I bought a car in SC, which was repossessed in 2007. Now a third party debvt collector is trying to collect over $6000.00 from my mom in Indiana (she doen't recal signing any papers to co-sign the loan)? What can we do? Does she have to pay?
Country relating to Question: United States
State (if USA): Indiana
Mom asked for particulars on the debt and was told what vehicle, the original credit lender, and the debt total. They are threatening to sue her.
Thank you for your question.This may be an attempt to collect the debt from your mother even though she is not legally obligated to pay it. She should not pay the debt without proper verification that she is obligated to do so.A lender can collect a deficiency on a vehicle repossessed in which the Loan balance exceeds the sale price of the car. However, your mother cannot be held liable for the deficiency if she did not co-sign on the loan. This would be the number one defense, and she may consider asking the debt collector to produce the document in which she apparently co-signed.If she did co-sign, there are a number of defenses to these types of cases. If your mother did not receive the proper notice of the repossession, that would be a defense. If the vehicle was not sold in a commercially reasonable manner (such as the sale price was well below the fair market value), that would be a defense as well.Depending on the amount claimed and whether the debt collector does in fact file suit, it may benefit your mother to hire an attorney to make these defenses for her to ensure dismissal of the lawsuit. The collection may be beyond the Statute of Limitations as well, depending where the suit is filed and other particulars of the case.Here is some information on dealing with debt collectors and consumer's rights under the federal Fair Debt Collection Practices Act (FDCPA), which would apply here:http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre18.shtm
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What can we do now to avoid the lawsuit?
There is nothing really you can do to prevent the debt collector from filing a lawsuit. However, your mother may wish to contact the debt collector and ask for verification that she is liable for the debt. If the debt collector files a lawsuit knowing or having reason to know that your mother is not liable for the debt, and the lawsuit is dismissed, she may be able to sue for frivolous Litigation and/or violation of the FDCPA. If the debt collector realizes that your mother will not easily lie down and pay a debt that she is not liable for, it may back off.
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