Lawsuits

Lawsuits and What to Do 

If a debt collector files a lawsuit against you, a summons and complaint will be delivered to your home. The summons notifies you of the hearing date for the case, while the complaint lists the charge. You have the right to file an answer to the complaint with the court listing your reasons for not paying or denying any knowledge of the debt.

Timeframe

Once you are served with the notice of the lawsuit you will have 30 days to answer the lawsuit.  That means you will have to go to the court that the suit was filed in and file your response to the suit.  If you fail to do this the creditor will obtain a default judgment and will automatically win.

Misconceptions

You may believe that once you receive notification of the lawsuit that nothing can stop the case from going to court. This, however, is not true. You have the option to contact the debt collector and work out a payment plan to stop the lawsuit from occurring.

Considerations

  1. If you decide to fight the lawsuit in court, you can demand that the debt collector provide proof that you legally owe the debt.
  2. One legal option you have if you are sued over a debt is to do nothing. If you do not respond to the summons and complaint and do not appear in court, your creditor will win a judgment by default. Once the creditor has a judgment they then have the right to garnish your wages or bank accounts.

How Bankruptcy Can Stop a Lawsuit and Remove a Judgment

Filing for bankruptcy protection will stop collection lawsuits from continuing against you.  In addition, bankruptcy will terminate garnishments as to wages earned after the filing of the bankruptcy.

Wages earned before the filing may be recoverable from the sheriff or the creditor  if those wages would otherwise have been exempt.

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