If you're being sued by a debt collector, your first reaction may be panic or fear. After all, these lawsuits typically come after a series of phone calls and letters that can be overwhelming if you're struggling financially. Unfortunately, your first instinct of ignoring the debt and the lawsuit can actually cost you in the long run. Here are some tips to help you understand how to deal with the lawsuit properly and possibly avoid bankruptcy.
Don't Ignore the Summons
If you ignore the summons, don't file a response and don't appear in court, the debt collector will win the case by default. This can cost you. Make sure that you file a response to the summons. The summons will include a response deadline.
File your response before this deadline to show the court that you want to resolve the debt. Responding to the summons also shows the collection agency that you're not going to be pushed around over the outstanding bill.
Issue a Challenge
Just because the collection agency filed a lawsuit, that doesn't mean that they have the necessary information to fully support the debt. Challenge the claim. If they don't have enough substantiating information to prove that the debt is valid and the amount is accurate, the debt collector may simply drop the case and try to work with you privately.
Remember that they hold the burden of proof because they filed the lawsuit. Ask for copies of the original credit agreement and any other supporting documents. Legally, they should have access to this. By requesting it, you put a spotlight on their requirement to prove the debt and your responsibility to pay it.
Talk with a Bankruptcy Attorney
A bankruptcy attorney can review the summons and tell you if it's within the statute of limitations and filed properly. In most states, creditors can only file lawsuits within a certain number of years after the debt was incurred. If the lawsuit is filed after that statute of limitations expires, the judge can dismiss the case.
Retain an Attorney
As soon as you receive that summons, reach out to an attorney. Many debt collectors hope to face the consumer on their own in court. By hiring an attorney, he or she will show the creditor that you're ready to fight the case. Sometimes, this will make the debt collector shy away in the interest of avoiding the court battle. This doesn't eliminate the debt though, so be prepared to settle that after the fact.
Dealing with debt can be overwhelming, especially if a creditor takes you to court. With the tips here, you can face that summons with confidence. Talk with an attorney to protect your rights, and ask about the possibility of filing Chapter 7 bankruptcy if your debts have grown beyond your means to pay.
To learn more, contact a company like http://wfactorlaw.com with any questions you have/