Now What Should I Do?

I just received a letter from a debt collector or attorney. Now what should I do?

So you received a letter from a debt collector.  Now what?  Do what will protect your rights.

Debt Collection Letter

debt collector, for the purposes here, is a debt collection firm; a law firm; or a lawyer trying to collect the debt.  After you receive the first written communication from a debt collector (usually a letter), you should, within 30 days of receiving that communication, send a letter to the debt collector that includes the following:

Make sure your letter to the debt collector is mailed to the debt collector’s proper address.

Make sure your letter to the debt collector includes the current date.

Make sure your letter to the debt collector includes copy of the initial communication (the letter from the debt collector to you).

Make sure your letter to the debt collector includes a letter, note, Post-it™ note, etc., stating the following:

“This alleged debt, or at least some portion of it, is disputed.”
“Furthermore, I request the name and address of the original creditor.”

You do not need to include any other information, but you do need to keep a copy of everything that you send to the collector. If you send the letter requesting a return receipt or proof of delivery, which you should do unless you simply cannot afford it (it is not required by law, but it still helps), keep a copy of the return receipt.

Keep the original letter you received as well as the envelope it came in. And again, make a copy of everything you send to the debt collector.

Once you do this, if you hear from the debt collector again (in any manner – by telephone, letter, etc.) before the debt collector validates the debt, the debt collector has violated the law.

Also, remember that this only applies to the person sending you the letter. If the person who sends you the letter subsequently transfers the debt to someone else, and that someone else writes you a letter, you must do everything above for that new person as well.

If the letter comes back to you for any reason, do not open the letter. Keep the entire sealed envelope for your file.

A debt collector (or creditor) has sued me. Now what should I do?

First of all, do not panic.  When you get sued in a civil action, like this, it is nothing to be terribly concerned about.  It happens to millions of Americans every year and they survive it just fine – you will too.

To begin with, this is a complex issue, and you need a lawyer.  We will speak with you for free about the lawsuit, so it does not hurt to call us (at 619-233-7770).  Further, you can also fill out one of our easy to use forms on this website, and an attorney will call you back.  You can do that by clicking on this sentence.

If you choose not to do that, which is probably a mistake, the short answer is that when a debt collector files a lawsuit against you to collect a debt, you generally want to respond to the lawsuit, either personally or through your lawyer, by the date specified in the court papers to preserve your rights.

The Legal Process

On the witness stand

A trial lawyer recently had to testify in a civil action. This lawyer was experienced, intelligent and motivated to testify clearly, completely and truthfully. But while he was testifying on direct examination, answering questions asked by his own lawyer, he could not tell for sure what facts his own lawyer wanted. “I had no idea where we were going.”

If an attorney-witness cannot read the examining attorney’s mind, imagine the difficulty facing the average witness. More nervousness, less familiarity with the elements.  Presenting a guessing game is the wrong way for a witness to testify. We try to consider the most effective way to prepare for direct examination.

Often, we write out, for each witness, each question we intend to ask, and each expected answer, in the order for trial testimony.

The expected answers come from prior interviews with the witness. Preparing the question and answer memorandum forces the trial attorney to organize. We will decide which facts to introduce from which witness and in what order.

Moreover, we write into this question and answer memorandum the exhibits to be introduced, and at what point from what witness. In a State court case, with no pre-admission of exhibits, the foundational questions can be organized and written into the memorandum. Potential objections are eliminated.

Some attorneys believe that this is too much work. We do not.

Before trial, when normally meet with a witness and use a question and answer memorandum to go over the testimony. Inevitably, we discover weak spots, confusion over what we are asking, and the need to improve. After revision, we go over it again.

No witness will testify completely in accordance with your expectation. But our presentation will be much smoother and complete. Witnesses are often nervous, but much less so when every question on direct will be a question the witness has heard before.

What is negligence?

Negligence is the failure to exercise proper or ordinary care. A person who has committed negligence in some way failed to act in the manner that a reasonable person would have acted in the same situation. A person who commits negligence has or had a legal obligation to act in a certain manner but failed to do so.

