A Shady Side of Debt Collections in Washington State

What if there was a shady side of the law that allowed federal bankruptcy court trustees to hide things from you for up to a year before you found out you lost your assets to your creditors after filing for bankruptcy protection? What kind of protection would that be for debtors?

No one would like that I don’t think, but in the state of Washington, a current debt collection rule of procedure heavily favors the debt collectors who are in the process of using the courts to prove their claims against debtors. This rule of procedure can have the affect of allowing the debt collectors to hide the fact they have a judgment against you for over a year before they make attempts to collect.

Having a court judgment against a creditor for over a year in Washington is important because of two reasons. First of all, it is more difficult to undue a judgment more than a year after the judgment was issued, and it is advantageous to allow the minimum interest on judgments to accrue for the year. This matured judgment makes it easier to attach liens and seize accounts.

What is so special about Washington’s legal collection procedures that makes this shady side of collections work?

The one advantage debt collectors have over debtors is legal collections, and when debtors fail to respond to lawsuits, a judgment is normally always rendered in favor of the debt collectors. A judgment in the hands of a debt collector is the legal means they need to attach liens or seize debtor’s assets. Both is the backbone for making money in the collections industry. Once a lawsuit judgment has been entered by the court in favor of the collection agency, it is just a matter of time before they collect the debt plus interest and sometimes, legal fees.

There is nothing shady about going through courts to legally collect a debt, but there is something shady about the process when the debtor is not aware a judgment has been issued against them, and that often happens in the state of Washington.

In Washington, debt collectors are allowed to serve the debtor with the Summons and Complaint of a lawsuit before filing with the court. This means the summons and complaint will not have a case number when the debtor receives it. The debtor may call the court to confirm the lawsuit, but the court will not have recorded that the lawsuit exists and will answer accordingly. Many debtors might mistakenly think that no response is required to the summons and complaint because they do not understand in Washington a lawsuit does not have to have a filing number to begin the legal process.

As a result, the debt collectors need only wait 20 days without a response from the debtor and then file the lawsuit. Since the summons and complaint is the debtor’s legal notice of any legal actions, the debtor may never hear from the court again. The debt collectors will lay in waiting for a year, and the debtor’s worse nightmare then begins.

Shady? I believe anytime you hide things in a court of law, it is shady for one side or the other. I think debt collectors must have a lot of money and great lobbying in the state of Washington to get away with that type of advantage. Shame on you Washington! Where is your since of fair play?

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