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How to Challenge a Debt Collector & Win

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A reader, Anthony, wrote to me to share the success he had in dealing with the debt collection issues he faced earlier this year. He started off with the goal of settling an old unpaid credit card, and ended up winning in court and getting his costs covered. He wrote:

“Hi Michael, I contacted you several months ago as I was being sued by a debt collection law firm for a [credit card] account that I had in 2008. I tried to negotiate the charge, which they calculated at $900, but original balance was only $600. I ended up hiring an attorney after they failed to negotiate. To make a long story short, they dismissed the case because they had no witness at which time my attorney objected and asked the court to pass on court fees and attorney fees to the collection agency. The judge ruled in my favor on the spot for the court fees, and instructed my attorney to file a separate complaint for attorney fees. By objecting, he stated that the collection law firm couldn’t come after me again. Thanks for your help and motivation to fight their efforts to sue!”

The majority of debt collection lawsuits are ignored, never contested, or not challenged effectively (some reports suggest more than 90% of lawsuits end in default or summary judgment).

From what I have seen in my many years of helping people resolve their debts — debt collectors are more likely to not challenge smaller balance lawsuits like Anthony’s, even if they’d previously refused to negotiate a fair settlement. Meanwhile, it is cost-prohibitive for a consumer to challenge the debt collector’s claims with one’s own attorney, when the cost of hiring an experienced debt defense attorney may end up costing more than paying the debt in full. And there are no guarantees that you will win. Having the judge pass the court and attorney fees along to the debt collector, like in Anthony’s case, then, is ideal for the consumer.

Dealing With Collections in the Courts

It’s important to be prepared when dealing with debt collection lawsuits and judgments. This resource checklist can also help you when you’re dealing with late-stage debt collection, or if you believe a debt collector has violated your consumer rights:

  • If your goal is simply to negotiate an affordable lump sum settlement, there are resources you can consult to help you through that process.
  • If you are looking for an attorney to help you defend against a collection lawsuit, you need to know that the vast majority of attorneys are likely unable to effectively assist you with your defense. Most attorneys just do not practice in this area, and over the years I have found that talking to the wrong attorney about your issues can do more harm than good. But there are some attorneys who focus on collection defense.
  • Look for an experienced debt defense attorney with the National Association of Consumer Advocates (NACA). Distance is not always an issue with these cases. Some debt collection defense attorney offices cover multiple states.
  • Contact a low-income legal aid office nearest you. Some of these offices do offer debt collection defense to people who qualify for low- to no-cost legal assistance.

It’s also a good idea to also make sure your debt hasn’t surpassed the statute of limitation. This chart lists the statutes of limitation by state. You may also want to check your credit reports to ensure the debt is being reported accurately, and to correct any errors. You can get your free credit reports every year from AnnualCreditReport.com, and you can get a free credit report summary, updated every month, on Credit.com.

There are additional things you can do to resolve debts with collectors, including picking up the phone to talk to collection attorneys and their staff. Anthony may not have had success with his efforts, but he did try that first. And countless others are able to get a result they can live with by simply opening up the lines of communication.

Everyone is welcome to post in the comments below for feedback. Please consider sharing your successes, failures, and other outcomes. It is important for people to hear about how others make out with late-stage collections when they are trying to decide what to do in their own situation.

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  • Lucy Day

    Hello and thank you for this information. Where I am getting confused is some of my debts date back to 1995 and I wrote a dispute with the credit reporting agencies saying this and they told me it still stands because the debt has been purchased so it starts when new company takes it . This makes no sense as you and others said after 7 yrs. It should be removed. I dont know what to do to get them removed. Only thing that should be current are medical bills nothing else but I cant get them removed and I cant afford an attorney. I am on Disability now. What am I to do to stop the accounts from showing on my reports?

    • http://www.Credit.com/ Gerri Detweiler

      Collection account may only be reported for seven years plus 180 days from the date you fell behind with the original creditor. That’s true regardless of whether they are paid. You may want to talk with an attorney who represents consumers in credit damage cases. If you have a good case (and it certainly sounds like you might) they may take your case on a contingent fee basis so they are paid only if successful. (Visit the website of the National Association of Consumer Advocates if you need help finding one.) The other option is to file a complaint with the CFPB.

      • Lucy Day

        Thank you I will start looking for one. Have a Blessed day.

    • Michael Taylor

      You may need to get legal aid…. I see this kind of thing all the time… Most of them
      Are removed when challenged by an attorney on your behalf … Bill collectors buy debt in bulk… You are just a name on a spread sheet… Chances are good they have NO further information on your past overdue debt… No signed contracts, No payment histories … Nothing…. When you fight it.. They got Nothing … As far as the 1995 debt is concerned… That is untrue… The statute of limitations applies to your case… Most states it’s 10 years for signed contracts…challenge the debt with the 3 angencies again… It should say something like this…” This is not my debt… Remove from my credit profile… They can ONLY extend that time if you act on the debt… That means if you make a payment… That resets the clock.. Sometimes the best thing to do if to NOT pay… But challenge.