What is consumer fraud?

Consumer fraud occurs when companies, individuals or organizations violate laws designed to protect consumers. Those consumer protection laws are designed to prevent inferior, hazardous and falsely marketed products from entering the marketplace. Consumer fraud can happen in person (such as in a store), by telephone (such as through telemarketers) or on the Internet.

What is the statute of limitations?

The statute of limitations sets out the time period during which legal action can be taken. In civil litigation, that period is normally a set amount of time that begins running either when harm has occurred or when the victim knew or should have known that harm was done. The statute of limitations varies from state to state and depending on the type of lawsuit being filed. For example a personal injury statute of limitations might be different from a product liability statute of limitations. Furthermore, if the injured party was minor when the harm occurred, the statute might not start running until the minor turns a certain age.

What is the difference between civil law and criminal law?

Civil and criminal law are two separate areas of law with different goals and different burdens of proof. In civil law, the goal is to make the plaintiff whole in situations where a party is deemed to have acted improperly. In criminal law, the goal is to punish the wrongdoer and reform him if possible. Civil law governs disputes between two parties where one party is legally responsible for the harm done to another. Criminal law deals with crimes against society. In civil law, an individual files a lawsuit against another party. In criminal law, the government files charges against the wrongdoer.

What is a lawsuit?

A lawsuit is a civil action brought in court in which a party, known as the plaintiff, who claims to have suffered damages at the hands of another party, known as the defendant, seeks remedy for those damages. Damages awarded to a plaintiff can include statutory damages, compensatory damages, and/or punitive damages.

Class Actions

What is the difference between an opt-in and an opt-out lawsuit?

In an opt-in lawsuit, you must notify the courts of your desire to be included in the class of people covered by a class action lawsuit. In an opt-out lawsuit, you are automatically included in the class, regardless of whether or not you want to be. If you want to be excluded from the class, you must make your wishes known to the courts.

Does my complaint affect enough people in a similar manner to make a class action worthwhile?

In many cases, it’s difficult to know this until people contact lawyers to discuss their legal options. Lawyers often have a good idea from the outset of how many people are affected by your claim. They cannot, however, predict how many people are interested in joining a lawsuit. If you have a complaint against a company, your best bet is to discuss your options with a lawyer.

Is my complaint eligible for a class action?

It depends on how many other people were harmed by the same company. For example, if you lost $100 to improper billing by a cell phone company, that is probably too small an amount for you to go to court over. If, however, 1,000 people suffered the same damages, that works out to $1,000,000, which could make a class action lawsuit worthwhile.

I have taken a medication and believe I suffered side effects but have not been diagnosed with anything. Can I still fill out a claim?

You can still fill out a claim form, although it’s a good idea to speak with a doctor about potential side effects, especially if it is a side effect that resolves once you stop taking medication. Even if you have not been diagnosed, however, you can fill out a claim form. An attorney may be able to determine if you’re still eligible to join a lawsuit and may also be able to tell you what diagnostic tests, if any, should be conducted.

I submitted a claim for a class action settlement, but haven’t heard anything since. Why is it taking so long? I thought I’d have a check in the mail by now.

Because a class action lawsuit typically involves hundreds or thousands of claimants, it can take several months for a class action settlement fund to be dispersed to claimants. Typically, Claims Administrators will provide updates regarding the status of settlement payments either on their website, or via a toll-free phone number.

I don’t understand my Class Action Notice of Proposed Settlement—what am I supposed to do with it? Where do I go for help?

Your Class Action Notice of Proposed Settlement will list a Claims Administrator—and usually a toll-free phone number or website address where you can find information about the class action lawsuit and the terms of the proposed settlement.

How do I become a lead plaintiff in a class action?

The lead plaintiff acts as a representative of the class and is appointed by the court. That person then communicates with lawyers about the case and may be required to offer testimony about how he or she was harmed by the defendant’s actions. The lead plaintiff may also be required to make decisions that affect the outcome of the case. To be named lead plaintiff, you must apply within 60 days after a notice of the first class action is published.

