Forget about the phone calls and aggressive communication tactics – how would it feel to be subpoenaed by your creditor? Yes, it can happen. Your creditor can actually sue you to collect on debt owed.
With many Americans struggling to pay their bills, we have seen an increase in the number of debt collection lawsuits. The problem seems to have gotten so bad that the Federal Trade Commission (FTC) is seeking to reform the debt collection litigation practices. After all, the FTC says “Debt collectors generate more complaints to the FTC than any other industry group.”
Andrew Martin’s New York Times article Automated Debt-Collection Lawsuits Engulf Courts does a great job highlighting some of the major issues with debt collection lawsuits and the huge number of cases that are being filed against consumers today.
Here are a few tips if you’re being sued for debt collection:
- Verify the debt is actually yours. This one may sound easy, but I’ve heard of people paying it just because they were told that they owed it.
- Challenge any inaccurate information. This includes your account balance, interest rate and any additional fees.
- Appear in court. Appearing in court or having representation gives you a voice in the matter. According to the FTC, “courts frequently granting default judgments against consumers who do not appear or defend themselves.”
When it comes to debt collection, know your rights. Below is the FTC’s video that explains your consumer rights for dealing with debt collectors.
Do you have any thoughts on being sued for debt? How about any other tips to add?