What to Do if Sued

Sued for Debt

So You’re Being Sued for Debt

You have learned, one way or another, that you are being sued for a debt. If so, you are in a club containing many millions of people, but you probably feel all alone. What do you do? And how do you do it? Where do you turn, and who can help?

Since you’re here, you know that WE can help. We help people beat the debt collectors and protect what’s theirs.


We don’t make any bones about it – we think that if you’re sued by a debt collector you have a great chance of winning. And if you lose, it hardly ever costs you anything more than not fighting would have done. If you want to settle, you always start by fighting because debt collectors never settle to make YOUR life easier, they only settle make themselves more profit, and if you fight you instantly drive the value of the suit down in their eyes. Thus you have everything to gain and little to lose in most situations. You should fight.

Lawyer or Not?

We’ve addressed this question many times in various posts, and we do in our First Response Kit, too. But for this article we’re just going to talk about the cost of a lawyer. For most of our members, the cost of a lawyer is the most important thing, and they are expensive.

The average lawyer in a city tries to make $200 per hour these days. They’re running a business, have a staff, and need to make a profit. In debt defense, they also know that not everyone is able to pay. Thus, those who do pay, have to pay more.

With $200 per hour as a target, the lawyer either has to charge you that as an hourly rate or create a flat fee that will, she hopes, bring that average return. Through it all, most people discussing legal fees with us say that lawyers are trying to get them to pay at least $2,500 for their cases. For most people, this is simply too much, and the lawyer will want much of that up-front. So lawyers are simply out of reach for most people in debt trouble.

But here’s the thing: debt law, unlike most kinds of law, is well-suited to pro se (self-representation) defense. And with a little help from us, you’ll know more than most lawyers you talk to will know about this kind of law anyway.

Debt Law is Good for Pro Se Defense

There are a few reasons debt law is good for pro se defense. First, debt law is mostly about rules of evidence. They’re going to want to get some records into evidence, and you’re going to want to stop them from doing that. If you can keep those records out and avoid a few basic mistakes, you should win. This is not the kind of law that involves extensive testimony or cross-examination – you won’t need to be brilliant. You will need to do basic things that you can learn – we can teach you.

The other main reason debt law is good for self-representation is economic. They want to make $200 per hour, but you don’t have to get that much. And the debt collector/lawyer is trying to get that from half of what he can collect from you (the debt buyer gets the other half), while you’re saving 100 percent of what you can save. Thus you can spend more time on the case. It’s your life, and it matters more to you than anyone else. Every time you do something to defend yourself the lawyer on the other side will be worried about whether she’ll get paid for working on your case – this is a big, big advantage.

What to Do?

Your defense will start with an answer or a motion. Our First Response Kit will guide you through that. We also suggest that you get right onto the process of discovery, and the First Response Kit will do as much to help make that easy for you as possible. It includes samples of all the documents you’ll probably need. You’ll have to do SOME work for sure, but it doesn’t get any easier for you than this.

Our First Response Kit

A great place to start your defense is our First Response Kit. It helps you consider your chances of winning (vs. not fighting at all) and whether to fight, whether to get a lawyer, and if you’re going to represent yourself, how to do that. We get you started with a sample Answer and sample discovery that you can modify to fit your situation. This is as easy a way to get started with your defense as is possible. Read about it here.

California Debt Law

California State-Specific Materials

This will be a long-term project, as we begin to write more articles that will address issues that arise in specific states. We will eventually have member-only material catalogued here for greater convenience.

California-specific Articles and Videos

A powerful weapon in fighting debt collectors in California – the bill of particulars

Demanding a Bill of Particulars in California, Part 2
If you are in California, you have a powerful tool against the debt collectors – a request for a bill of particulars

California-specific Products

California Bill of Particulars Pack – Californians have a tool, halfway between pleadings and discovery, that can force debt collectors to provide all the information you need to defend yourself from most of their claims. The bill of particulars will often make them drop all or part of their case – or to give you what you need to hammer them in court.

Diamond Memberships

Why you Should Join us as a Diamond Member

Diamond Membership is our best deal for people with a lot of curiosity, more than one lawsuit, or who are coaching or helping others in their cases. That’s because a main goal of Diamond membership is to go beyond the usual questions presented by debt law and the debt industry. We look at the politics and economics driving our country. And we look deeply at the law.

