Fighting Collections Companies

I was in state District Court recently for trial with clients sued by a collections company. The couple co-signed on a new credit card for one of their children over a decade ago, and the collections company claimed my clients owed a debt on that account that had been amassing interest over an extended period. This was news to them, and they couldn’t understand why they had been sued. They had never, personally, used the account.*

It all happened quickly. They received an out-of-the-blue call from the collections agency, where no proof of the debt was given. A few weeks later, the collections company filed a lawsuit. A few weeks later, they got notice of the trial date.

Due to the age of the account, which had been paid in full and closed at least six years earlier, the couple and their child had no record of it. They all tried communicating with the collections company and with the company’s lawyer, but were either refused the information they requested or ignored altogether. The week before the trial setting, this couple came to me very distraught.

As is often the case, the creditor provided no records to the couple or to me, despite many requests, proving this debt actually existed. Similarly, nothing we could find proved the collections company had a right to sue for an alleged debt incurred at a retail outlet. On the day of trial, we appeared in court and learned the collections company and their attorney didn’t have these records. The attorney’s trial file contained one document: one page of a statement showing the account had been closed many years earlier.

The attorney agreed to dismiss the case before the first word to the judge was even uttered. My clients were simultaneously relieved and frustrated. They kept asking, why had they been put through such stress and anxiety for, what turned out to be, no reason at all?!

The answer is simple: the collections company expects you to roll over. To not show up to trial. To not not fight back. It happens often enough that it’s a safe bet for them to make.

Under similar circumstances, to avoid the stress and anxiety that my clients suffered through for so many months, follow these simple instructions:

• Gather information. When a collections company calls you, get the name of the caller, the name of the company, their mailing address, the name of the creditor they represent, the account number, and the amount of the alleged debt.
• Demand proof in writing. Request a copy of the contract, a copy of the statement showing you owe the amount claimed, a copy of the correspondence putting you on notice of the debt, and put these requests in a letter to the collections company. Keep a copy of the letter for yourself.
• Hire a lawyer. Unless you have legal training, you need representation at trial. Furthermore, some collections agencies will dismiss collections suits once a lawyer makes an appearance in the case.
• Do not ignore a summons. Regardless of whether you hire a lawyer or get the information listed above, attend the hearings set and defend yourself. If more people stood up to these types of suits, less of them would be filed.

* If you guarantee a debt by co-signing a loan or credit document, you are liable for that debt just as if you had personally incurred it.