What Happens if I Ignore a Collection Lawsuit because “it’s Illegal for a Debt Buyer to Sue Me?”


What Happens if I Ignore a Collection Lawsuit because “it’s Illegal for a Debt Buyer to Sue Me?”

What Happens if I Ignore a Collection Lawsuit because "it's Illegal for a Debt Buyer to Sue Me?"Often we hear consumers say that they thought it was illegal to buy debt, or that it’s illegal for the collector who bought your debt to sue you.

Because of that belief, they do nothing about their collection lawsuit.

The problem is that a very real and legal judgment will be against them if they choose to ignore it.

This is called a “default judgment” and this is terrible.

Default, consent, and summary judgments have one thing in common: they’re all judgments. That’s bad.  Judgments lead to garnishments and the selling of your real property in a sheriff’s sale.

Let’s go back to the question of whether it’s legal to buy debt.

It’s legal to buy debt.

Let’s say I have a carton of milk. You may pay me $2 for the carton of milk. If I drank some of the milk, though, you may not be willing to pay as much for it.

That’s how it works with debt collectors.

Let’s say you owe Chase Bank $5,000. Chase Bank may sell that debt to a collector for one to five cents on the dollar. The collector may pay $100-$250 for that debt. Some collectors may even buy the debt for $20.

Just like our example, the collector will not pay the full price for a secondhand debt.

It’s also legal for the collector to sue you for the debt

…As long as they truly bought the debt. 

It’s amazing how many cases we’ve handled where the judge asks the collector to provide the evidence they own the debt, and the collectors have nothing.

Or they will say they have plenty of evidence with a huge document or agreement, but refuse to let the judge look at it. They will give 1 of the pages to the collection lawyers, and when we look at that page we ask where they rest of the agreement is.

The collection lawyer will argue that the document is so secret, the debt collectors won’t even let their lawyer look at it. Much less let us or the judge look at it.

Our response is, who cares? You sued my client based on the fact that you bought their debt. You need to prove that you own it. Bring all the evidence you can.

The collectors despise that.

It’s perfectly legal to buy debt and sue for it, if the collector truly owns the debt and can prove it. Not just that the consumers owes it, but that the collector owns it.

We hope this was helpful to you!

If you have any questions, you can reach us by phone at 1-205-879-2447.

We’d be happy to help you in any way we can.

You can also fill out a contact form and we will get in touch with you quickly. 

Thanks for reading, and have a great day!

-John G. Watts


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