Sued by Cach LLC: 7 Things That Happen Next

You can ignore the lawsuit or respond to the lawsuit. If you ignore the lawsuit, you could get a judgment against you and have your bank account garnished, salary garnished, or property seized. Ignoring the lawsuit doesn’t make it go away. What happens next is, first of all, the debt collector has to prove it has the right to collect on the debt. Debt collectors often have a hard time proving that.

1. Know who is suing

Start by writing down the name of the collector. The name on the top of the paperwork you received is not always the company you are in debt with originally. When creditors collect on money that they have already tried and failed to collect for some time, they may sell it to a collection agency for pennies on the dollar. CACH LLC is one such buyer and picks up old charged-off accounts, mostly credit card debt. The company used to belong to Square Two Financial of Denver, but that company filed for Chapter 11 bankruptcy in March 2017. Now, CACH accounts are collected by Resurgent Capital Services, the company behind LVNV Funding.

If the debt belonged to another creditor originally, the new creditor, a debt buyer, didn’t create the account and has only gotten limited data files, not the kind of evidence you’d have from the business you did the transaction with. So the proof they have is weaker. It’s a bit easier to fight an anonymous company who acquired your debt than it is to fight the original creditor.

2. The answer clock starts

When you get a notice, the “answer clock” starts ticking. You have a limited time to respond to the lawsuit. The deadline varies from state to state. Your answer to the CACH lawsuit must be sent within the amount of time listed in your paperwork. To respond, you need to file an answer with the court as well as a copy to the plaintiff. In California, you have to file and serve an Answer within 30 days of being served, or the collector can ask for a default. Remember, answering a lawsuit does not mean you agree that you owe them anything.

3. Silence means default

When you fail to answer the lawsuit, the collector assumes you’re no longer disputing the debt. The plaintiff collector will then ask for a default judgment. This is when the court grants them the right to collect whatever amount they requested in the original lawsuit. That may come with collection costs, interest, and attorney fees. Refusing to accept service isn’t likely to stop it. Debt buyers’ suits are mostly won when they’re left unchallenged.

4. A judgment gets enforced

When you have a judgment against you, the collector can proceed with it to collect what it is owed. The collector may garnish your wages or bank account. It may put a lien on your home. What collectors can actually do depends on where you live. For wage garnishment, the federal cap is the lesser of these two figures: 25% of your weekly disposable income or the amount by which your disposable income exceeds 30 times the federal minimum wage. If you make $217.50 a week or less in disposable income, nothing can be garnished.

5. CACH must prove ownership

CACH LLC has to prove that you owe the debt, and that it is the right person to collect it. It also has to prove it owns the debt and that it bought the debt from the original owner. When a debt is repeatedly sold from one collector to another, it’s possible the account information and original records are lost in the process. If a collection agency cannot prove it owns a debt, a court won’t grant a judgment against you in favor of the agency.

The chain of custody on a debt is often murky and confusing. Often, debt-buying companies get spreadsheets, not files, with debts to collect. Bills of sale on debts often don’t name specific accounts. The debt-buyer’s witness usually lacks personal knowledge of your account. You may owe a debt but not owe it to them.

Check the complaint’s attachments. The debt collector is likely to have papers attached to the complaint; check for the Bill of Sale, Assignment of Accounts, Schedule of Accounts, and Affidavit of Sale. In these you may find the case disclaims warranties, or it may fail to name any specific account.

6. Old debt is a defense

Statutes of limitations limit how long a creditor or debt collector has to sue you over an old debt. So once the statute has run, collectors can’t sue you to collect the money, but you still have to respond to court and point it out. In some states, any payment or promise to pay restarts the clock. As of April 2022, the clock for New York state consumer credit debts runs for three years.

Debt buyers like CACH must also follow the FDCPA. It covers debts that come from family needs, personal needs, or household needs. It doesn’t cover purely business debts. You have a year to sue a debt-buying agency that breaks it and may win up to $1,000 even if you can’t prove damages. Your attorney fees and court costs may also be recoverable.

7. A settlement window opens

Settling with CACH before a judgment is entered could get you a deal. Most third-party debt buyers bought their accounts for pennies on the dollar. When their paperwork is challenged, they may often settle.

In summary, if you owe the debt, and the statutes of limitations hasn’t expired, and CACH LLC can prove you owe the debt and owns the debt, you could get a judgement against you. If you don’t ignore the lawsuit, you can respond to the lawsuit and may be able to settle for less than the original debt.

A free contract review costs nothing and takes a day or two. Call (888) 837-7053, or send the agreements to Delancey Street for a straight read on your options.