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What Happens When You Get Served Papers for Debt
by
JG Wentworth
•
July 23, 2024
•
8 min
There’s perhaps no bigger gut punch in the debt collection world than opening your front door or mailbox to confront an ominous envelope containing official court papers. Those documents, known as a “summons” or “complaint,” signal that one of your creditors has made the dreaded decision to sue you over those unpaid bills.
Make no mistake – receiving a debt summons isn’t something to be ignored or taken lightly. While the unpleasant realities of aggressive debt collectors constantly hounding you for payment feel agonizing enough, this court filing kicks your financial woes into an entirely new and consequential arena.
So, if you do find yourself on the receiving end of these judiciary warnings over money you owe, take a deep breath and keep reading. We’re going to walk through exactly what this development means, the urgency it demands, and the range of options you have for strategically responding.
This information is provided for educational and informational purposes only. Such information or materials do not constitute and are not intended to provide legal, accounting, or tax advice and should not be relied on in that respect. We suggest that You consult an attorney, accountant, and/or financial advisor to answer any financial or legal questions.
Understanding the process
When a creditor sues you for outstanding debt, they’re asking a court to officially rule on the alleged money owed and grant them a binding legal judgment against you. Armed with a judge’s judgment in their corner, creditors gain substantially more leverage and abilities when it comes to actively collecting on those debts.
This could include obtaining orders to garnish portions of your paycheck until the debt is fully repaid. Or allowing them to potentially seize funds from your bank accounts, put liens on any property or assets you own, or even withhold money from tax refunds, lottery winnings, and legal settlements you may receive down the line.
In other words, with a legal court judgment officially certifying your debt obligation, creditors now have a path towards super-charging their collection abilities to forcibly take money directly from wherever your income flows.
Don’t ignore it
Given the high stakes of having a judgment rendered against you, the worst possible response to receiving that summons is ignoring or avoiding it altogether. Debt collectors certainly hope you’ll miss those critical deadlines to officially respond as they’ll then move forward with getting a judgment by default.
As soon as you receive legal notices of a debt lawsuit, carefully read through all documents and note the deadline for taking action – typically around 30 days is standard for officially responding with your “answer” contesting the claims. Miss that date and the creditors win an automatic green light.
Options for your response
Just because you’ve been served debt lawsuit papers doesn’t necessarily mean all is lost and you have no choice but to concede defeat. You have a few potential routes for strategically answering and defending yourself, including:
- Pay in full – If both the debt amount and the creditor’s documentation checks out, you can settle by simply paying the full balance legally owed. Not ideal, but the quickest path to resolving the matter head-on.
- Dispute the claims – Should any details, like owing the specific amount claimed or creditor identification seem incorrect or mistaken, you can file an “answer” officially disputing those particulars through the courts. This may force the creditor to substantiate legitimacy through discovery and documentation.
- Seek a settlement – Another option is directly negotiating with the creditor’s attorney for a reasonable settlement, often less than the full debt value. If both parties agree to settlement terms and get court approval, the lawsuit is dismissed.
- Bankruptcy – If it’s looking like multiple creditors may succeed in winning judgments against you, bankruptcy presents an avenue for consolidating those debts and renegotiating all terms – or in some cases, discharging them entirely. But bankruptcy entails longer term repercussions.
Need some relief?
If your mounting debt is putting you at legal risk, you might want to consider debt relief. At JG Wentworth, we’ve helped countless individuals resolve their debt through our Debt Relief Program.* In fact, if you have $10,000 or more in unsecured debt, there’s a good chance you’ll qualify and get the JGW advantage:
- One monthly program payment
- We negotiate on your behalf
- Average debt resolution in as little as 48-60 months
- 24/7 support
- We only get paid if we settle your debt
If you think you qualify for our program, give us a call today so we can go over the best options for your specific financial needs. Why go it alone when you can have a dedicated team on your side, helping you to avoid standing before a judge?
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The bottom line
Regardless of which defense path seems optimal for your circumstances, make sure you adhere to all response timelines and notification requirements outlined in those summons documents. The court won’t delay or extend deadlines simply because you ignored them.
While getting served with legal papers may induce panic, staying calm and carefully evaluating your rights as the defendant will be critical. An experienced debt defense attorney can prove invaluable in these scenarios if you have any uncertainty about how to properly defend yourself.
Debt collectors file lawsuits because they represent a surefire way to eventually force payment through the courts. But you aren’t powerless once receiving that summons – you have rights and options for challenging or resolving those claims head-on. Careful navigation now could spare you much larger financial headaches in the long run.
About the author
* Program length varies depending on individual situation. Programs are between 24 and 60 months in length. Clients who are able to stay with the program and get all their debt settled realize approximate savings of 43% before our 25% program fee. This is a Debt resolution program provided by JGW Debt Settlement, LLC (“JGW” of “Us”)). JGW offers this program in the following states: AL, AK, AZ, AR, CA, CO, FL, ID, IN, IA, KY, LA, MD, MA, MI, MS, MO, MT, NE, NM, NV, NY, NC, OK, PA, SD, TN, TX, UT, VA, DC, and WI. If a consumer residing in CT, GA, HI, IL, KS, ME, NH, NJ, OH, RI, SC and VT contacts Us we may connect them with a law firm that provides debt resolution services in their state. JGW is licensed/registered to provide debt resolution services in states where licensing/registration is required.
Debt resolution program results will vary by individual situation. As such, debt resolution services are not appropriate for everyone. Not all debts are eligible for enrollment. Not all individuals who enroll complete our program for various reasons, including their ability to save sufficient funds. Savings resulting from successful negotiations may result in tax consequences, please consult with a tax professional regarding these consequences. The use of the debt settlement services and the failure to make payments to creditors: (1) Will likely adversely affect your creditworthiness (credit rating/credit score) and make it harder to obtain credit; (2) May result in your being subject to collections or being sued by creditors or debt collectors; and (3) May increase the amount of money you owe due to the accrual of fees and interest by creditors or debt collectors. Failure to pay your monthly bills in a timely manner will result in increased balances and will harm your credit rating. Not all creditors will agree to reduce principal balance, and they may pursue collection, including lawsuits. JGW’s fees are calculated based on a percentage of the debt enrolled in the program. Read and understand the program agreement prior to enrollment.
JG Wentworth does not pay or assume any debts or provide legal, financial, tax advice, or credit repair services. You should consult with independent professionals for such advice or services. Please consult with a bankruptcy attorney for information on bankruptcy.