As anyone knows who has read our materials, most of debt law is what we call “factory work.” It’s routine and standardized, and this is simply because debt is bought and sold in gigantic deals (called “tranches”). So the average debt collector buys a hundred or a thousand (or many, many more) accounts that supposedly owe money from the same company (usually a credit card-issuing bank) and then, completely relying on the records the bank provides, harasses the people involved to collect as much as possible. And eventually they file many, many lawsuits that look almost exactly the same.

So for most of our purposes, we can simply deal with that large body of identical suits and create responses to them. They’re doing factory work, and we do something very similar.

Going Deeper and Further

But there can be more. While debt collection is generally pretty standardized, there are things that can come up that either present special challenges or issues. And in fact, for all of its routine, most debt lawsuits CAN veer out of the normal. There are always angles in every case, which can sometimes make a difference, and often make things more interesting.

You’ll get a 50% discount off all of our motions packs and other materials. We highly recommend the First Response Kit as a way to simplify your first several steps in this litigation, and you’ll get a 50% discount off the cost for that.

And some of our members like to help others. For these – for people helping others, and for those who want to know a LOT about the law – our Diamond Membership is great.

Special Tactics

When you take on debt negotiation, debt litigation and credit repair at the same time, you discover that some of the tools work for more than one thing. For example, if a debt collector is bugging you AND has damaged your credit, you can dispute the collector’s action both through the Credit Reporting Act and the Fair Debt Collection Practices Act. These two acts have different purposes (as laws) and requirements. Verification under the two acts is different, and verification under the Credit Reporting Act is more difficult and rigorous for the debt collector – and the CRA also gives you a way to attack the original creditor as well if it is reporting you.

And you can, of course, you can use any and all the information you get through either the FDCPA and CRA (also called the FCRA, for “Fair Credit Reporting Act”) in litigation if they sue you. And you can use any information you get in a lawsuit they – or you – file, in attacking their responses under the FDCPA or FCRA. In other words, knowing all three sets of rules can sometimes be very, very helpful. Our Platinum Membership opens some of those ways up to you.

Other Benefits

As with each of the Gold Memberships, you will receive special reports and offers. As a Diamond Member, though, you get them all. This includes:

  • The Three Weaknesses Almost All Debt Collectors Have
  • Take Control of Your Life and Debt; and
  • a discount off the prepaid legal program we offer our members;
  • all the situation products (like motions packs and the other products like that).

Diamond Benefits

In addition to everything the Gold and Platinum members get, Diamond members get a lot more information. They get, basically, all of our reports and books as well as ecourses. This includes our reports like Got Debt? and What if I (think I) Really Owe, Do You Need a Lawyer, and all the rest. And it also includes our book – now being revised – called Special Issues in Debt Litigation. This book was originally about a 250 page book, but it is being revised into several smaller volumes now. Diamond Members will get them, free.


In addition to the written materials, Diamond members will get their own teleconferences when the situation calls for it. As we approach our membership goals, the Diamond members will need to discuss things in greater depth and at greater length – they’ll get that opportunity. And there will be other materials, currently in the works, to help them organize, promote, analyze, and all the other things they’re likely to need.

How You Purchase

You buy by clicking on “Register” under “About Memberships” in the main menu and choosing the level of membership you want.

Diamond membership costs $25.00 per month with a $150 sign-up fee.

Platinum Memberships

Platinum Memberships combine all three of the Gold Memberships into one package.

As we often say, debt problems generally travel in crowds – that is, if one debt collector is suing you, others are probably harassing and getting ready to sue you – and still others are messing up your credit report. It’s tempting to try to focus on just one of these things at a time, and that can work. But a more effective way of dealing with debt problems is to take them all on at the same time. So even while you’re beating the debt collector that’s suing you, you’re negotiating with another one to keep it from suing you.

And you’re beginning the process of repairing your credit from ALL of them.

If that makes sense to you, then you should consider our Platinum Membership.

Benefits of Platinum Membership

With our Platinum Membership you get three manuals: the Debt Litigation Manual, the Debt Negotiation and Settlement Manual, and the Credit Repair and Restoration Manual.

