What steps can I take to avoid a lawsuit from a collection agency?

UPDATED: Jul 20, 2012

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What steps can I take to avoid a lawsuit from a collection agency?

I’ve already been sued by one recently and spent nearly a grand to settle it. I don’t have a job and I don’t want to part with any more money. Are there any steps I can take to prevent them from suing me? With the last case, they sent me a letter to disclose assets and I didn’t respond. If I were to respond to that letter explaining my income/asset situation would a debt collector still be likely to sue? And if they did sue me, how could I protect my exempt assets?

Asked on July 20, 2012 under Bankruptcy Law, Massachusetts


S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If the case was settled and there was a settlement agreement and release of claims signed by the parties, then that ended the matter and no lawsuit will be filed.  If there wasn't a settlement and you were to disclose assets in response to the letter, the creditor / collection agency would file a lawsuit to go after your assets.  If there was a settlement, that ended the matter and there is no reason to respond to the letter and disclose assets.  If there was a settlement, the lawsuit should be dismissed with prejudice which means it cannot be reinstated. 

If you are concerned about being sued by other creditors / collection agencies, you might want to consider filing bankruptcy.  Chapter 7 bankruptcy is straight liquidation which eliminates certain types of debts.  In the bankruptcy, there are exemptions which will protect various categories of assets; for example, car, clothing, household goods and furnishings, etc.  These are only a few of the exemption categories.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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