If you are sued by one of the major debt buyers like Portfolio Recovery Associates, Midland Funding, or CACH, LLC, the worst thing you can do is sit on your hands and ignore it. You see, if you’ve been served with a complaint and summons by a process server from one of these debt buyers like Portfolio Recovery, they are seeking a judgment against you for the amount of money they claim your owe. After a creditor obtains a judgment, it can start to garnish your wages and bank accounts. It also makes selling your house a more difficult proposition.
If you fail to even respond to the law suit, Portfolio Recovery will get a default judgment against you. This means they win by default because you failed to answer. Under Georgia law, you have 30 days to respond to a law suit, but it amazes me how many people schedule a consultation with me AFTER they have a default judgment against them. The typical case is that the person’s wages are being garnished, and if you have a garnishment against you, it means the creditor has already obtained a judgment against you.
Once Portfolio Recovery has obtained a default judgment against you, they no longer have to prove their case. At this point, your only options are to re-open the default in a timely manner or file bankruptcy.
But you should absolutely answer these types of law suits. Debt buyers know that in a vast majority of cases, the defendant simply will not answer the complaint and a default judgment is guaranteed. But what they don’t tell you is that when they buy these debts, they often have an incredibly difficult time proving their case. This is because they have to prove that you actually are the person that owes them money. When they buy these accounts, they are often missing vital paperwork to prove that the debt is really owed, and often it is just a spreadsheet of accounts, names and phone numbers with no supporting documentation. So if you’ve been sued, at least go see a competent attorney who will help you file a legally sufficient answer.