Bankruptcy Tips: How to Handle a Debt Collection Lawsuit

TRI Writer • February 3, 2021

Has a process server served you legal papers regarding a debt collection lawsuit? Being served at home or work is not pleasant. If you are served debt collection lawsuit papers, you may not know how you should respond. 

The Best Case Scenario: Avoid the Debt Collection Lawsuit

The best-case scenario avoids the debt collection lawsuit entirely by preventing the debt from reaching the point where the creditor files a lawsuit. Creditors do not want to file a lawsuit until they attempt to collect the debt using all other collection options available. If you are contacted about a debt, stay calm. Confirm whether the information they have is accurate or not. If contacted by a collection agency, request written proof that they own (or have been assigned) the debt and written proof that you owe the debt. If they are unable to provide these items, they may be unable to collect the debt. 

3 Things To Do When Served with a Debt Collection Lawsuit

Do Not Ignore a Debt Collection Lawsuit

If you just got served with a debt collection lawsuit, you may have no idea what to do. The first thing you need to know is that ignoring the lawsuit is a bad idea. There are time limits to respond before a default judgment is entered against you, and the creditor will finish the case without you if you ignore the filing. 

If Served with a Debt Collection Lawsuit, Gather All Documentation on the Debt:

Gather all the documents you can that relate to the debt listed in the lawsuit. The account’s history is essential since you may have paid off the account. Their information could be inaccurate, or the account may have been inactive so long that it is too late for the collector to collect on the debt or get a judgment. 

Contact an Experienced Bankruptcy Attorney:

Contact an experienced bankruptcy attorney as soon as possible, and make sure to let them know that you have been served with a debt collection lawsuit. Be careful what you say, what you sign, or admit to any creditor or any creditor’s attorney. Even with a judgment entered against you, certain exemptions allow you to protect more of your income. For instance, a head of household has additional funds protected from wage garnishment, but if you inadvertently admit that you are not the head of household, you may forfeit this protection. It is best to consult an attorney as soon as possible and discuss options that could protect you from aggressive creditors. 

If you need to file bankruptcy due to a debt collection lawsuit , discuss your options with an experienced bankruptcy attorney. Don’t hesitate to call Kenneth C. Rannick P.C., Tennessee, and Georgia bankruptcy attorney. We help good people through bad times.

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