What to Do If You're Sued by a Debt Collector

Opening your mailbox to find a lawsuit summons from a debt collector is stressful and frightening. Your first instinct might be to ignore it, hoping it goes away. This is the worst thing you can do. Ignoring a debt collection lawsuit almost always results in a default judgment against you, giving the creditor legal authority to garnish your wages and seize your bank accounts.

The good news? You have options, and taking action immediately can significantly improve your outcome. This guide walks you through exactly what to do, step by step, when you're sued by a debt collector.

Step 1: Don't Panic—But Do Act Quickly

First, take a deep breath. Being sued for debt is more common than you think. Millions of Americans face debt collection lawsuits every year, and many successfully defend themselves or negotiate favorable settlements.

However, time is critical. Most states give you between 20 and 30 days from the date you were "served" (officially notified of the lawsuit) to file a response with the court. This deadline is strict—courts rarely grant extensions, and missing it means you lose by default.

Step 2: Read the Lawsuit Documents Carefully

Your lawsuit packet typically includes several documents. The most important are:

• Summons: This tells you that you're being sued, who's suing you, which court the case is in, and your deadline to respond.
• Complaint: This document explains what the plaintiff (the party suing you) is claiming. It usually includes the amount they say you owe, the account information, and the legal basis for the lawsuit.
• Exhibits: These might include copies of account statements, credit agreements, or other documents the plaintiff is using as evidence.

Read everything carefully and note:

• The exact amount the plaintiff claims you owe
• The name of the original creditor (who you originally owed)
• The name of the plaintiff (who's suing you—often a debt buyer or collection agency)
• The court where the case is filed
• Your deadline to respond (usually called the "answer date" or "response deadline")
• The case number

Step 3: Verify the Debt and the Plaintiff's Standing

Just because someone is suing you doesn't mean they have the legal right to do so or that you actually owe what they claim. Before you respond, ask yourself these critical questions:

Do I recognize this debt?

Look at the account information in the complaint. Do you remember opening this credit card, taking out this loan, or receiving these medical services? If not, this could be:

• Identity theft or fraud
• A case of mistaken identity (wrong person with a similar name)
• A debt that's not actually yours

Is the amount correct?

Even if you recognize the debt, the amount claimed might be inflated with:

• Excessive interest charges
• Improper fees
• Charges added after you stopped using the account
• Errors in calculation

Is the statute of limitations expired?

Every state has a "statute of limitations" for debt collection—a time limit after which a creditor can no longer sue you for the debt. This period varies by state and debt type (typically 3-6 years for credit card debt). If the debt is older than your state's statute of limitations, you have a strong defense.

Does the plaintiff have the right to sue?

Many debt collection lawsuits are filed by debt buyers—companies that purchase old debts for pennies on the dollar. To sue you, they must prove they own the debt and have the legal right to collect it. This is called "standing to sue."

Common problems with standing include:

• Missing or incomplete chain of ownership documentation
• Inability to prove they purchased your specific debt
• Lack of proper assignment from the original creditor

Step 4: Gather Your Evidence

Start collecting any documents related to this debt:

• Old account statements or bills
• Payment records (bank statements, canceled checks, receipts)
• Previous correspondence with the creditor or collector
• Debt validation letters you may have sent
• Credit reports showing the account history
• Any settlement agreements or payment plans

Even if you don't have much documentation, gather what you can. Your attorney or case support team can help you obtain additional records through the discovery process.

Step 5: File an Answer (Your Official Response)

The most important step is filing an "Answer" with the court before your deadline. An Answer is your official response to the lawsuit. It tells the court:

• Which allegations in the complaint you admit
• Which allegations you deny
• Any affirmative defenses you're raising (legal reasons why you shouldn't be held liable)

Filing an Answer prevents a default judgment. Even if you don't have a strong defense, filing an Answer keeps your options open and forces the plaintiff to prove their case.

What goes in an Answer?

A proper Answer typically includes:

• Caption: Court name, case number, parties' names (formatted to match the complaint)
• Responses to allegations: Paragraph-by-paragraph responses admitting, denying, or stating you lack sufficient information to admit or deny each claim
• Affirmative defenses: Legal defenses like statute of limitations, lack of standing, improper service, payment, settlement, etc.
• Signature and verification: Your signature (and sometimes a notarized statement that your responses are truthful)

Step 6: Consider Your Options

Once you've filed an Answer, you have several paths forward:

1. Negotiate a Settlement

Many debt collection lawsuits settle before trial. Debt buyers often purchase debts for 10-30% of the face value, so they may accept a settlement for less than the full amount. Settlement benefits:

• Resolves the case quickly
• May save you money compared to the full judgment amount
• Avoids the stress and uncertainty of trial
• Can include payment plans

2. Fight the Lawsuit

If you have strong defenses (statute of limitations, lack of standing, wrong amount, not your debt), you may want to fight the lawsuit. This involves:

• Discovery (exchanging evidence with the other side)
• Potentially filing motions to dismiss or for summary judgment
• Attending hearings
• Possibly going to trial

3. Seek Dismissal

In some cases, you can get the lawsuit dismissed without a trial if:

• The plaintiff can't prove they own the debt
• The statute of limitations has expired
• You were improperly served
• The debt was discharged in bankruptcy
• The plaintiff can't produce required documentation

Step 7: Prepare for What Comes Next

After you file your Answer, the case moves into the discovery phase. This is when both sides exchange information and evidence. You might receive:

• Interrogatories: Written questions you must answer under oath
• Requests for Production: Requests for you to provide documents
• Requests for Admission: Statements you must admit or deny

You'll also have the opportunity to send discovery requests to the plaintiff, asking them to prove they own the debt and have the right to collect it.

Common Mistakes to Avoid

How MAM Legal Services Can Help

Defending yourself against a debt collection lawsuit is complex and stressful. MAM Legal Services provides comprehensive case operations support to help you fight back:

• Fast intake and case review: We'll review your lawsuit documents and identify potential defenses within 24-48 hours
• Professional Answer preparation: Our team prepares a thorough, legally sound Answer for attorney review and filing
• Attorney matching: We connect you with licensed attorneys in your jurisdiction who specialize in debt defense
• Full case management: We handle all the administrative work—deadlines, document organization, court filings, and communication
• Settlement negotiation support: If settlement is the right path, we coordinate negotiations and ensure agreements are properly documented

Take Action Today

Time is your enemy when you're facing a debt collection lawsuit. Every day you wait is one day closer to your response deadline. Don't let fear or uncertainty cost you your rights.

Related Articles