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Creditor Lawsuits: What to Expect

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It’s no secret that receiving a letter from a lawyer threatening a potential lawsuit over an unpaid bill can be unnerving.

If one has an unpaid medical, furniture, or student loan bill, a debt collection lawsuit may be filed. Our expert Miami debt defense attorneys are providing insights on what to expect from a lawsuit launched by a creditor.

A Complaint is Filed

The debt collection lawsuit begins when the creditor or a lawyer on behalf of the creditor files a complaint with the court. Whomever signed the loan or account will be listed as a defendant. The complaint will also state the creditor’s reasons for the lawsuit and what the creditor wants in return. This usually amounts to the money owed, interest, and attorney fees.

The Complaint is Served

Once a complaint is filed, the creditor or lawyer must serve the defendant a copy of the complaint along with a summons. A summons notifies the defendant that they are being sued and usually includes when the defendant needs to file a response in court.

Most creditors hire a professional server or local sheriff to serve these documents because most courts require that the complaint and summons are served personally. Some courts do allow creditors to serve the summons and complaint by mail along with a form that acknowledges an acceptance of the documents. If a defendant does not sign and return the form and the creditor proves that the defendant refused to, the defendant will be liable for the process server costs.

Where Does the Creditor File the Lawsuit?

Usually, the creditor decides to sue the defendant in state civil court. If a defendant owes money to the federal government, the creditor will sue in federal court. Most states allow for creditors to sue in small claims court as long as the amount doesn’t exceed a specific limit. In Florida, the amount must not exceed $5,000.

Responding to a Lawsuit

Once the lawsuit is filed, the defendant has about 20-30 days to submit a written, formal response. The response is often called the “answer.” When a response is filed, the defendant is required to pay a filing fee. It is advised to consult with one of our attorneys when preparing the answer. A debt defense attorney can point out defenses the debtor may be unaware of, assist with writing the response, and represent the defendant in the lawsuit.

If the defendant fails to meet the filing deadline, the creditor will usually request a default judgment from the judge. With a default judgment, the creditor may be able to seize the defendant’s wages, place a lien on their property, and freeze the defendant’s assets.

Talk to an Expert

After a creditor has filed a lawsuit, it’s crucial to make a decision on your next steps. It is worthwhile to consult with one of our knowledgeable Miami debt defense attorneys in order to attain the best possible outcome. For a free consultation, contact the attorneys at Graham Legal, P.A.

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