Wells Fargo is a common lender that we mostly see in the collection of credit card and private student loan debt. Wells commonly retains Tenaglia and Hunt, a debt collection law firm to enforce on these debts in both New York and New Jersey. Wells does not sell their debt to third party debt-buyers as often as other original creditors. This means that we often see lawsuits coming directly from Wells Fargo. Usually clients will receive collection calls and letters until ultimately a lawsuit is filed. Lawsuits often turn into default judgments because consumers usually do not receive service of the summons and complaint. This leads to default judgments that then allow Wells and Tenaglia to freeze consumer bank accounts, garnish wages and place liens on real property all while judgment interest continues to accrue on the balance.
It is most important to submit an answer with defenses to protect against a default judgment. This keeps the burden on Wells Fargo and Tenaglia & Hunt to prove that the debt is rightfully theirs and that the amount is correct and appropriate. More importantly, in a situation against an original creditor like Wells it provides the necessary leverage to negotiate a reduced settlement. If a default judgment is obtained then it is crucial to file an order to show cause to vacate that judgment as quickly as possible. That will then stop the enforcement proceedings such as wage garnishment from moving forward. This also provides the necessary leverage to obtain a settlement as otherwise the case reopens from the beginning.
Our experience has shown that Wells Fargo and Tenaglia & Hunt are willing to negotiate favorable settlements in both credit card and private student loan matters as long as leverage is obtained by the consumer as described above. We often see Wells settling matter for 50%-75% off of the entire balance. Wells has given especially fair settlements when a lump sum offer is made which in large student loan matters can mean a reduction of tens of thousands of dollars.