The class action lists a lead attorney on the case—is that who my claim form goes to?

No. Your claim form will go to the Claims Administrator who has been contracted to handle all claims for the class action settlement.

Can I use my own lawyer in a class action lawsuit?

Yes—if you have opted out of the class (or not opted into the class if a formal opt-in notice needed to be submitted). If you join the class—or do not opt out of it—then you will be represented as part of the class and lose the option to file an individual lawsuit against the defendant.

How is a class action different from a mass tort or an ordinary lawsuit?

In a class action lawsuit, the plaintiffs are grouped together in one lawsuit against the defendant. In this form of legal action, the lawsuit is filed on behalf of everyone in the class, that class being a group of people who share similar circumstances, injuries and damages. To be part of a class action, the plaintiff must show that his experience with the defendant is similar to that of other people in the class. Plaintiffs must also show that the evidence against the defendants is similar for everyone in the class and that individual lawsuits against the company would not be an efficient use of the court’s time, nor would it be cost-effective.

In a mass tort, a defendant is sued by a large group of people, but those people actually retain their individual lawsuit rather than becoming part of a “class”. An attorney or group of attorneys can represent multiple injured parties in their individual cases and plaintiff’s lawyers can share information. Cases that are similar can then be argued together.

Defective drug lawsuits are often mass torts because plaintiffs may have suffered different damages from the drug—for example a person taking a drug may have suffered a fatal heart attack while another suffered a minor stroke—and based on their different injuries, their awards would likely be different. Large-scale accidents, such as plane crashes are also argued as mass torts.

What is a multi-district litigation (MDL)?

A multi-district litigation is a procedure that allows civil lawsuits, which were pending in different federal district courts and have at least one common question of fact, to be transferred and consolidated for pretrial proceedings before one judge.

What is a class action lawsuit?

A class action lawsuit is an action in which a large group of people files a complaint against the defendant for similar grievances. In this form of legal action, the lawsuit is filed on behalf of everyone in the class, that class being a group of people who share similar circumstances, injuries and damages. To be part of a class action, the plaintiff must show that his experience with the defendant is similar to that of other people in the class. Plaintiffs must also show that the evidence against the defendants is similar for everyone in the class and that individual lawsuits against the company would not be an efficient use of the court’s time, nor would it be cost-effective. Finally, the individual compensation from the class action must be small enough that it is not worth the time or money to hire an individual attorney.


What kind of damages are there?

Statutory damages

Statutory damages includes money awarded simply because someone violated a statute.  They are presumed damages.

Compensatory damages

Compensatory damages includes money awarded to make the plaintiff “whole”, meaning to replace what was lost when the plaintiff was harmed by the defendant. These damages must be to compensate for a quantifiable loss. For example, in a car accident, compensatory damages would cover the loss of a totaled vehicle.

Punitive damages

Punitive damages are awarded to the plaintiff to punish the defendant for wrongdoing and to deter other parties from acting in a similar manner to the defendant. Punitive damages are awarded in cases of malicious or willful misconduct and are above and beyond compensatory damages.

Debt Collection Issues

Who is a debt collector for the purposes of the FDCPA?

There has been a great deal of litigation on this issue.  Debt collectors would rather find a technicality that says they are not debt collectors than actually obey the law.  The FDCPA defines “debt collector” as “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.”

But what does that mean?  A good general answer is that a debt collector under the FDCPA is any lawyer trying to collect a debt or representing one who is trying to collect a debt; any third party debt collector; any company that purchased the debt from another and who is now trying to collect it; and in some circumstances, even the original creditor.

How much do debt buyers pay for these debts?

The Ninth Circuit Court of Appeals recently found that “most debt buyers acquire the debts for a fraction of the balance, but then attempt to collect the entire debt.”  See Gonzales V. Arrow Financial Services, No. 10-55379, (9th Cir. 2011).  See also, Id., Footnote 1, stating, “See Robert M. Hunt, Collecting Consumer Debt in America, FED. RES. BANK OF PA BUS. REV. 15 (2007) (estimating that the average price for purchase of an obsolete debt at $0.045 per dollar), available at 2007/q2/hunt_collecting-consumer-debt.pdf; see alsoAdam J. Levitin, Hydraulic Regulation: Regulating Credit Markets Upstream, 26 YALE J. REG. 143, 192 (2009) (noting the sizeable growth in the debt buying industry).

