SALT LAKE CITY — Imagine checking your bank account and finding that your check has been garnished for unknown reasons.
This is a common practice: Utahans are sued by a debt collector in civil court with sometimes no notification.
Erika Rickard, a project director with Pew Charitable Trusts, says debt collectors will often sue consumers to collect their debt.
The problem: defendants may not know that they are being sued until their paychecks are garnished.
“They might mail those court papers. They might bring them to someone’s house. They might be bringing them to the wrong address," said Rickard. "They might be bringing them to a previous address and people might not realize that there is a court case being filed against them at all."
In some cases, someone may receive the documents, but it is not clear that they’re being sued.
“What we’re seeing is a lot of complicated language in court papers and in some instances, the name of the company that’s bringing a lawsuit might not be a company that’s familiar to you,” said Rickard. “It might not be something that sounds like the credit card company that you know you might owe something to because that’s been sold to a new company that you don’t recognize.”
What happens if you miss your day in court?
Collection agencies can obtain a "default judgment", so if the consumer doesn’t participate, the court can issue a judgment in favor of the debt collector without checking to make sure the right person was sued for the right amount.
That judgment opens up wage garnishment, an additional channel for debt collectors to recoup their debt.
The research found that when a defendant attempted to contact the court about their case, they were often left with more questions than answers.
“If you call the court, the court might not even know about the lawsuit yet,” said Rickard. “Something that’s unique in Utah is that the debt collector sends the court papers to the consumer first before filing it in court so, even if you call the courthouse, they might not be aware of the court case.”
After a court judgment is said and done, add the costs of the settlement and possible attorney’s fees: you’re shelling out more than the original debt.
“These court judgments can follow people for years, or even decades, after the court cases are over. Those are the kinds of financial harms that come with that original debt, but the added harms come with a court judgment," she said. "In addition to the additional court costs themselves, that judgment can hang over a consumer for much longer than the court case itself.”
While it’s not always feasible, if you receive a letter and you’re not quite sure of the language or what it is, contact the court anyway.
Even if they don’t know about your specific case yet, they can at least help you interpret what it means.
The study from Pew Charitable Trusts noted that courts should work to implement more phone notifications to increase participation in cases like these and make sure a potential defendant has acknowledged they’ve been served those court documents.