Responding to a Lawsuit Your Creditor Filed Against You

 Posted on July 12, 2024 in Creditor Lawsuits

Receiving notice of a lawsuit from your creditor can be devastating, but understanding your options and taking prompt action is vital. A Texas lawyer can help you with the steps you should take if you are served with a lawsuit, helping you through this challenging situation effectively.

Make Sure You Understand the Lawsuit

When you receive a lawsuit, you will be served with two key documents:

• Citation: This official court document informs you that you are being sued and provides a deadline for your response.

• Petition: This document outlines the creditor’s claims against you and the amount they are seeking.

Read these documents carefully and note the deadline for your response, typically 20 days from the date you were served in Texas.

Steps to Take When Served with a Lawsuit

Do not ignore the lawsuit. Failing to respond can cause a default judgment against you, allowing the creditor to garnish your wages or seize your assets. Gather all relevant financial documents, including account statements, payment records, and correspondence with the creditor.

Be sure you verify the debt’s validity. Ensure the creditor has the right to sue you and that the amount claimed is accurate. You should also consider the following response options:

• File an Answer: This formal response to the court denies or admits the creditor’s claims. It preserves your right to present a defense and prevents a default judgment.

• File a General Denial: In Texas, you can file a general denial that contests all claims made by the creditor, forcing them to prove their case.

• Negotiate a Settlement: You may attempt to negotiate a payment plan or reduced lump sum payment with the creditor.

• Consider Bankruptcy: In some cases, filing for bankruptcy may be the most appropriate option to halt the lawsuit and address your financial situation.

Potential Defenses Against a Credit Lawsuit

When responding to a lawsuit, it is important to consider several potential defenses. In Texas, the statute of limitations for most debts is four years from the date of default, which can be a strong defense if applicable. You may challenge the creditor’s standing, requiring them to prove they have the legal right to sue you for the debt. You can contest this in your response if the creditor has miscalculated the amount owed. In cases where the debt resulted from identity theft, presenting evidence to support your claim can be a valid defense.

If you were not served the lawsuit papers correctly according to Texas law, you may have grounds to contest the lawsuit based on improper service. Remember that each case is unique, and the appropriate response depends on your specific financial situation and the details of the lawsuit. Carefully evaluating these potential defenses can help you formulate a strong response to the credit lawsuit.

Contact a San Antonio, TX Bankruptcy Lawyer

Facing a lawsuit from a creditor is a serious matter that requires prompt and informed action. If you are unsure how to proceed or need assistance in this complex process, seeking help from a Kerrville, TX bankruptcy attorney can be beneficial. Call Law Offices of Chance M. McGhee at 210-342-3400 for a free consultation.