Sued By A Junk Debt Collector

QUESTION: Sued by a junk debt collector for $1500 on unsecured CC debt from 2011.  This clearly seems to be an attempt to get a default judgment by an attorney who expects that I will not answer. I’ll pay $250 to any licensed TX attorney who will answer on my behalf in the expectation that the junk debt collector will abandon hope due to the presence of an attorney and the weak claim. I seem to be one of many thousands of people who received court docs today judging by the quality of the summons. I’ve been doing research and this seems very easy to defeat. I’m wondering whether or not I should even bother to research how to defeat this when there might be an attorney willing to accept $250 to do it for me.

Last payment on the card was March 19th, 2011. I was served by someone in a $200 car on March 26th, 2015. The lawyer lives 300 miles away. The summons is very sketchy looking.

ANSWER: I don’t know who sued you and who their lawyers are. The debt buyer industry has been empowered over the last 2-3 years for a whole host of reasons. Yes, they may simply be interested in obtaining a default judgment. On the other hand, I have had many debt buyers – the likes of Midland Funding, Portfolio Recovery Associates, and many others up put a fight, even for very low balances. Their attorneys are in court with huge dockets all set for the same day: it is unlikely they would be coming to court for your case only. Plus, if this is a lawsuit in the Justice of the Peace court system, then the Texas Rules of Civil Procedure are severely relaxed, making it much easier to obtain a judgment.

You seem to be a terrific negotiator, considering your online bidding efforts here. Any lawyer that makes an appearance for you in an answer is on the hook for the entire case, not just the answer. An attorney who values their law license and their reputation will not get hired for the limited purpose of filing an answer and then asking the court to withdraw from your case. (I may be wrong, of course.)

If you fail to answer the lawsuit, or if you appear – pro se or through an attorney – and lose the case, the judgment will likely be significantly higher than $1,500.00, including interest, fees, court costs and attorney fees. The damage to your credit report, as well as the risk of post-judgment collection would be reasons for you to hire an experienced attorney.


Getting Sued By A Pay Day Lender

QUESTION: I have multiple online payday loans out since 2012 can they sue me?

I tried to work out arrangements with them but they wouldn’t settle what I could afford and refuse to give me an address to mail payments to them can I be in legal trouble?

ANSWER:  Theoretically, they can sue you. Generally, however, the payday loan collection industry is notorious for its illegal debt collection tactics. I recommend you consult with a consumer rights attorney, not just to review the terms of the payday loans, but also to determine if your rights have been violated (as well as your credit reporting rights.) 

Many consumer rights attorneys do not charge their clients up front, because many of the consumer rights statutes allow them to collect fees from the bad guys.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

Responsibility For Estate Debts

QUESTION: What is my legal responsibility to pay remaining debts for my deceased ex father-in-law if he named me beneficiary on 401k?

He lived in Illinois and I live in Texas. He apparently owed money to a bank in Illinois and they want me to turn over any monies received to them.

ANSWER: Please be careful about paying deceased people’s debt. There are a lot of abusive debt collectors taking advantage of the fact someone has died as justification to squeeze money out of the heirs, estate executors, etc. If Illinois law is similar to Texas law, you might want to consult with a consumer rights attorney about illegal debt collection tactics. Most consumer rights attorneys will handle cases against abusive debt collectors without charging for their time up front.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

Using A Credit Card Without Prior Authorization

QUESTION: Can your spouse give you a credit card to use without you signing your signature or authorizing any paperwork you haven’t seen?

Anyone can give you a credit card to use, if they authorized your use with the credit card company. You should find out whether your social security number was used in obtaining the credit card account. If any credit card was taken out (even by your spouse!) without your knowledge, you should dispute it, close it, and ultimately you might need to file a police report for forgery/fraudulent use of your private information. 

The other issue to keep in mind: your spouse may have legally taken the card out using their social security information only. They may be kind enough to give you the card to use at your leisure or discretion. If, however, there is a debt that is built up and your spouse defaults, you might also be sued for the full balance: not just your purchases, but your spouse’s purchases too. The reason for that obligation has to do with Marriage and Community Property laws in the State of Texas. 

I have handled cases in the past where one spouse did not know that the other spouse was running up a debt. Any expenses that are used to benefit the household are joint obligations of both the husband and the wife. If, on the other hand, your spouse is taking vacations alone, you would not necessarily be obligated on that amount of debt. 

You should seek the advice of a family lawyer if your intention is to maintain your marriage as “separate property” as opposed to the usual “community property” which is the default marriage and finance situation in Texas. You should also seek the advice of a consumer lawyer if the account was taken out without your knowledge and it is negatively effecting your credit reports/score.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

Debt Collection Tactics

Debt collectors are notorious for engaging in what can often be described as abusive and harassing tactics in order to collect a debt. Some debt collectors will even go as far as threatening to come to your home or place of employment to serve you with lawsuit papers. In my experience, these particular debt collectors are the worst of the worst, and most often they usually are not even licensed to collect debt in Texas.