You also get access to our complete member-only area, so that you can reduce the amount of repetitive paperwork you have to do in taking care of all these problems, and you get access to all our member-only articles and videos on all topics.

And you can be part of all of our teleconferences.

Special Tactics

When you take on debt negotiation, debt litigation and credit repair at the same time, you discover that some of the tools work for more than one thing. For example, if a debt collector is bugging you AND has damaged your credit, you can dispute the collector’s action both through the Credit Reporting Act and the Fair Debt Collection Practices Act. These two acts have different purposes (as laws) and requirements. Verification under the two acts is different, and verification under the Credit Reporting Act is more difficult and rigorous for the debt collector – and the CRA also gives you a way to attack the original creditor as well if it is reporting you.

And you can, of course, you can use any and all the information you get through either the FDCPA and CRA (also called the FCRA, for “Fair Credit Reporting Act”) in litigation if they sue you. And you can use any information you get in a lawsuit they – or you – file, in attacking their responses under the FDCPA or FCRA. In other words, knowing all three sets of rules can sometimes be very, very helpful. Our Platinum Membership opens some of those ways up to you.

Other Benefits

As with each of the Gold Memberships, you will receive special reports and offers. As a Platinum Member, though, you get them all. This includes:

  • The Three Weaknesses Almost All Debt Collectors Have
  • Take Control of Your Life and Debt; and
  • a discount off the prepaid legal program we offer our members.

10,000 Member Drive

As I point out in our materials on Gold Membership, a key strategy in our debt litigation program is to recognize that debt collectors take a “factory” approach. They file huge numbers of cases and work very little on them because most people either default immediately or give up quickly. So they file a hundred cases, work on none of them, get judgments on 98 percent of the cases they get served, and let a few people get away. Our program helps you be among those who get away “through the cracks.”

But what if everybody defended and fought back?

If that happened, the debt collectors would have to change completely, and until they did, pretty much EVERYBODY would get away from them. Our 10,000 member drive is about making that happen. If everybody fought back, it would shut down the debt collectors and push the judges to stop being mere cogs in the debt collection industry’s machine. With that many people fighting back, learning, watching the courts, and pushing back, it would change the nature of the debt industry completely. I think that would be a good thing.

And so I have begun a 10,000 member drive.

How You Purchase

You buy by clicking on “Register” under “About Memberships” in the main menu and choosing the level of membership you want. Platinum membership costs $20 a month with a $120 sign-up fee.


Follow-up 6A to People being Sued for Debt

Yesterday I ended with a promise to talk about something that worries a lot of people. It seems to worry them even more than the possibility of losing, actually. What is that?

The fear of standing up in court and talking.

You would be amazed at how many of our members start out by saying they’d be happy to do anything but go into court and face the other side.

That’s very understandable. You figure the lawyer on the other side knows more than you do, can say things that embarrass you, and that you won’t say what needs to be said when the time comes.

It doesn’t happen like that, though. The process is much more gradual. Generally, you’ll start by answering the petition. That’s really easy – you just write down your response to each paragraph of the petition against you. In fact, it usually looks something like this:

  1. Admit my name is John Smith.
  2. Deny ever owing money to Debt Collector.
  3. Deny failing to pay any money owed to Debt Collector.


Wherefore, defendant requests this Court dismiss the petition with prejudice.

That will take you ten minutes to write – you don’t even have to type it in most courts. But to get to this point, you will have read some of our materials about debt collectors and the collection process. You’ll learn a little about what they’re suing you for and what law they’re trying to use.

You’ll start the learning process, in other words.

Then you’ll create some “discovery,” which is questions you ask them to answer. Not just any questions, though – questions designed to get the most information that matters from them. It’s kind of an art, but we have materials you can use as a guide, and you can find out much, much more at the teleconferences. By the time you have written the discovery, you will know much more about your case – and it will still be easy. This isn’t rocket science.

But it is a learning process. And as you work your way through the discovery and talk to us at teleconferences about it you’re actually learning a very important skill: HOW to talk about this stuff. After a few teleconferences, if you’re like most of our members, you’ve gotten used to the idea, and in reality you could talk about this stuff with anybody.

