Debt Settlement Directory

Debt Settlement Lawsuits

Only the initial creditor can sue for a defaulted loan. This is except when the collection agency has a lawyer who is acting on behalf of the original creditor. The collection agency may harass you and threaten you, but you won't be sued by them.

A collection agency needs the approval of the original creditor in order to sue. They can't sue at all, legally, and claiming to do so or threatening to do so will violate the FDCL. They have to send the debt back to the original creditor (assuming they'll take it) who then decides whether or not to sue and then either sends it to attorneys or decides to let this process continue.