KevinW

New here and being sued by Cavalry SVP

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Hello, 

I'm being sued by Cavalry SPV for a CC account they they bought from Citibank.

I called the office of the lawyer that filed the lawsuit.  She asked me if I wanted to make a payment. I said I don't have that kind of money. She then told me to send in a letter with an offer of what I could pay, and she would forward it to her client (Cavalry) to see if they would accept.

The summons has an exhibit, which I presume is their evidence. It has the exact same documents that are in this post. Same format and everything. 

So my quest here is to find out what options I have.

1. Is there anything in the documentation that could be construed as a weakness in  Cavalry's claim?

2. Should I make them an offer to settle for less than the amount they say is due?

3. If the answer to #1 is yes, then would I be better off going to a lawyer?

I hope that someone can offer some solid pointers. 

Thanks.

 

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You really want to get this out of court by having the judge order the parties into "private contractual arbitration".  Citibank still has arbitration clauses in their agreements, so you should have no problem there, and the most recent one says they cannot recover their arbitration fees from you if they win.  So that means Cavalry would sooner walk away from this debt than follow you into arbitration.  The only hitch is if the debt is over $10,000, Cavalry may follow you into arbitration.

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Your options are:

1) Fight it in court.  Since they already provided the bill of sale, the most common method by which to fight JDB suits won't work for you.  This will probably not end well, especially in GA.

2) Private, Contractual Arbitration.  Look up your credit card contract and check the arbitration provision.  JAMS is best, but AAA will do.  Collectors can't recover their fees in arbitration, which are considerable.  Even if they have you dead to rights on the evidence, they often won't follow you into arbitration simply because it's not economical.

3) Offer/accept a settlement offer.  You're not in a great position to settle right now, since they're suing and you haven't done anything to telegraph that this is going to be an expensive fight for them.  Yes, if you offer to settle you should always offer to settle for less than the amount they want.  Otherwise it's really just you paying your bill and isn't really a 'settlement' at all.

As Harry said, arbitration is almost certainly your best bet, especially in a creditor friendly state like GA.  Even if a settlement is your goal, you'll get a better offer by pushing it into arbitration first and depending on the amount they may not even follow you.

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Thanks, guys for your replies.

@Harry Seaward The debt is about $1200.00

I'm confused about the arbitration bit. The debt was sold to Cavalry by Citibank, so I'm presuming that the account is off their books and out of their hands, isn't it? 

Or are you saying that the terms of the original contract/application apply to Cavalry as well since they bought the account?

@hades01 I have no idea where the original contract is anymore. Probably shredded years ago.  Does that mean I can't ask for arbitration?

I'm confused as to how I would go about asking for arbitration.  Do I go to the courthouse to provide an answer to the summons and ask there?

 

 

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> Or are you saying that the terms of the original contract/application apply to Cavalry as well since they bought the account?

That is correct.

You can find the relevant contract here:  https://www.consumerfinance.gov/credit-cards/agreements/

You're going to want the most recent contract dated before your default.  So if the last payment was made May 2013, you'll want a contract from April 2013 or earlier.  Use your annual free credit report find out if you don't remember.

There's the 'master thread' about all things arbitration.  You're going to have to do some reading here.  Also check with your local legal aid organization, and use them to doublecheck your paperwork before filing to make sure it conforms to local rules.  Pay attention to how long you have to file your answer (it'll say this in the summons you were served with).

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@hades01 Thank you. Lots of reading to do. 

Just a couple more questions if you don't mind. 

Say I'm able to get the judge to push this into arbitration. The best case scenario would be that Cavalry declines to follow me into arbitration.  What happens after this, as far as the debt is concerned? Will they then sell it to someone else?

If they do decide to accept and enter into arbitration, am I then allowed to ask or offer to the arbitrator to settle?

 

 

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It depends on the disposition of the court case, whether it's dismissed with or without prejudice, and whatever agreement you can come to with them (if any).  A dismissal with prejudice is ideal, meaning they can never sue again for that debt.  Even if it's dismissed without prejudice it's unlikely they'll sue you again, since they'll know what you're going to do.  As long as you don't do anything to refresh the statute of limitations, once that expires that's the end of it as far as legal means of recovery are concerned.  Then 7.5 years after your default, assuming you couldn't get them to remove the tradeline from your credit report as part of an agreement, it'll disappear from your credit report and that's the end.

As for whether or not it'll be resold, it's hard to say.  For one thing, a lot of these debts are never actually sold in the first place, but merely 'assigned' to a collection agency.

You can offer or be offered a settlement at any time, even if you take it to court or arbitration and completely lose.  A judgement is just a tool to collect money; depending on where you are and what kind of income you have it can be difficult or impossible to garnish wages.  If you don't keep any money in a bank account they can't get that either.  If you have nothing titled in your name, they can't put a lien on anything.  So a judgement isn't a guaranteed thing, and even if you do have something they can go after, that's still more work on their part.

You wouldn't ask the arbitrator to settle; a settlement is a bilateral agreement between you and your creditor.

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19 minutes ago, hades01 said:

As for whether or not it'll be resold, it's hard to say.  For one thing, a lot of these debts are never actually sold in the first place, but merely 'assigned' to a collection agency.

Debt buyers such as Midland, Cavalry, Portfolio Recovery, etc. are referred to as "assignees", but they have purchased the debts and are collecting for themselves.

A collection agency that is assigned to collect for an original creditor is only collecting for that creditor and usually won't sue.  In fact, unless state law allows they can't sue. 

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