Debt Collection Lawsuits Often Have Errors

by John Skiba
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Debt Collection MistakesA recent review of debt collection lawsuits filed by J.P.Morgan Chase found that there was inaccurate information contained within the debt collection cases about 9% of the time.  The errors included things like suing for a balance greater than what was owed, inaccurate interest rates, and excessive fees.

Further, it was found that in some cases sworn documents (like an affidavit) were signed even though the person signing it had no knowledge whether the information in the affidavit was accurate.

Some may think that 9% isn’t that high of a number, but when considering that J.P.Morgan Chase bank filed more than 100,000 lawsuits against its customers between 2008 and 2011, that means that nearly 9,000 households were impacted by a debt collection lawsuit that had substantial errors.  And that is just in one state.

This investigation was spurred on by a 2010 lawsuit that was filed by a former J.P.Morgan Chase vice president who alleged that Chase employees had signed stacks of affidavits without even looking at the underlying documentation.  Further, she alleged that in one portfolio 50% of the cases were missing adequate documentation.

Most Debt Collection Lawsuits Lack Sufficient Proof

The errors in the Chase lawsuits are at 9%.  When these debts are sold to third parties like Midland Funding, Asset Acceptance, Portfolio Recovery, or LVNV Funding, the error rate skyrockets.  Based upon my own experience in handling these type of debt collection lawsuits on a daily basis, it is the rare case that I see where there is actually documentation to support the case brought by the junk debt buyer.

And that is why if you have been sued by one of the debt buyers it is important to put up a fight.  Too many people simply don’t respond and the debt buyer is given a default judgment.  Some estimates put the number of default judgments on debt buyer lawsuits at 98%!

When a debt buyer files a collection lawsuit they carry the burden of proving their case.  If you don’t respond the courts typically give them everything they are asking for.  If you have been sued, reach out to an attorney.  Educate yourself on this process.  And then hold the debt buyer’s feet to the fire.  More often than not they won’t have anything close to adequate evidence to support their case.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© John Skiba, Arizona Consumer Law Group, PLC | Attorney Advertising

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