Fortunately (or un, as the case may be), the debt collectors do not seem to be able to respond to discovery without trying to stonewall you. That’s actually lucky, because you’re going to see – it will be very obvious – how dumb many of their objections are, how repetitive, and just how made-up they are. And then you’re going to call them and negotiate with their lawyer to send you the stuff. Now you’re doing two very important things: you’re making them spend expensive lawyer-time talking to you, and you’re learning how to talk about this stuff with someone who isn’t cooperative. It isn’t hard at all, as you will see – and you’re also learning the materials better as well as developing your case.

In many cases, that’s as far as it goes. They drop the case. But if they don’t, you will continue with the process, eventually talking to the judge.

And you’re going to find out that the judge may not know the law on this stuff as well as you do by now. You’ll have an agenda, you’ll have things to say, and the fact that it’s a judge no longer scares you. If it goes to trial, it will feel like almost any other argument you’ve ever had where you felt right.

And that’s really the way it’s probably going to go for you.

Sometimes the lawyer is smarter than you, often times not, but it doesn’t matter. The lawyer is just doing a job, and by this time so are you – it’s just that you will be much better prepared than the lawyer, and you’ll have what you need, while he probably won’t. The judge will be a little patronizing at first, but she will see what you’re doing soon enough.

No member has ever told me that he or she felt unprepared for court, and almost all of them have reported feeling quite comfortable. Most, it seems, have been congratulated on a job well done by the judge afterwards.

This is not an exaggeration – it really is this way. “But why?” You may wonder.

Remember that I said 97 percent of these cases either default or give up. That means neither the lawyer nor the judge expects much from you. It can take a while for it to sink in that something different is happening, but they will actually appreciate what you’re doing. Even the lawyer for the other side will, although he probably won’t tell you so. It’s refreshing and nice to see someone stand up for herself, and interesting when that person knows what she’s doing. Plus, and this is also quite important: the law is on your side. They really don’t have what they need to win. That means YOU should win.

The debt collector lawyer isn’t going to hate you for beating him, not that it would matter – it’s just a day’s work for him. I could tell you funny things about judges, too, but for now just take my word for it – most of them are all right, and they’ll be all right with you defending yourself.

The experience is so amazingly different than what most people come into the program expecting that it changes the way you look at lawyers and the law forever. Or so many members have told me. Of course they’re trying to get your money, and it’s serious stuff in one way. You have to do your work. But if you do – and we’ll do our best to make sure you do – you’ll probably be glad you went through it all.

And winning is oh so sweet. You can say good bye to a debt that’s probably been worrying you for quite some time. And by winning you’re more than halfway to getting the thing removed from your credit report.

Follow-up 4A to People being Sued for Debt

Yesterday I told you something that might have struck you as odd. I said that being sued by the debt collector could be the fastest way to get rid of the debt, and that it was ironic that so many people gave up.

Now, let’s keep something straight. I’m not saying that being sued is a good thing, that it doesn’t have some risks or that it doesn’t “waste” a lot of time. Law suits are scary and risky, and you’re much better off if they never happen in most ways.

But even though that is all true, it is also true that if you fight intelligently you have an extremely good chance of winning against a debt buyer. And winning such a lawsuit is the fastest way by far of getting the debt out of your life completely. Not just the debt itself, but much of the damage to your credit.

How can this be so?

Consider what happens when debt collectors bug you. Somebody very low on the totem pole calls you up and demands money. If you’ve ever tried to negotiate, seriously, with these people, then you know they simply don’t have any authority to do anything for you. It costs the company ten bucks an hour to talk to you, so there’s little incentive to move things along – other than by getting you to pay, right?

If you persist, you’ll slowly move up the totem pole, but you’ll never get to anyone who’s being paid much. And that means that they rarely have incentive to move things along. They know there’s a good chance you’ll get tired before they do.

It is possible you’ll get someone who will agree that the best thing to do would be to accept a low payment, and this usually happens, if at all, when you convince them that you really don’t have anything to collect. Try getting them to clear your credit record then.

I’m not saying it cannot possibly be done. Just that it rarely is. You have to convince them that you can’t afford to pay, and then you have to try to get them to help you fix your credit. Why would they do that?

