What should you look for once you’ve received a dismissal order in your collection lawsuit?

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What should you look for once you’ve received a dismissal order in your collection lawsuit?

What should you look for once you’ve received a dismissal order in your collection lawsuit_

Recently, during one of our live Q&A sessions on our Youtube channel,  a viewer from Billings, MT told us about his success in dealing with a collection lawsuit. He disputed the debt, as we discuss in many of our posts, and received papers dismissing the case. 

It is great to respond to the lawsuit. Many people fail to do this. 

He did what he needed to do by showing up to a trial or simply filing an answer. 

The court requested proof, and the collector couldn’t provide it.

Now that the case has been dismissed, what is the next step?

You’ll want to take a look at the papers dismissing the case.

Find the actual order from the court.

What do the court documents say about the motion to dismiss? 

On the order from the court, does it say that the case has been dismissed with prejudice or without prejudice?

In Alabama federal court, and it is likely the same in Montana, being dismissed without prejudice is like they never sued you.

They can still sue you again. 

Be sure to check your state to see if this is the same.  

Ideally, we want the case dismissed with prejudice

Normally prejudice is a bad thing in our day to day life. 

In the context of a collection lawsuit, it is a good thing. 

Dismissing a case with prejudice means it is completely over, final, it’s done. 

Think about a spy movie. 

You’re a super spy and your orders are to terminate the target with extreme prejudice. 

This just means to kill, to completely eliminate

When you get a dismissal with prejudice, the lawsuit is over. They cannot come after you for this a second time. 

This is how federal courts operate in Alabama – you will want to check the specific laws in your state. 

If the case has been dismissed without prejudice, it is not completely over. 

It may be over for this particular lawsuit, but the company can sue you again. 

Once you have determined how the case was dismissed, check your credit reports

Right now through April 2021, you can pull your credit reports for free every week.

I recommend you take advantage of this, especially when you are dealing with a debt collector.

When you were sued by a debt collector, you filed an answer disputing that debt. 

This may have been a dispute about the amount of the debt, whether the company owns the debt or some other issue. 

Whatever the issue is, you have disputed the debt and the collector has received that dispute. 

If that collector updated your credit report after receiving your answer, they must show the debt as disputed

If they do not show it as disputed, then I would look at suing them under the Fair Debt Collection Practices Act (FDCPA)

Specifically, they are violating FDCPA 1692 e(8), which says that a collector cannot do false credit reporting.

This includes failing to mark your account is disputed when they know it is disputed. 

However, there is one small caveat to this rule.

The collector must update your reports for most courts to say that this law applies. 

If the collector decides to never update your report again, then most courts would say they are not in violation of the law.

But if they receive your answer and they update your report, whether it is 2 weeks later or 2 months later, and they don’t show your account as disputed, look into suing them for this.

We hope this is helpful to you!

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If we can answer any questions for you, call us at 205-879-2447 or fill out our contact form.

Thanks and have a great day!

 

John Watts

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