Sued by a Debt Collector? Don't Give Up! | Summary and Q&A

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January 31, 2017
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Consumer Warrior
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Sued by a Debt Collector? Don't Give Up!

TL;DR

A court ruling in an Arizona junk debt buyer case has resulted in a victory for the consumer, with a potential refund for attorney's fees.

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Key Insights

  • 💳 Junk debt buyers purchase old charged-off debts from credit card companies for a fraction of their value.
  • 🌥️ Midland Funding, one of the largest debt buyers, filed over 500,000 lawsuits in one year alone.
  • ❤️‍🩹 Many individuals sued by debt buyers are unaware of the lawsuits and end up with default judgments.
  • 🥺 Responding to lawsuits and seeking legal assistance can lead to favorable outcomes or settlements.
  • ❓ The Consumer Financial Protection Bureau has imposed sanctions on numerous debt buyers for their practices.
  • 👽 Debt buyers can take actions such as wage garnishment, bank account levies, and property liens once they have a judgment.
  • ✌️ Arizona consumers have strong defenses against debt buyer lawsuits, as shown by the victory in the mentioned case.

Transcript

everybody dijon Skiba from the consumer Warrior Project and I'm also an attorney Arizona consumer law group were based in Mesa Arizona you know today we got a ruling from the court in one of the junk debt buyer cases that I was handling junk debt buyers are these companies that buy old charged off debts from credit card companies and then they file... Read More

Questions & Answers

Q: What are junk debt buyer cases, and why are they important?

Junk debt buyers purchase old charged-off debts from credit card companies and file lawsuits to collect on them. These cases are significant as they impact thousands of people's finances.

Q: What happens when a debt is charged off?

When a credit card company determines they can no longer collect on a debt, they charge it off as a loss on their books. However, they can still attempt to collect on it or sell it to a junk debt buyer.

Q: How do junk debt buyers operate?

Most debt buyers purchase these debts for pennies on the dollar, sometimes less than a penny. They then file a large volume of lawsuits to collect on these debts, potentially resulting in default judgments for individuals who do not respond.

Q: What should individuals do if they receive a lawsuit from a debt buyer?

If served with a lawsuit from a debt buyer, it is crucial to respond within 20 days to avoid a default judgment. Seeking legal advice and understanding one's defenses can help in fighting these cases.

Summary & Key Takeaways

  • A court ruled in favor of a client in a case against junk debt buyer Midland Funding, who had claimed the client owed over $20,000.

  • This victory marks the second time the court has ruled in favor of the consumer, potentially resulting in the consumer receiving a refund for attorney's fees.

  • Junk debt buyers purchase charged-off debts from credit card companies and file lawsuits to collect on them.

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