It works differently when you’re being sued.

At first, you’ll have a hard time reaching the lawyer – they have layers designed to prevent that because lawyers get paid a lot. But as you work your way through the case, the lawyer finds that he HAS to get involved. So now, instead of talking to a ten buck an hour employee, you’re talking to someone who really wants to be paid at least $150.

And as you work your way through the case, you’re requiring this $150/hour guy to put more and more time into the case. He’s paid to think, and he’s going to think you’re a wrench in his machine – his money-making machine.

And that’s just what you will be.

Here’s the thing to remember. Debt lawyers never worry about losing a case. They don’t think you can make them lose, and it doesn’t cost them anything to lose either. All they want is as much money as they can get, and so what they worry about is having to spend time and money on your case. It makes sense.

Look at it this way – if you could file 99 lawsuits and get $500,000 of judgments in a few hours, what would you do if the 100th suit looked like it was going to take ten hours? Or twenty? Mostly, you’d look for a way to drop that 100th suit and look for another 99 like the first bunch, wouldn’t you? Well, there are complications, but that’s really what most debt lawyers do.

That can’t make it too easy – or most of them think they can’t. Now, there are some debt collectors who go away if you require verification the first time they contact you, but a lot don’t. And there are some debt collectors who drop a suit if you file an answer or serve discovery on them, or whatever.  But you never really know (ahead of time) where their line is going to be. Is an answer enough? Discovery? Filing a motion? Beating a motion (that they file)?

You never know.

What you can know is that if you keep doing the right things, the cost of the suit to the debt collector keeps going up. Eventually, the chances are they’ll drop it.

But I’ll tell you something important about that tomorrow.

Regards and stay hopeful,


Follow-up 3A to People being Sued for Debt

Yesterday we were talking about the factory approach so typical of most debt collectors. We talked about how a few lawyers could gather hundreds of thousands of dollars’ worth of judgments in an hour or two. And we said that what made that work was that people give up and let them have those judgments one way or another.

Why do people being sued do that?

I’ve talked to a lot of people in this situation and know very well the mix of guilt and helplessness most people being sued feel. But it goes much deeper, as the debt collectors know very well. It starts when the debts start slipping out of control.

Let’s say you had a credit line that was perfectly appropriate, but then something happened to make it harder to keep up. At first you do keep up, then you start making minimum payments, and that is NOT keeping up – you’re losing ground, and you know it. It gets harder to pay close attention to the bill because every time you do you get reminded that you aren’t keeping up.  And of course there is a ridiculous amount of interest to pay.

If you miss a payment, it gets much, much worse. Suddenly you have late-payment penalties on top of horrible interest. It’s all you can do to look at the bottom line, decide what, if anything, you can pay, and put it away for another month.

If that happens a few times you stop looking at the bill at all and just shove it into a drawer for “later.” Or you just throw it away. I mean, you can’t do anything about it, so why rub your nose in it, right?

Something like this happens an amazing amount of the time, and before long you have no idea how much you really owe, or how much you borrowed. You may keep a general running tab in your mind of the total, but who could say how much was interest, penalties, or principle? That stops mattering because there’s nothing you can do about it anyway.

Then the debt collectors start calling. They don’t want to talk about how the debt piled up, and they don’t want to argue about fees. They want to know how much you can pay and by when.

Before long, all you know is that you owe some money, probably a lot, and if they sell the debt to someone else, you may just figure you probably owe it to the person calling you.

When that happens and then you get sued, a lot of people just think it’s easier to “go with the flow.” They know they owe some money and figure it’s to the person suing them. They figure the company suing them has what it needs to win and knows what it’s doing. So they give up one way or another – this is the day they’ve been expecting for a long time.

It’s ironic, because in reality this could be the easiest way to eliminate the debt altogether.

Tomorrow I’ll tell you why.

Follow-up 2A to People Being Sued

Yesterday I was telling you about Frank, Shirley and Kelly, and I could have told you about dozens, possibly hundreds, more. Their stories are typical of people being sued by debt collectors, and they’re typical of the people who choose to stand up and fight.

You may have noticed I didn’t say anything about whether Frank, Shirley or Kelly actually owed any money.