Where can I learn more about debt collection issues?

To learn more about debt collection and other credit-related issues, contact  Hyde & Swigart, or fill out a free evaluation, or visit and, the U.S. government’s portal to financial education.

The FTC works to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. To file a complaint or get free information on consumer issues, visit or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. Watch a video, How to File a Complaint, at to learn more. The FTC enters consumer complaints into the Consumer Sentinel Network, a secure online database and investigative tool used by hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

Where do I report a debt collector for an alleged violation?

Report any problems you have with a debt collector to your state Attorney General’s office ( and the Federal Trade Commission ( Many states (like  California) have their own debt collection laws that are different from the federal Fair Debt Collection Practices Act. You can benefit from all these laws, cumulatively.  Your Attorney General’s office can help you determine your rights under your state’s law.

However, reporting a debt collector to the government isn’t enough.  You need to get the advice of a consumer rights attorney.

What should I do if a debt collector sues me?

If a debt collector files a lawsuit against you to collect a debt, respond to the lawsuit, either personally or through your lawyer, by the date specified in the court papers to preserve your rights.

Do I have any recourse if I think a debt collector has violated the law?

You have the right to sue a collector in a state or federal court within one year from the date the law was violated. In some jurisdictions, it is within one year from when you first became aware the  debt collector acted as it did.  If you win, the judge can require the collector to pay you for any damages you can prove you suffered because of the illegal collection practices, like lost wages and medical bills. The judge can require the debt collector to pay you up to $1,000, even if you can’t prove that you suffered actual damages. You also will be reimbursed for your attorney’s fees and court costs. A group of people also may sue a debt collector as part of a class action lawsuit and recover money for damages up to $500,000, or one percent of the collector’s net worth, whichever amount is lower. But remember, even if a debt collector violates the FDCPA in trying to collect a debt, the debt does not go away if you owe it (although it can often be waived as part of a lawsuit related settlement.)

Can a debt collector garnish my bank account or my wages?

If you don’t pay a debt, a creditor or its debt collector generally can sue you to collect. If they win, the court will enter a judgment against you. The judgment states the amount of money you owe, and allows the creditor or collector to get a garnishment order against you, directing a third party, like your bank, to turn over funds from your account to pay the debt.

Wage garnishment happens when your employer withholds part of your compensation to pay your debts. Your wages usually can be garnished only as the result of a court order. Don’t ignore a lawsuit summons. If you do, you lose the opportunity to fight a wage garnishment.

Can I control which debts my payments apply to?

Yes. If a debt collector is trying to collect more than one debt from you, the collector must apply any payment you make to the debt you select. Equally important, a debt collector may not apply a payment to a debt you don’t think you owe.

Is the right to garnish limited?

Yes.  A debt collector must first take you to trial, and win in court.  Further, many federal benefits are exempt from garnishment, including:

  • Social Security Benefits
  • Supplemental Security Income (SSI) Benefits
  • Veterans’ Benefits
  • Civil Service and Federal Retirement and Disability Benefits
  • Service Members’ Pay
  • Military Annuities and Survivors’ Benefits
  • Student Assistance
  • Railroad Retirement Benefits
  • Merchant Seamen Wages
  • Longshoremen’s and Harbor Workers’ Death and Disability Benefits
  • Foreign Service Retirement and Disability Benefits
  • Compensation for Injury, Death, or Detention of Employees of U.S. Contractors Outside the U.S.
  • Federal Emergency Management Agency Federal Disaster Assistance

Further, even after a  debt collector wins in court, the amount of wages are limited, and may be limited even further by the court.

But federal benefits may be garnished under certain circumstances, including to pay delinquent taxes, alimony, child support, or student loans.

What are unfair debt collection practices?

