In these current economic times, creditors often do not sue debtors themselves if the account goes into default. More and more often they will sell it to a debt buyer (or "factor") at a discount and let them worry about collecting.

Outfits like New Century Financial, Midland Funding, LVNV Funding, or Cavalry Portfolio do this all the time. The problem is, even though the factor bought the debt, they aren't actually the creditor, and this can cause problems under the court rules of evidence.

Credit card applications, contracts, billing statements, and the like, which are necessary to prove the case, have to be verified as genuine and accurate business documents before the court in order to be accepted. This has to be done by a person with "personal knowledge" as to those facts. But this is only necessary when you dispute the lawsuit.

Many times, however, the factor will not produce a witness at trial, either because they are out of state, the balance is too small to warrant it, or for any number of reasons.  No witness, no case!

Even if they do produce a witness, that person will probably not have the requisite personal knowledge to testify as to the facts necessary to prove their case or lay a proper foundation for the documents necessary to get into evidence (i.e. seen by the judge). This would be fatal for the factor.

If you live in southern New Jersey and are being sued by a debt buyer (or just don't recognize the name of the creditor bringing suit), and want a lawyer to represent you to fight it, please feel free to call me at 856-432-4113 or contact me through this site to schedule an appointment in my Woodbury office to discuss your case. I have represented creditors for many years and am familiar with the collection industry and how it ticks. Put my experience to work for you!

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Steven J. Richardson
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Bankruptcy, Collections, Student Loan, DUI and Traffic Court attorney in Woodbury, NJ.