Collection Agency threatening to sue?

Question

Was unemployed a few years back. Owe $6655 on an old Visa fromo BofA. Sold over two years ago. Bronson and Migliaccio from New Jersey has told me that they are going to serve me papers, and that they process has already started, filing fee and all on the 10th, so I should be getting papers in the next couple of weeks.

They have not tried to negotiate or anything and they will only take the full amount for a 3 year old bill. It is my belief that cc companies with two ways by a) selling the acct. and b) taking it as a tax loss. I lost with unemployment and 7 years bad credit.

I am a FT student with a FT job and have been responsible since my job loss. All this jargon is confusing me though. Can they garnish my wages without defending myself in court first? Has anyone ever been sued by a collection agency? What is it like? Do they let you defend yourself? What can I go in with to arm myself with? Any advice?

Answer 1

There is a lot of good and bad answers here.....

I can't really give you much advice with some more details. My main concern is if this will be a small claims or district court case. In small claims they have a limit on how much you can sue for, and many states are under $5000. That means you have to go to a higher court, and that could involve some complicated legal maneuvering. Your $6600 debt could be a problem on this point.

But lets not panic yet.

The first thing you need to do TODAY is read the Fair Debt Collections Act. Notice that by law they have to send you a letter notifying you of their intent to collect, and you are given 30 days to respond? You can still send them a "demand to validate" letter. In that event, they must supply you with proper validation of this debt, such as contracts, bills, receipts, and everything they used to calculate what they claim you owe. If they have not filed a suit yet, this will slow them down a few weeks.

Contact the local court and find out if there has been a lawsuit filed. Get a copy of it immediately. This may involve a trip to the court and a few dollars processing the copies.

Keep in mind that threating to sue you is a favorite tactic of collection agents. I've seen some go as far as mail a filled out court summons and court forms (not yet filed with the court)...and a letter saying if they don't get the money by a certain date they will file it. Again, this is a violation of the FDCA.

Study your state court rules. This is where I can't help you because every state has different rules. Once you know them, you can better plan a defense and strategy.

For example, in many states the judge can order installment payments instead of garnishing wages or taking bank accounts. You will need to show the judge your income and expenses, so start putting that information together. It would also help your case if you could show the judge you attempted to negotiate a payment plan with the collection agent, and they refused. I was at one trial where the debtor tried to make some reasonable payments for a $2000 debt, and creditor demanded everything at once. At court the creditor was a complete jerk and very unreasonable.....the judge granted him his judgment but ordered the debtor to pay only $5 a month on the debt.

You say you are a student, so you don't want a judgment on your credit. Just do what you can to settle this out of court. If you simply have no money, then you have no choice. Good luck.

Answer 2

I have been sued by a collection agency that was also a law firm. I never appeared in court(though I don't remember a summons), but they ruled for the collection agency anyway. It was for a chase visa card for about 1100. After they got a judgment on me, they started building up charges against the account. They plopped on 25% interest, late charges, processing fees, court costs, etc. I did not know about the judgment until about 3 years after the judgment was filed. The reason I found out was that they garnished my wages, at 20% of my wage, until the bill was paid. Well, at that time, the total amount was 27XX dollars. Even after all that amount was paid off(it took 4-5 months), I still owed 140 some odd dollars. They would not take off the garnish, they would not reason with me, and they never really tracked down my address when I moved in 2003. Basically, they wanted everything that I owed with no deals. And, because they are a law firm, filing court papers and appearing before a judge is basically free. They have no lawyers to hire because they ARE lawyers! If you could, try contacting the parent credit card company to start accepting payments. If that does not fly, you probably need to get a lawyer, so that you can drag out the proceedings as long as possible. If the law firm sees that the trouble is not worth it, they will probably be more willing to settle... The problem is, hiring your own lawyer is expensive...

Answer 3

I agree with a few of the other posters, and Studly gave some great advice. I just wanted to add a few more points.

The very first thing you should do is to check with your county court clerk to see if a suit was actually filed or not !!!

