Getting served with a lawsuit is never a pleasant experience. After the Sheriff has handed you the papers, or (in some cases) you’ve opened your mail, what should you do? After you are done crying, screaming and yelling, I’ll start by giving you some good news.
What Can’t Happen in a Civil Lawsuit
Debtors’ prisons were abolished back in the 19th Century. You can’t go to jail based on a civil lawsuit (except in some rare situations: if you ignore a court order, such as one requiring you to appear for a deposition, you could be held in contempt of court). In Pennsylvania, debtors also are protected from wage garnishment, with a few exceptions (support, student loans, taxes, restitution orders in criminal cases, and back rent on a residential lease).
This doesn’t mean that you can totally ignore a lawsuit. If the creditor gets a judgment, they may be able to levy (take) property, including money in a bank account, or put a lien on your real estate.
What Can Be Done About a Collection Lawsuit
In a collection cases, your choices include: defending the lawsuit (they have to prove that they have the right to collect, that you owe it, and the amount they claim is correct); settling it (either by making payments, or by offering them a lump sum), or filing a bankruptcy petition. There are some circumstances where you don’t need to do anything – if you are truly “judgment proof.”
You need to sit down with an attorney, to determine your best option. This conversation should include a discussion about the merits of this particular lawsuit, and your overall financial situation.