If you’ve fallen behind on your credit card, loan, or medical bills, you might one day get a notice—not from the original creditor, but from a debt collection agency claiming you owe them money. This can be both confusing and intimidating. But don’t panic. Here’s what you need to know when your debt is sold to a collection agency, and how Diwan Law can help protect your rights.
Why Creditors Sell Your Debt
When a creditor—like a bank or credit card company—fails to collect on a delinquent account for several months, they may decide it’s more cost-effective to sell that debt to a third-party debt buyer. These companies purchase unpaid debts for pennies on the dollar and then attempt to collect the full amount, often with added interest and fees.
Some well-known debt-buying companies include:
- Midland Credit Management (MCM)
- Portfolio Recovery Associates (PRA Group)
- LVNV Funding
- Cavalry Portfolio Services
- Unifund
- Asset Acceptance
- Jefferson Capital Systems
These companies often buy debt in bulk and may not have complete or accurate information about your original account.
What Happens After Your Debt Is Sold
Once your debt is sold, the debt buyer becomes the new owner of your account.
They’ll typically send you a “validation notice” letter explaining the debt and your rights. From this point on, they have the right to pursue collection efforts, including:
- Frequent phone calls or letters
- Reporting the debt to credit bureaus
- Filing a debt collection lawsuit
If you receive a lawsuit from a debt buyer, it’s crucial not to ignore it. Even if you don’t recognize the company or believe the debt is incorrect, failing to respond can result in a default judgment against you, leading to wage garnishment or a bank levy.
Know Your Rights Under the FDCPA
The Fair Debt Collection Practices Act (FDCPA) gives consumers strong protections against abusive collection practices. Under the FDCPA:
- You have the right to request debt validation
- Collectors cannot harass or threaten you
- They must stop contacting you if you send a written request
- They cannot call you at unreasonable hours or discuss your debt with others
Debt buyers frequently rely on missing or incomplete records, making it possible to challenge the debt’s validity in court.
How Diwan Law Can Help You
If you’re being contacted or sued by a company like Midland Credit, Portfolio Recovery Associates, or any other debt buyer, it’s time to talk to a skilled debt defense attorney.
Diwan Law specializes in defending consumers against aggressive debt collection lawsuits. With years of experience challenging major debt buyers in court, we know how to:
- Demand proper documentation and chain of title
- Identify errors and violations under the FDCPA
- Negotiate favorable settlements
- Get cases dismissed when collectors can’t prove ownership
Many debt buyers are hoping you don’t fight back. But with Diwan Law in your corner, you don’t have to face them alone.
Contact Diwan Law Today
Don’t wait until it’s too late. If you’ve been contacted by a debt collector or served with a lawsuit from a company like LVNV Funding or Cavalry Portfolio, get help immediately.
📞 Call Diwan Law now for a free consultation
📍 Serving clients across Georgia
Final Thoughts
Being pursued by a debt collection agency is stressful—but you have rights, and you have options. Whether your debt was sold or you’re facing a lawsuit, Diwan Law can provide the strong legal defense you need to fight back and protect your future.
* The information presented in this article does not constitute legal advice. All information, content, and materials presented on this website are for general informational purposes only. If your business is sued, we encourage you to contact Diwan Law before taking any action.
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If you’re facing a situation that involves a consumer transaction and you feel that the company is taking advantage of you, call Diwan Law. Diwan law represents clients with consumer law issues.