Credit Cards

August 7, 2017

Defending Credit-Card Borrowers in New York

Every year, thousands of lawsuits are brought in New York State to collect on credit-card debt. But only a fraction of the borrowers who are sued enlist an attorney to defend them; as a result, many have a default judgment entered against them.

Debt-collection activity should not be ignored, just because it can lead to a default judgment. The amount will include principal and interest, but also court costs, late fees, and attorney’s fees. And once entered, the judgment will be more expensive to remove—if it can be removed at all—than it would have been for the borrower to have hired an attorney originally.


The Borrower’s Defenses:

In many debt-collection cases, the borrower has good grounds for defending herself. One reason is that most debts that are in default are not enforced by the original lender, but by a party who bought the debt. That can work to the borrower’s advantage, because the debt-buyer often possesses scant evidence that the debt is valid, or that the buyer actually owns the debt. By requiring the supposed debt-holder to prove its case with documentary evidence, a borrower can sometimes get the case against her dismissed.

Other defenses to a collection suit exist as well. Although a person may legitimately owe money on a credit card that she once owned, not all debt-collection activities are legitimate. A borrower may pay an old debt without realizing that the creditor used an illegal collection technique. Or she may pay an old debt when the deadline for suing on it (the statute of limitations) has expired. Illegal collection practices and statute of limitations are two more defenses that a borrower can use to stymie a collection suit.

Because the borrower may have good defenses, credit-card debt can often be reduced through negotiation. The debt-holder may be willing to lower its demand because typically, it paid pennies on the dollar for the debt, so it can accept less than the full debt amount and still make a profit.

But for a borrower to assert her defenses effectively so that the debt-holder is motivated to negotiate, she must have an able attorney.


Expert Help with Credit-Card Debt:

A borrower’s attorney should understand how debt collectors gather data to use against a borrower. The attorney should know what weaknesses to look for in debt-collection practices, and she should be able to spot collector misconduct that can be used to counter-sue the debt-holder. The lawyer should also be familiar with consumer-protection trends in other states, because she may be able to influence a New York judge by citing such a trend.

Attorney Stephen A. Katz is available to oppose wage garnishment, move to vacate a default judgment, and defend a borrower in other ways. Attorney Katz can negotiate with a creditor, and has on occasion succeeded in having a debt totally forgiven.

Attorney Katz is available to provide a free initial consultation to a borrower seeking help. He can be reached at (800) 251-3529.

Attorney Katz can be reached at (800) 251-3529