Debt collectors may not engage in unfair practices when they try to collect a debt. For example, they may not:

  • try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge;
  • deposit a post-dated check early;
  • take or threaten to take your property unless it can be done legally; or
  • contact you by postcard.

What else are debt collectors prohibited from saying?

Debt collectors also are prohibited from saying that:

  • you will be arrested if you don’t pay your debt;
  • they’ll seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so; or
  • legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action.

What are false, deceptive, and misleading statements?

Debt collectors may not lie when they are trying to collect a debt. For example, they may not:

  • lie to you;
  • falsely claim that they are attorneys or government representatives;
  • falsely claim that you have committed a crime;
  • falsely represent that they operate or work for a credit reporting company;
  • misrepresent the amount you owe;
  • indicate that papers they send you are legal forms if they aren’t;
  • indicate that papers they send to you aren’t legal forms if they are;
  • give false credit information about you to anyone, including a credit reporting company;
  • send you anything that looks like an official document from a court or government agency if it isn’t;
  • use a false company name; or
  • many other things.

What is debt collector harassment?

Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, they may not:

  • use threats of violence or harm;
  • publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies);
  • use obscene or profane language;
  • repeatedly use the phone to annoy someone; or
  • many other things.

What does the debt collector have to tell me about the debt?

Every collector must send you a written “validation notice” telling you how much money you owe within five days after they first contact you. This notice also must include the name of the creditor to whom you owe the money, and how to proceed if you don’t think you owe the money.

Can a debt collector contact anyone else about my debt?

If an attorney is representing you about the debt, the debt collector must contact the attorney, rather than you. If you don’t have an attorney, a collector may contact other people – but only to find out your location information. Collectors usually are prohibited from contacting third parties more than once. Other than to obtain this location information about you, a debt collector generally is not permitted to discuss your debt with anyone other than you, your spouse, or your attorney.

How can I stop a debt collector from contacting me?

If a collector contacts you about a debt, you may want to talk to him at least once to see if you can resolve the matter – even if you don’t think you owe the debt, can’t repay it immediately, or think that the collector is contacting you by mistake.  If you decide after contacting the debt collector that you don’t want the collector to contact you again, tell the collector – in writing – to stop contacting you. Here’s how to do that:

Always make a copy of your letter.  Send the letter to the debt collector.  You may want to send the letter by certified mail if you like, and pay for a “return receipt” so you’ll be able to document what the collector received, but that is not required.  Once the collector receives your letter, they generally may not contact you again.  Sending such a letter to a debt collector you owe money to does not get rid of the debt, but it should stop the contact.  The creditor or the debt collector still can sue you to collect the debt.

Can a debt collector contact me any time or any place?

No. A debt collector may not contact you at inconvenient times or places.  This is presumed to be before 8 in the morning or after 9 at night, but you decide what is convenient , not the  debt collectors.  And collectors may not contact you at work if they’re told (orally or in writing) that you’re not allowed to get calls there.

What types of debts are covered by the FDCPA?

The Act covers personal, family, and household debts, including money you owe on a personal credit card account, an auto loan, a medical bill, and your mortgage. The FDCPA doesn’t cover debts you incurred to run a business.

Debt Defense Issues

How much do debt buyers pay for these debts?

The Ninth Circuit Court of Appeals recently found that “most debt buyers acquire the debts for a fraction of the balance, but then attempt to collect the entire debt.”  See Gonzales V. Arrow Financial Services, No. 10-55379, (9th Cir. 2011).  See also, Id., Footnote 1, stating, “See Robert M. Hunt, Collecting Consumer Debt in America, FED. RES. BANK OF PA BUS. REV. 15 (2007) (estimating that the average price for purchase of an obsolete debt at $0.045 per dollar), available at 2007/q2/hunt_collecting-consumer-debt.pdf; see alsoAdam J. Levitin, Hydraulic Regulation: Regulating Credit Markets Upstream, 26 YALE J. REG. 143, 192 (2009) (noting the sizable growth in the debt buying industry).

Should I talk to an attorney about my case?