If, however, the party that was calling happens to be a legitimate debt collection agency, then one would probably be within their rights to sue them for violations of the federal and Texas debt collection laws. My office has handled many suits against abusive debt collectors. The laws allow the consumer to recover damages, in addition to all of the attorney fees and costs incurred while suing the debt collector. Many consumer rights lawyers will handle debt collection abuse cases on a contingency basis.

Before proceeding with a lawsuit, it is advisable pull your credit report to determine if the particular collection agency in question is listed. Depending on when the account in question went into default, it may or may not appear as a negative comment on your credit report. A free copy of your credit report can be downloaded once every year from Any suspicious lines listed on your credit reports should also be taken up with a consumer rights attorney.

Finally, if you have the name and/or phone number of the collection agency, and especially if you have any recordings, feel free to send that information along. My office will gladly do some research to determine if the collection agency is legitimate.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

QUESTION: You Were Given A Credit Card With Only Your Name On It, Can Your Spouse Also Use It?

There are issues here that also touch upon family law and community property which essentially mean that expenses and debt incurred for the family and the household are owed by both spouses. There are ways to avoid community property, for which I would suggest first consulting with a family law attorney before taking such action. If one’s spouse made charges solely for their personal benefit, the other spouse, for whom the card is officially in their name, might not be obligated to share that burden under a theory of community property. But that spouse would be obligated if they had authorized their spouse to use the card.

The other, and perhaps bigger issue relates to consumer rights and unauthorized use of the credit card. If one spouse takes out a card in the name of the other spouse without their knowledge – even if it was done by the other spouse – an option might be to consider closing the account. Being married and living in a community property state does mean that one must open them self and their credit worthiness up to fraud. In fact, a significant amount of identity theft occurs within families. A suggestion might be to contact the credit card company to find out: who opened the account, why it was opened in one’s name without prior authorization, and whether some of the charges can still be disputed.

I would also strongly recommend pulling a free copy of your credit reports through to find out if there are other accounts in your name that you are not aware of. Finally, it is advisable to consider consulting with a consumer rights attorney.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

I am being sued, should I hire an attorney? What if I cannot afford an attorney?

To be short and to the point, YES- you should hire an attorney. One local debt collection attorney noted to our staff that he does not mind dismissing the cases where an attorney steps in to represent a consumer as these cases only account for about 10% of his case load. Meaning, he does not mind dismissing 10% of his cases due to representation seeing as he is still getting judgments granted in his favor on the other 90%. This could be seen as a general business model for most debt collection law firms. It makes no sense for them to use their time and resources on contested cases if they can be more efficient on those that are uncontested.

You can find a consumer attorney in your area by visiting

If you cannot afford to pay a private consumer attorney and you believe your income is low enough for you to be considered “impoverished” by the Federal Poverty Guidelines, you can apply at your local legal aid or other non-profit legal services center for help.

This blog covers consumer rights as they relate to Texas State law. If you reside outside of the State of Texas, you should consult with a local attorney.

CRIMINAL Debt Collectors calling Consumers Common Criminals

On Friday, March 23, 2012, Channel 2 in Houston aired a special on abusive debt collectors. Reporter Amy Davis, paired with Consumer Attorney Dana Karni, brought to light the “Dark Side” of the financial industry. Needless to say, those who work on the “Dark Side,” have proven to have a lot of nerve, too little regard for Federal Law and use language trickery, saying what it takes to get consumers to agree to almost anything. Consumers spit out their bank account information and credit card numbers because they feel threatened and stressed by these collectors. These are “scare tactics,” like we’ve mentioned before, at their best.

Common Threats:
– You’re going to lose your job.
– You’re going to go to Jail.
– We’re filing criminal charges against you.
– You’re driver’s license will be revoked.
– We’re going to put a lien on your home.

Common Misrepresentations
We’re calling from:
– the Sheriff’s Department,
– the F.B.I.,and
– the I.R.S.

Here comes the IRONY…
While these collectors are threatening criminal prosecution and even jail time (among other things), chances are they are facing criminal charges themselves or just finished dealing with the consequences of criminal acts from their past. As it is not required by Texas state law, most potential collectors are not subject to a criminal background check when applying for this type of work. With that being said, the possibility that the person handling your account and calling you a criminal is a criminal, is fairly high.

REMEMBER, the Federal Fair Debt Collection Practices Act prohibits 3rd Party Debt Collectors from using harassment or misrepresentations in order to persuade you to pay a debt.

If this has happened to you, contact the nearest consumer attorney to you and find out your rights. You can find an attorney in your area at

To watch the Channel 2 Special that inspired this post, please go to

This blog covers consumer rights as they relate to Texas State law. If you reside outside of the State of Texas, you should consult with a local attorney.

About the Debt Collection Rights Blog

These days, it seems that many consumers fall into one of two categories: either they have no idea that they are protected by some federal or state rights or they turn to the internet for self-education, oftentimes absorbing incorrect information.  The Debt Collection Rights Blog is intended to provide information for consumers regarding debt collection and other consumer rights.  This blog is not intended to provide legal advice, nor to create and attorney-client relationship for any of its readers.   Consumers whose rights have been violated should consult with an attorney.  For a nationwide list of consumer lawyers, visit the National Association of Consumer Advocates online at