Credit card companies and debt buyers regularly sue New York consumers. Often these cases, especially those initiated by debt buyers, are frivolous. These companies buy allegedly unpaid debts from other lenders for pennies on the dollar and then they file lawsuits against the consumer to try to collect the debt. The state attorney general cracked down on this practice, and the crackdown showed that these businesses were obtaining millions of dollars in illegitimate judgments against consumers.

Credit Card Companies and Debt Buyers Sue Many People
The New York Times reports that the Federal Reserve Bank of New York has found that one in seven adults in the United States is currently being pursued by a debt collector. Between 2006 and 2009 debt buyers bought up 90 million consumer accounts valued at roughly $143 billion.

The Problem of Default Judgments
A shocking 95% of debt collection lawsuits result in what are called “default judgments” against borrowers. These default judgments are automatic victories by the credit card companies and debt buyers. They happen when the person who is accused of owing the debt does not show up to court. This can happen because a borrower is simply trying to avoid a debt collector, or because he or she does not understand or know that a court appearance is required. This is problematic not only for those people who claim they do not owe any debt at all. It can also be a problem for those who acknowledge that they owe something, but who disagree with the debt collector about the total amount owed. A default judgment can result in your wages being garnished or your bank accounts being frozen. This means that it is extremely important to get an attorney involved on your side as soon as possible. Even if a default judgment has already been entered you should still contact us because we may be able to get the judgment set aside under some circumstances.

New York Debt Buyer Regulations
The New York Department of Financial Services recently enacted some of the strongest consumer protection regulations in the United States when it comes to debt collection. These new regulations include debt buyers as regulated debt collectors. The new laws will affect the initial disclosures made to consumers about both the debt and their rights. It will also require them to be clear about the statute of limitation and inform the consumer if it has reason to believe that it may have expired.

Possible Defenses to Debt Buyer and Credit Card Lawsuits
Every situation is different, so every defense in one of these cases is different. Some defenses come up more often than others, however. One common one is the statute of limitations defense mentioned above. This defense comes into play when the debt collector waits too long to sue and its right to sue has expired under the law. Another common defense is that the debt buyer has not provided the proper paperwork to establish the original agreement to pay. In the case of credit cards this is often the cardmember agreement, which debt buyers often do not obtain when they buy the debts. These defenses show that even if you do not realize you have a defense, you may actually have one. That is what makes it so important that you speak with an attorney rather than just allowing a default judgment to be issued and allowing your wages to be garnished.

Call Bromberg Law Office, P.C.
If you are involved in a New York credit card or debt buyer lawsuit, you will need the help of a consumer protection attorney. The Bromberg Law Office can be of help. Email us, or call today at (212)248-7906.