How To Beat Junk Debt Buyers In Court. Do you have a lot of credit card debt? Do you need a way to maintain your credit card payment? Are you recently laid off from work and have junk debt buyers on your neck? Do junk debt buyers sue you?
If your answer Is “YES” to any of these questions, read on to learn how to beat junk debt buyers in court.
What You Need To Know About Junk Debt Buyers
Junk debt buyers are companies that buy past-due debt from your original creditors. These creditors could either be a bank or your credit card companies. Here are some things you need to know about junk debt buyers:
1. Collection Practices
There are many practices junk debt buyers can use to collect their payments. Most of these practices are aggressive—they use false statements, threaten legal action against you and disturb you with repeated phone calls.
2. Credit Reporting
If a junk debt buyer reports your debt to the credit bureaus, this will hurt your credit score.
3. Fair Debt Collection Practices Act (FDCPA)
FDCPA protects you from the deceptive manner of junk debt buyers: they prohibit debt collectors from using an abusive or unfair collection to collect their debts. This is because junk debt buyers are subject to the FDCPA.
4. Debt Disputes
If junk debt buyers are suing you, you have the right to dispute the validity of the debt and request validation from them. If the debt is found invalid, debt collectors must stop their collection.
5. Debt Validation
Before debt buyers can collect their debt, they must validate it and provide proof of ownership.
6. Statute of Limitations
Your state will determine the statute of limitation for your debt collectors and the type of debts you own. If your state statute of limitations has expired, it is illegal for junk debt collectors to collect their debts.
How Does Your Debt Get To Junk Debt Buyers?
You might be concerned about how your debts get to junk debt buyers when they should be with your creditor. When you open an account, there are terms and conditions you have to meet up with. However, unfavorable financial times might come:
- The loss of a job.
- The high cost of living.
- The inability to maintain your credit card payment.
If you miss one or more monthly repayments, your creditor will have no choice but to remind you of your late payment. Your creditor may hire a third-party debt collector to retrieve your payment if this continues.
If the third-party debt collector cannot collect the money on their behalf, and you haven’t paid for 180 days, they will charge your account.
Charge-off means that your creditor has written off your bad debts. You will still need to pay your debt again. It means that they’ve decided to take another action which could either be:
- Collect off of bad debt insurance
- Take a tax write off
- Sell your debts to a debt collection agency
How Do Junk Debt Buyers Make Money
Junk debt buyers make money by buying several debt accounts. They purchase each account on a 4 cents per dollar of the original debt; This means that if you have a debt of $2000 with a credit card company, and they sell it to a debt collection agency, the agency will likely pay $80 to acquire the accounts. In turn, they will make a huge profit from you if you later pay off the debt in full.
How To Beat Junk Debt Buyers In Court
There are many ways to beat junk buyers in court, including the arbitration clause.
The arbitration clause is mainly unknown to people. You can use the arbitration clause found on the credit card agreement with the original creditor as a possible defense. All you have to do is force the junk buyer suing you to withdraw their case from the court and use private arbitrators instead.
Regarding the arbitration clause, most collection agencies tend to withdraw because the money they will spend is usually more than the debts they are suing you for.
Benefits Of Arbitration Clause
Regarding the arbitration clause, your junk debt buyer will be unable to turn your debt into a “super debt,” canceling any default judgment against you. Some of the benefits of an arbitration clause are:
- Lawyers and attorneys of junk debt buyers are only sometimes familiar with the arbitration clause.
- You get to defend and represent yourself when you use an arbitration clause.
- When you force your junk debt buyers to withdraw their case from the court and use private arbitrators, their cost of collection increases.
- Even if you lose, the public record section of your credit report won’t display anything about arbitration.
To use the arbitration clause, you must consider your pros and cons. It would be best to examine your options but remember that you can’t do it alone. You will need a legal practitioner’s help to send a legal response to the debt buyer before taking action.
Other Ways How You Can Beat Junk Debt Buyers In Court Are By:
Know the statute of your state limitations
In most states, their statute of limitations varies from 3 – 10 years. All you have to do is know the regulation of your state limitations to check if it has expired. If it has expired, the junk debt buyers cannot sue you.
2. Respond to the complaints
If the courts summon you, the best thing for you to do is to respond to the court before taking any other action. Not responding can affect you negatively.
3. Verify your debt
Just because a debt collection agency sues you does not mean the debt is yours. Most junk debt buyers often buy debt portfolios without proper documentation, so you must confirm if the debt is yours.
4. Hire a lawyer
Not all citizens know their rights. Hiring a lawyer will give you more advantages when defending your rights. It is crucial to respond to all complaints sent by the court. Also, remember to follow all the laws and procedures of your court. Following their rules will increase your chances of winning.
When a debt collection agency sues you, fighting them in court can be pretty stressful, especially if you don’t know how to do it. To come out triumphantly, you need to know how to beat junk debt buyers in court, as provided in this article.