Actually, they probably did. There was some question in my mind about Kelly’s suits, and in all of them there was certainly a question about how much was owed, or to whom. But did they owe the money to someone? I’m almost sure they did. That is the situation faced by a majority of people being sued by debt collectors, and it doesn’t matter.

Law suits are a question of evidence, as I will discuss a little later – the debt collectors have to prove you owe the money if you fight, and they usually can’t.

On the other side of that, I know of plenty of people who have told me they didn’t owe anybody any money, but they didn’t fight. In those cases, the debt collectors got their judgments. A lawsuit is a contest. It isn’t about what is true – it’s about what you can prove (or not). Beating the debt collector is first about answering and then making them prove their case. It takes more than that, though, because they do have tricks up their sleeves.

So let’s talk briefly today about the debt industry and their tricks. We’ll follow up on this tomorrow with how it plays out in court – and what you can do about it.

The Debt Industry

American debt – and particularly consumer debt – has run completely rampant over the past twenty years. Americans now owe over a trillion dollars in consumer debt (mostly credit card debt), and much of that is “stressed.” Auto loans are another trillion, much of it “stressed.” That is, the people owing are walking on a tight line, and if anything happens, they could get knocked off it. And stuff does happen. You know it does. After a couple of late payments, loans are considered stressed, and it doesn’t take much more for people to stop being able to pay at all.

It’s actually impossible to get definite numbers, but it looks like at least a million lawsuits get filed per year based on consumer debt. It may be far more than that. When I was practicing law almost ten years ago, it was not unusual for over a hundred cases to come up in a single day in a single court room. And on one day there were over 700 cases on the docket. On a single day! In a single court room! In one county – in Missouri, hardly the biggest or most daring state of the Union.

In other words, when we talk about debt collection, we are talking about a truly gigantic machine. And I don’t need to tell you that most of the people getting “processed” by that machine are not Rockefellers. No, they’re normal, regular people, who in many cases were lured into unsustainable debt – and in almost all the cases certainly never wanted not to pay what they owed. But stuff happens.


Consumer debt is “transferrable.” That means that if you owe me $100, I can sell the right to collect that money to someone else. Don’t fall for the people who say that isn’t true – I’ve seen some of their videos on Youtube, and they’ll get you in trouble. A whole lot of debt gets sold in the U.S.

What happens is that big creditors – and this is mostly the banks that issue credit cards – sell debt that is in default (“bad” debt) to companies that specialize in collecting it. These companies are pretty big, and they end up with a whole lot of “claims” they are trying to collect. That all make sense to you?

And so on those days I mentioned where there are a hundred – or several hundred – lawsuits in court on a single day, there might be only a few debt collectors, and a few lawyers representing them, there at the time.

How can they do all this? Only one way. For the process to work, almost everybody being sued has to give up!

Most of them do it by not showing up at all (defaulting), but plenty of them do it by showing up to sign “whatever” it takes to delay the problem for a while (“give-up settlements”). Not two in a hundred actually fight – and probably not even one.

That means a single lawyer could “process” several hundred thousand dollars’ worth of judgments in an hour or two. Not bad work if you can get it! – If you’re a lawyer who doesn’t mind doing that to people.

If you’ve watched some of my videos, you may have seen me talk about debt law being “factory” law, and that’s what I mean. One lawyer handling a hundred cases in an hour – that’s assembly line work. So what does that mean to you? And how can it be helpful to know?

Factory Work

Whether you are being sued by a debt buyer or original creditor, you are being sued by a company that has a certain, routine way of doing what they do. They follow this routine because (1) they have so many cases; and (2) they need to keep their expenses to a minimum; and (3) it usually doesn’t matter what they have or do because most people will automatically give up once the lawsuit is filed.

In that scenario, spending any money on building their case is a waste of money, and debt collectors don’t like to do that. So they don’t.

Please understand: I’m not saying debt collectors are dumb or lazy. Economics drives their decision to do almost nothing to prepare their cases. And it is these same economics that give us such a good chance of winning. Your key to defending yourself and what you have is to take intelligent action. If you can do that, you can turn the tables on them completely.

Sounds so simple, right? We’ll show you why it’s true tomorrow.