A few years back four consumer advocacy groups did a study on debt buyers’ abusive collection lawsuits in New York City. The findings were pretty shocking. Here is a handful of what they found:
- 35% of debt buyer lawsuits were clearly merit-less
- Debt buyers prevailed in 94.3% of debt collection lawsuits, usually by obtaining default judgments
- At least 71% of people sued were either not served or served improperly
- 95% of debt buyer default judgments involved consumers residing in low – or moderate-income neighborhoods, and 56% involved those living in predominantly African-American or Latino neighborhoods
- Only 1% of people sued by debt buyers are represented by counsel
- Only 10% of people sued answered the summons and complaint
As an attorney, the really shocking statistic is that 71% of people sued were either not served or served improperly and that 90% didn’t even file an Answer. Every day I meet with people who are getting their wages garnished from a debt buyer and the garnishment is the first they have ever heard of the lawsuit.
That is not supposed to be how the system is run.
People must have an opportunity to defend themselves against the allegations of the debt buyers. On the contrary, most people aren’t even aware that the lawsuit exists! Many times they will attempt to serve you at an old address and then magically are able to find your current address when it comes time to garnish your wages or lien your home.
Fighting and winning your junk debt buyer lawsuit can be a reality, but you must file an Answer to the lawsuit. You have to participate in the process. If you ignore it or think that it will work itself out somehow you will likely end up with a default judgment, wages garnished, or worse.
You can get a copy of the study by clicking HERE.
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John Skiba, Esq.
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