“I’ve Been Sued by My Credit Card Company!”
Debt buyers such as CACH, LLC, Midland Funding, Unifund, Atlantic Credit & Finance, First Resolution Investment, LVNV Funding, Palisades Acquisitions, Asset Acceptance, Razor Capital, and Erin Capital Management don’t have the easiest time when they are forced to actually try their lawsuits.
None of these companies are actual credit card issuers. All of them are companies that buy defaulted accounts – and the right to collect on the outstanding balances. Buying credit card debt can be very lucrative and profitable, but when one of these a debt buying predators files suit, their cases usually have a fatal defect in them: The debt-buying company can’t prove they own the right to collect on your credit card bill. What this means to you is, they often can’t prove the defendant owes THEM – not that the defendant doesn’t owe the bill, but that the defendant does not owe the debt-buying company itself. They have to prove that they have the right to collect on your debt.
Debt buying is done in massive quantities, and is mostly computerized. This means there is often no “bill of sale” for the individual account on which they are suing, and without a bill of sale, the debt buyer can’t prove in court that they own the right to collect.
When confronted in court by knowledgeable defense counsel (ahem, like me), as trial approaches, the debt buyers become increasingly nervous. Even if they should draw a sympathetic judge – one who won’t hold them to the proof the law requires – and they win, they may be unable to collect from a defendant who has no assets (is “judgment-proof”), or who is scraping the couch cushions for nickels.
In short, as trial approaches, debt buyers and their attorneys will look to get what they can, and if that number appears to be zero, to dismiss altogether. Be warned though: This is only true when pressed by (ahem again) knowledgeable defense counsel. So don’t try this at home, kids…..
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