A large debt in collections can leave you wondering if – or when – you need to call a lawyer. You may feel like you need protection or simply need more information about handling your financial situation.
To answer this question, Debt.com spoke with Rachel Bentley, an attorney at Legal Aid Society of Palm Beach County, and Colette Kienle, an attorney at Legal Aid Service of Broward County. Both represent consumers in debt.
They gave us insight into the debt collection process and what happens before and after a borrower goes to court. Many consumers worry that they can’t afford an attorney. Don’t let that get in the way of connecting with one. Many services – such as Legal Aid of Broward County or Legal Aid of Palm Beach County, where Kienle and Bentley work, respectively – offer free and low-cost assistance.
“There are limited resources for legal aid, so I unfortunately can’t represent everyone, but even just getting information and knowing your rights is key,” says Bentley. “We do the best that we can to help as many people as possible.”
To find out what your next step should be, click the sentence below that most represents your current situation:
I have debt I can’t afford to repay.
You’ve received notification by mail or over the phone that you owe a large sum of money to a creditor. But the amount feels colossal to you – so what now?
Waiting too long to address a debt and seek help is a big mistake. If you ignore or refuse debt collectors for long enough, they could take the next step and serve you a lawsuit. The debt itself was stressful enough – a lawsuit can make things even worse.
“Financial hardship can impact an individual’s health and relationships. The worry over not being able to meet financial obligations can lead to mental and physical illness,” says Kienle. “Most consumers seek help with debt collection because they are overwhelmed by their own financial situation and the court process itself,” Kienle says.
Preventing a debt collection lawsuit
If you haven’t received a court summons yet, try your best to keep it that way.
Follow all these procedures when dealing with collections to avoid being the target of a lawsuit. You could also consider other forms of debt relief.
Get proof
It’s possible you aren’t even on the hook for this debt. If the statute of limitations has expired, you don’t have to pay.
“Some of my clients call regarding debt collection letters,” says Bentley, “and we encourage them to send a debt validation letter even if they haven’t been sued yet.”
But be careful! If you assume liability to the collector, the statute of limitations may reset in some states, and you’re back on the hook. Ask the collector for written proof of your debt before you talk with them further.
If the collector can’t provide proof, they’re violating the Fair Debt Collection Practices Act (FDCPA) and you may not owe the debt at all.
Don’t ignore collections accounts
If you can’t pay the account, ignoring it won’t make it go away. Find a solution as soon as possible.
This could mean negotiating to settle the debt, working out a payment plan, or proactively contacting an attorney. The longer you wait, the more likely you could be sued for the debt.
Negotiate
Your debt amount isn’t set in stone. You could be able to negotiate a settlement on your own.
This means you can make an agreement with the collector to pay less than what you owe.
I have questions about debt collection.
The most important part of any debt journey is getting educated about your options. Finding out your debt has been sent to collections may make you desperate to make a decision quickly but take your time to learn about what’s on the table.
Start by doing some online research. If you have more specific questions about your personal situation, reach out to an attorney who specializes in debt collection.
“You should consult an attorney – or an organization with resources – as soon as you have a question about debt collection,” says Bentley.
“Information is golden, and there are a lot of great resources out there,” she adds. “Even if the attorney can’t represent you, they can provide you with information.”
I received a court summons.
Getting served with a lawsuit is shocking, but stay calm – there are simple steps you can take to start navigating this process.
Contact an attorney
“Upon receiving a court summons from a debt collector, the consumer should immediately seek consultation from a consumer law attorney, licensed in the state where the case was filed,” says Kienle. “The lawyer can then review the lawsuit and, from there, advise on a course of action.”
Seek out your local legal aid society if you’re worried about affording a lawyer. Most legal aid societies are organized by county, so search your county’s name followed by “legal aid society.” If your county doesn’t have one, a neighboring county or your state could have similar resources.
Read and understand
This may seem obvious, but too many people skip this step: read the details of the summons carefully. Failing to follow instructions can lead to an automatic win for the collector, meaning you will have to pay up.
The document may be in “legalese,” but the attorney you work with will help you understand it and what it means for your situation. The summons should include:
- Notification of the lawsuit,
- Details of the debt, and
- The date you need to file a response with the court.
Examine the details of the debt to see if you really owe it. It’s possible you aren’t required to pay, either because the debt has passed the statute of limitations or it belongs to someone else. Additionally, make note of all listed deadlines. It’s all too common for consumers to miss important dates, handing the collectors an automatic win.
Show up to everything
“In Florida, if service is proper, consumers must respond to the lawsuit (within 20 days from the date of service) or attend the initial hearing,” says Kienle. “Failure to do so will lead to a default in the case and faster escalation of the lawsuit through the court process toward a judgment against the consumer.”
The creditor winning by default judgment is not only common in Florida, it happens all over the United States. It’s normal to want to ignore the issue. But if you don’t show up, your situation can only get worse.
Work with the attorney
Yes, you could take your chances responding to the summons on your own and representing yourself. However, working with an attorney increases the likelihood you’ll win your case. Plus, with legal aid societies offering free and low-cost services, there’s no excuse not to reach out.
Before contacting an attorney, though, it’s best to be prepared. Here’s what to do to make it easier to represent you in court:
Organize your files
“A defense which challenges the collector’s right to enforce the contract is best supported by credit statements, client payment records, notification of debt assignment and credit card contracts,” Kienle says.
Gather all these files and anything else that may pertain to your debt.
Keep all correspondence
“Don’t throw anything away – not even the envelopes things come in,” says Bentley.
In a debt collection case, you can never be too sure which documents will be important and which won’t. That’s why it’s important to keep everything – you’ll always have what your attorney asks for.
Have a narrative
“I really want my clients to tell their story,” says Bentley. “I want basically anything you have relating to the debt.”
Your attorney will help you come up with a cohesive “story” to tell the court but try writing your own narrative first. How did you incur the debt? What happened that made it difficult for you to pay? Why didn’t you address the debt with collectors for so long?
Create a consistent timeline and stick with it. The more you write down, the better – memory isn’t always reliable.
A debt collector is harassing me.
If a debt collector is making you uncomfortable, you may be able to take action. First, make sure that their behavior counts as harassment according to the FDCPA. True harassment may mean you can sue the debt collector or be part of a class action lawsuit.
What you should know about the FDCPA
The federal Fair Debt Collection Practices Act is there to protect consumers like you. An attorney can point out FDCPA abuses from your creditors, but it’s good to know the rules yourself.
“Consumers may have the mistaken notion that, because they owe the debt, they have no protection under consumer laws,” says Kienle. “They don’t realize that the protections of consumer law apply regardless of the validity of the underlying debt.”
Here are a few warning signs that a collector may be violating the FDCPA:
- Calling you before 8 a.m. or after 9 p.m.
- Using rude language or threats.
- Telling other people (friends, family, your boss) about your debt.
- Reporting false information about your debt.
There are many more possible violations of the FDCPA. Additionally, state debt collection laws can be even stricter. Check your state’s regulations or contact your local legal aid society if you have questions.
The debt I’m being asked to repay isn’t mine.
“Clients may claim that they are victims of identity theft or mistaken identity,” Kienle says. “For these cases, I request that the client provide me any reports to the police, creditor, or credit agencies which they may have filed.”
An attorney can help you prove the debt isn’t yours, getting you off the hook for paying anything.
