"Do Nothing" Strategy to Winning Your Debt Collection Lawsuit

TL;DR

Find out about a unique strategy, where doing nothing might be appropriate when you are sued by a debt collector and are considered judgment-proof.

Transcript

• Hey everybody, John Skiba here. Did you know that 95% of people who are sued by debt collectors, don't do anything and they end up with a default judgment. Well in this video, I'm going to talk about a unique strategy, of Doing Nothing and when that may be appropriate, if you've been sued by a debt collector. But first, if this is your first time... Read More

Key Insights

• 👯 95% of people who are sued by debt collectors do not respond to the lawsuit, resulting in a default judgment.
• ✊ Obtaining a judgment gives debt collectors more power to collect the debt, such as garnishing wages or seizing property.
• 📼 Doing nothing as a strategy may be appropriate if you are judgment-proof and have exempt income or minimal assets.
• ❓ Understanding the exemptions in your state is crucial to knowing what property is protected from collection attempts.
• 🤨 Just because you are judgment-proof does not mean debt collectors won't try to collect, but you can raise exemptions as a defense.
• 🪘 Civil judgments can last for a long time and may be renewed, so considering the long-term effects is necessary.
• ❓ Consulting with an attorney is advisable to confirm exemptions and ensure full protection.

Questions & Answers

Q: Why do debt collectors want to obtain a judgment against you?

Debt collectors seek a judgment to have more legal power in collecting the debt, such as garnishing wages or seizing property.

Q: When may doing nothing be an appropriate strategy?

Doing nothing may be appropriate if you are judgment-proof, meaning your income and assets are exempt from collection attempts.

Q: How can social security income be protected from debt collectors?

Social security income is usually exempt under Federal and State laws, so debt collectors cannot garnish or seize those funds.

Q: What are exemptions and why are they important to understand?

Exemptions are laws that protect certain property from being seized by creditors. Understanding exemptions helps determine what assets may be safe from collection attempts.

Summary & Key Takeaways

• 95% of people who are sued by debt collectors do not respond to the lawsuit, resulting in a default judgment and full payment owed.

• Debt collectors aim to obtain a judgment as it gives them more power to collect the debt, such as garnishing wages or taking property.

• The strategy of doing nothing may be appropriate if you are judgment-proof, meaning that your income and assets are exempt from collection attempts.