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Getting Sued by a Collector – Making a Settlement

On Behalf of | Oct 15, 2012 | Consumer Protection

When a debt collector sues a consumer, the consumer has to answer that lawsuit by following the instructions on the Summons that is served. But here are some pitfalls and pointers:

Make sure the case is handled.  It is one thing to settle the debt, but there is still a lawsuit out there with your name on it.  What is going to happen to it now that you struck a deal?  The collector may still want to have a judgment entered in case a payment is missed on a payment agreement.  That would allow them to immediately garnish wages or take assets without having to go back to court. It is best to argue for a dismissal of the case.  A dismissal “with prejudice” means the case is dismissed forever, and there is no right to bring the matter back to court.  A dismissal “without prejudice” means that the case can be brought back for reasons such as non-payment.  If a payment agreement is being made, it is highly unlikely a collector will agree to dismiss a case with prejudice.  Dismissing a case without prejudice is a happy medium that allows the collector the right to go back to court if you don’t pay, but gives you peace of mind knowing that the case is currently dismissed and will stay that way as long as the debt is being paid.  Either way, you cannot ignore the lawsuit. Get any agreement in writing.  These collectors handle dozens of lawsuits a day.  It is not surprising if something slips through the cracks.  Whatever deal is worked out, get it in writing from them.  Most importantly, get how they will handle the court case in writing.  If the case will be dismissed, make sure that it says so on the document they give you.  Follow up on that case.   Despite what they promise you and give you in writing, follow up to make sure they did what they promised with the court case.  Get a copy of the dismissal order if the case is being dismissed.  If a conditional judgment is entered, get a copy of it.  Don’t rely on their comments to “trust” them – that “everything is all fine”.  All too often we have seen consumers think they worked out a deal for their case, but later found themselves having to face a wage garnishment. SmithMarco, P.C. helps consumers defend lawsuits and settle their debts in a way that is fair and economical.  Contact us for a free case review.