If you live in Pennsylvania and have been sued by a third-party debt collector for alleged debt, you may have several options at your disposal.
Third-party debt collectors purchase hundreds, if not thousands, of consumer credit accounts that are in default at one time. These accounts are purchased from all types of institutions; credit card companies, automobile dealers, and banks are just a few of the types of creditors that sell debtors’ accounts for pennies on the dollar. The third-party collectors then utilize the services of law firms that specialize in obtaining monetary judgments against debtors.
These cases are numerous – and the third-party collectors and their hired law firms typically desire a quick and painless return on any investments, seeking what are referred to as default judgments. A default judgment against a debtor occurs when a complaint is filed, and the debtor simply fails or refuses to offer any type of response.
Depending on the amount of alleged debt, a third-party collector may file suit in either a magisterial district court or a county court of common pleas. While the rules and procedure are drastically different between the two types of courts, the laws protecting debtors are the same. Specifically, courts in Pennsylvania have maintained that plaintiff creditors must attach certain documentation to their complaints in order to establish that they have “standing” to bring the suit against the alleged debtor. Standing is a legal requirement, and means that the creditor must show the court that they have a connection to the debtor, and are thus allowed to file suit. Essentially, a creditor must have “skin in the game.”
Often, because third-party collectors buy debtor accounts in bulk, they lack appropriate documentation or an understanding of the business practices of the original creditor from whom they purchased the accounts. Therefore, with the proper legal argument, a court may find that the plaintiff third-party collector lacks standing to bring suit, and dismiss the case.
There are numerous other legal arguments that may applicable when defending a suit brought by a third-party debt collector. Our firm has been very successful in defending these suits – please contact us for a free consultation if you have been sued by a debt collector.
By: Christopher J. Gleeson, Esquire