotiate more than just a fair settlement. You can also include agreements regarding how often the debt collector can contact you for the debt, or if they can contact you at all. Whatever payment or settlement plan you agree to with the debt collector, make sure you get it in writing and that you and the debt collector both have a copy.
What Is the Fair Debt Collection Practices Act?
One of the worst parts of being in debt is the fact that debt collectors call you repeatedly and may even harass you by calling several times a day, or calling late at night. The Fair Debt Collection Practices Act (FDCPA) prohibits much of this behavior. The FDCPA does not allow debt collectors to harass you or lie to you in an attempt to collect on your debt. The FDCPA applies to mortgages, credit cards, medical debts, or other debts incurred for personal or household purposes. It does not cover debts incurred by businesses.
How Did the Collection Agency Find Me?
It often seems that collection agencies can find people no matter what. This is somewhat true, because they use a number of different tactics to learn where you are. Once they have this information, they can then continue to call you and harass you in an effort to recover the debt. A debt collector may find you if they:
- Check your credit application: Collection agencies purchase bundles of debt from creditors for a small price that they recover when the borrower pays off the debt. When they buy the debt, the original creditor will also give the collection agency your credit application. This will likely list where you live and even if you have moved, it may have other information such as your employer or bank – either may be able to provide information about where you live.
- Relatives, friends, and neighbors: Collection agencies are not above calling your family members, friends, and neighbors to learn where you live. It is crucial to understand that these individuals are under no obligation to answer their questions, and this could even be seen as harassing behavior.
- Online records: The fact that just about any information can be found online is usually a good thing. When it comes to collection agencies discovering your location, though, that is not always the case. If a collection agency knows your phone number, they will typically use a reverse directory to find your address.
- Post offices: One of the most obvious and overlooked places a collection agency may find your address is by checking with the post office. There they may find a forwarding address you left after a move.
Due to these methods of learning your address, it can seem impossible to avoid debt collectors. If they have already started legal action against you, it is best that you not try to avoid them.
Our Florida Debt Defense Lawyers Can Help if You are Facing Legal Action
Learning that a debt collector has started legal action against you is very frightening. You do not have to go through it alone. At Loan Lawyers, our Fort Lauderdale debt defense attorneys can help. Our skilled attorneys know the many defenses available in debt lawsuits and how to use them to give you the best chance of success. Call us today at (954) 523-HELP (4357) or contact us online to schedule your free consultation to learn more about how we can help.
Loan Lawyers has helped over 5,000 South Florida homeowners and consumers with their debt problems, we have saved over 2,000 homes from foreclosure, eliminated more than $100,000,000 in mortgage principal and consumer debt, and have recovered over $10,000,000 on behalf of our clients due to bank, loan servicer, and debt collector violations. Contact us for a free consultation and find out more about our money-back guarantee on credit card debt buyer lawsuits, and how we may be able to help you.