  • Judi Lauren

    Can I fight a collection if the original creditor is no longer listed on my report? I have three collections on my report from the same creditor and collection agency: one paid in full, the other $250 left, and another for $900 that I have not paid. But the original creditors are no longer listed on my report.

    • http://www.Credit.com/ Gerri Detweiler

      Collection accounts may be reported for seven years plus 180 days from the date you first fell behind with the original creditor. If they are older than that, you can dispute them.

  • Erika Casarez

    Can I fight a collection after I already started paying? Orginial amount was $3600, collection is $6200…I have already paid about $2800. Can I stop paying and re work out terms or what is the best way to go about it.

    • http://consumerrecoverynetwork.com/ask-a-question/ Michael Bovee

      Is the collection a judgment, or an account that had went to court?

      If this is a payment agreement on an existing judgment, stopping payments could lead to extra ordinary collection efforts such as liens, bank levies, and garnishment (as would apply in your state and to your situation).

      If the debt was never in the courts, and you had simply worked out an arrangement that is no longer affordable, stopping payments can indeed open up opportunities to negotiate a lump sum settlement for less.

      If your goal is to rework the monthly payment to something more affordable because of a recent financial set back, you can call and talk about your options with the collector.

      • Erika Casarez

        The collection is a standard collection but I didn’t have the funds to repay so I made arrangements. BUT then I started looking into it and I realized it was doubled the amount of the original collection. I understand that I have to pay fees but not thousands of dollars in fees. I’m paying a law firm they threaten to take me to court so I started to pay off. I was very young, in college when i got this credit card. Should I stop paying the law firm and just renegotiate with the collection agency?

        • http://consumerrecoverynetwork.com/ask-a-question/ Michael Bovee

          If your account was never involved in a court collection action, stopping paying now in order to try to negotiate a lower lump sum pay off on the remaining amount owed could make sense.

          Stopping paying could also lead to the original outcome you were trying to avoid (being sued).

          If it were me in your shoes I would want to have the targeted amount I want to settle with in hand and ready to fund the agreement you make.

          If this account was in the courts, or gets to the courts, contact a consumer law attorney who practices debt collection defense regularly.

          • Erika Casarez

            I have contacted the agency which is Calvary and they have said that I must submit a letter to them requesting valdiation on the amount owed. The orginial amount was $3692 back in 2009 and the amount jumped to $6200. I have already paid almost half of this and I just want to be done with this and removed off my credit. Is there a standard letter format I can send to them to request them to investigate this account. Should I stop payment. I don’t want them to send me to count and then have to pay a lawyer.

  • mrk222

    I learned from experience that when “Junk” collections appear on your credit report the best response is to contact the agency/firm who is reporting the claim and DEMAND proof of the debt. Since most of these old claims are bought in bulk they have no supporting documentation. Include in your letter to the agency a demand that they remove the credit reporting if they cannot substantiate the claim. It only took 30 days for those silly things to disappear.

  • mwilliams

    I have a judgement from 2006 from discover card i never went to court on this judgement. I call the attorney that was handling the case and ask if i could settle with them.the debt 7,238.00 the attorney me to settle would 7,000 i think i am going to court and get all the documents that was file on this judgement something dont seems to be adding up i want to pay it and be done. The judgement is in florida. I ask the attorney to send some documents showing what all we discuss about the payment plan

  • Elen

    Mr. Bovee, I have an old credit card that was charged off in 12/2013 (last payment 6/2013) & this month I received letters from US bank & Portfolio Recovery Associates informing me that PRA now owns this debt of 5,555.88.

    I know the debt is not time barred in my state. What are your thoughts about calling PRA and offering $2000 to settle, pay in full, done deal?
    Thank you!

    • http://consumerrecoverynetwork.com/ask-a-question/ Michael Bovee

      Good to talk with you on the phone earlier. Please let me know the progress you make with this account.

  • http://www.Credit.com/ Gerri Detweiler

    Vanessa – I am sorry but I don’t know the procedure for disputing an attorney’s bill after they have died. I suggest you reach out to the executor or, if you feel it is worth it, consider talking with your own attorney.

    • Vanessa McGinn

      I think it’s very possible with her lack of organization that she may not have records or complete records of what is owed- do you think it’s worth it to simply challenge the debt for starters
      of they cannot provide validation of the debt, does that mean they cannot collect it?
      Thank you for your help!

      • http://www.Credit.com/ Gerri Detweiler

        The FDCPA (the law that is discussed in this article) does not apply to business debts–only to personal ones. If this falls into the business category then it may not apply. In addition, that law only applies to third party collection agencies and the executor may not fall into that category. Furthermore, an FDCPA violation does not necessarily mean the debt is erased.

        I am not saying you don’t have valid grounds for disputing this bill, but I don’t know the best way to do that as this is an issue I have not dealt with before.

  • Sherry Martz

    I have a collection debt on my credit reports, in which the courts ruled in my favor with the lawsuit when [redacted] sued me for the amount owed. My question is, is there a way to remove this account from my credit report or am I stuck with it for the forsee able future till the limitation on debt collections runs out?

  • Jeanine Skowronski

    You may want to consult a consumer attorney about your best recourse.



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