Since it has been 3 years, check your state statutes to see if you are still within the collecting SOL or not.
Click on my profile and follow the link that I listed to check it.
Depending on the state, that site will list the exemption statutes as far as whether garnishment is allowed or not, etc.
It will also list whether a collection agency must be licensed and/or bonded in your state or not. If your state requires it, check to see if that agency is.

The start of the collecting SOL would depend on your state statutes. It would either start from the first time you became 30 days late and never brought the account current leading to the charge off. Or it would start from the last time you made a payment or charge on the account before charge off.

Once they actually file a suit, it effectively halts the running of the SOL. So if they filed this month and your SOL isn't due to run until July (for example), then you would not be able to use SOL as a defense.

If you are past SOL or near to being past, within a few weeks or month - use an affirmative defense of SOL. Make them "prove" that you are not out of SOL.

If you are out of SOL, file a counter claim against them for filing on a time barred debt.

Order your credit reports and look over them with a fine toothed comb. IF they are reporting "any" violations, include those in your counter claims.

Look over any and all letters they sent to you for any violations, if there are any, include them in your counter claims.

If you have a good SOL defense along with legit counter claims, you may be able to find a lawyer that will take your case on a contingency basis.

Many lawyers will give a free first consult. If you decide to hire a lawyer be sure to find one that is well versed in consumer credit laws (FCRA, FDCPA, etc)

If you do hire a lawyer and you win, be sure that the lawyer request from the judge that his/her fees and all of your court costs are paid by the collection agency - if you win, even if you are allowed your counter claims, the collection agency should pay all of your court costs.

You might click on the last link I have listed in my profile. Do some reading and ask questions on that site.

Answer 4

Your wages can only be garnished with a court order. If there is a hearing for this, make sure you show up and defend yourself.

Keep in mind that:

"I'm a FT student with a FT job and have been responsible since my job loss"

AND

"They have no tried to negotiate."

AND

"I lost with unemployment and 7 years bad credit."

are not LEGAL DEFENSES!!!

Your only defense is that you didn't make the charges 3 years ago and your credit card was stolen. If that isn't the case, then you have no defense.

Answer 5

Once you receive the summons to appear in court you can call the Atty.'s office listed on the summons and make arrangements to pay without garnishment of your wages. I live in Tenn. and have done this before. However, states may differ in how they handle this type of collection practices so if I were you, I would consult an Atty. in my home state before I waste a lot of time listening to people that may be giving you incorrect information (according to their home state laws.) The only sure way to find out is to consult an an Atty. in your home state once you have been summoned as to what rights you may have.

I do know that you have the right to defend yourself in any court, but first arm yourself with an Atty. or at least the knowledge of your own state's laws regarding collection practices.

Answer 6

Under the Fair Debt Collection Practices Act, a debt collector can't threaten action (i.e. file suit) unless they actually intend too. Under the FDCPA, you have a right to ask the debt collector for a verification of the debt. Once you do that (I would do that in writting, via either fax or certified mail) the debt collector can't take any action until they provide verification. It might be best to find an attorney who handles consumer litigation. Contact your local county bar association for a referral.

Answer 7

They can actually sue you. then it will be a judgment on your credit report. Now, the thing is, the judge can have them take the money directly out of your check or bank account, which ever they choose. You need to pay them any money at all even if its $5, because having your money garnished is the worst ever. hope i could help.

Answer 8

You need an attorney. Yes they can garnish your wages and there really isn't a darn thing you can do about it. The contract you signed with the bank gives them that right without any representation on your part... called arbitration... and they always win.

Answer 9

They can and will go after you in court. I had one come after me for $1,000.00. So do not believe people when they say it won't happen.

They will have to take you to court first and get a judgment. After that they can garnish your wages, attach bank accounts and file liens on any property you may own like vehicles, land or homes.

Answer 10

They'll threaten all they want but rarely do they ever go for it.
It cost them too much money and takes up to much time for them to want to bother you , scare tactics!!!
Don't be fooled call someone who knows more but will be on your side to figure out your rights and what they can and can't do.
So many young people are suckers to this!
They want their money and their gonna try and make you wet your pants soooo STAY DRY!