We encourage you to contact us for a free consultation about your debt defense strategy.

What Happens if I Win the Lawsuit?

If you win, it means the court has decided that you do not owe the debt that the collectors sued you for. They must remove the debt from your credit report. Of course, they rarely do this without being pushed. We will push them.

Do I Have to Answer the Lawsuit?

Many people just ignore debt collection lawsuits. They assume that there is nothing they can due to fight them. When they ignore the lawsuit, a default judgment is entered against them. Not only does this look bad on a credit report, it entitles the debt collectors to take further legal action to get the money, including repossession and wage garnishments.

A better debt defense strategy is to file an answer to the lawsuit and fight back. Our attorneys are here to help. We can assess your case and explain your options.

Is It Legal for a Debt Buyer to Sue Me?

In most cases, it is legal, provided they can prove they now own your debt. But this is something that they often have difficulty proving. In some cases, even if they own the debt and can prove it, they may have violated consumer protection laws while trying to collect from you.

Who Is Suing Me?

Surprisingly, the majority of debt collection lawsuits are not filed by the creditor that you initially owed the debt to. Instead, these lawsuits are filed by debt buyers. Debt buyers are companies that buy up debt and then go to great lengths to collect the balance. Those efforts include filing lawsuits.

General Consumer Issues

Habla usted español?

Nuestros abogados se encuentran disponibles para atender consumidores de cualquier parte de California y Arizona.

Servicios Legales proporcionados en Ingles y Español.

Adicionalmente al ingles, nuestro bufete jurídico incluye miembros del staff y abogados que pueden ofrecerle asistencia en español.


Our lawyers are available to serve consumers anywhere in California or Arizona.

Legal Services Provided in English and Spanish.

In addition to English speakers, our firm includes staff members and attorneys who are able to offer assistance in Spanish.

What should I know before retaining a lawyer?

The following are some questions to ask a lawyer before entering into a formal agreement. Although in some cases, the answers may be general, the attorney should be willing to answer all your questions and ensure you fully understand how the law applies to your situation. If one lawyer does not take your case, it does not mean you don’t have a case. You may have to try a few lawyers before finding one who will represent you. You also do not have to agree to work with the first lawyer who accepts you. Make sure you hire someone you feel will adequately represent you and work to ensure your best interests are protected.

  • What experience do you have in this area?
  • How many cases similar to mine have you handled in the past two years? What have the results of those cases been?
  • Are you working on my case or will a junior attorney or paralegal?
  • What is your fee structure? How often will I be billed?
  • Do you have a general estimate of what this will cost?
  • How will you inform me of developments in my case?
  • What services will you provide?
  • What is your time line for this case?
  • What are the possible outcomes of this trial and how will they affect me?
  • How do you feel about alternative dispute resolution?
  • What are some potential factors that could complicate my case and how will they affect the timeline and cost?

What set of facts determines the statute of limitations?

The statute of limitations for a debt is normally the statute of limitations where the case is filed.  However, the statute of limitations for a debt can be set in a contract with a choice of laws clause.  A credit card issuer can write a clause that says something to the effect that, “If a dispute arises from this contract, we agree to use the laws of Delaware.”  Any statute of limitations analysis should include a review of the contract the consumer signed.



Hyde & Swigart has helped thousands of consumers in Colorado, Minnesota, Arizona, California and Texas with their legal issues, and we have never seen two cases that were identical. We also have attorneys who have helped consumers in Florida, Michigan, Nevada, New York, Oregon, Wisconsin, Washington, and Washington, D.C. You should never assume your situation is the same as something that is described on this web site, or that you read elsewhere on the Internet. Each situation is unique, and in our opinion, each situation needs to be thoroughly and independently reviewed by a competent consumer rights attorney. While we are happy to do that for you for free, we cannot do that solely on this web site. Even our evaluation forms are mere starting points. You should never assume your case, your situation, or your set of facts, are covered in their entirety by this web site. If you have questions about your potential case, we will be glad to discuss them with you at no charge. However, do not act, or fail to act, simply because of something you read or see on this web site. Click here to read more.