We were retained by a client that discovered a 2007 default judgment from
Capital One Bank, a common predatory lender who were represented by Forster
and Garbus, a debt collection law firm after receiving notice that his
wages were going to be garnished. Capital One is an original creditor
which makes it more difficult to defend against most of the time. We cannot
use standing and privity defenses against Capital One most of the time
unless they buy the debt from another bank. Simply put, debt buyers like
Portfolio Recovery Associates or LVNV Funding buy debt for pennies on
the dollar from original creditors like Capital One and Citibank. However,
because they buy the debt in bulk, they often do not acquire the debt
in the proper fashion. The assignment paperwork which consists of the
chain-of-title is often forgotten or improper. An actual employee of the
debt buyer is often not available to testify to the fact that the debt
was actually sold and acquired property. These are valid defenses in having
these types of debts dismissed.
Unlike debt buyers, original creditors do not have to prove that they properly
bought or sold the debt because they gave the loan to begin with. The
client in this case informed us that he never received any court documents
and was never served which is common due to sewer-service in New York.
After we researched the address used to allegedly serve him with the court
documents, we uncovered that the address used was one that he had been
evicted from years prior to the commencement of the Capital One action.
We were able to provide proof of the eviction, and Forster and Garbus
agreed to vacate the judgment and settle the matter so as to avoid any
potential action against them.