Complaints against debt collectors have surged in recent years, which has somewhat masked another issue in the consumer credit realm: debt buyers. Debt buyers purchase charged-off debts from original creditors at a fraction of the price and then attempt to collect the full amount of the debt.
According to a recent article involving a debt buyer case in California, a sales agreement signed by Bank of America stated that Bank of America made no guarantees as to the accuracy of the credit records as part of a sale to a debt buyer. In other words, “buyer beware.”
Sold as is
According to the sales agreement submitted in California court, when Bank of America sold the charged off accounts, it made essentially no guarantees about the accuracy or completeness of the records.
Even worse, the agreement allegedly contained language stating that some of the debts may have been discharged in bankruptcy and some debts that may have already been paid back by the consumer.
In other words, they may have sold debts that were already satisfied or discharged in bankruptcy. All the more reason to do some due diligence when contacted by a debt buyer.
What you need to watch for
If you are contacted by a debt buyer, you can request validation of the debt. If you are sued by a debt buyer in Minnesota, you need to serve a written response within 20 days to protect your legal rights.
Frequently, consumers sued by debt buyers ignore the lawsuits, which results in a default judgment. If you have been sued by a debt collector or a debt buyer, you should immediately contact an attorney.
Consumers frequently ignore debt buyer lawsuits for any number of reasons: they don’t recognize the company, they think they paid it off, or they think the lawsuit is fake.
In Minnesota, however, a lawsuit can be initiated without filing it with the court. In other words, a summons and complaint without a court number is very likely a legitimate lawsuit. Failure to respond within 20 days means you the debt buyer can get a default judgment—which means you lose before your case even starts.
You can fight debt buyer lawsuits
Debt buyers frequently have problems producing the necessary evidence to substantiate their claims. In some cases, the only evidence they produce is attached to what appears to be a robo-signed affidavit. That evidence may ultimately be deemed not admissible.
I help consumers fight these cases and depending on the facts of your case, you may be able to get the debt buyer lawsuit dismissed, or settled for significantly less than the amount requested.
If you are in Minnesota, contact me today for a free case evaluation.