We frequently defend consumer debt cases against Barclays Bank and Wells Fargo. Both are original creditors meaning they have not sold their debt to a third party debt-buyer. These creditors are almost always represented by Tenaglia and Hunt, a common debt collection law firm whom pursues collection efforts and litigation in both New York and New Jersey. Collection commonly leads to litigation and litigation often results in default judgments. A default judgment is usually the result of poor or improper service or because a consumer has moved to a new address. A default judgment can lead to wage garnishment, a bank levy or a lien being placed on real property. There is also judgment interest that accrues causing the total amount to increase annually. We have seen law firms like Tenaglia and Hunt pursue people 19 years later to enforce a judgment where the debt has increased five times or more because of the interest and fees. Judgments are good for 10 years renewable for another 10 years so banks like Barclays and Wells Fargo have plenty of time to find assets and or property while allowing interest to accrue.
If a lawsuit is received from Wells Fargo or Barclays then the most important step is submitting an answer with defenses which will protect against a default judgment and keep the burden on these creditors to prove their case. If a default judgment is obtained then it is imperative to file an Order To Show Cause to vacate the default judgment. This sort of motion will also ask for a stay of judgment enforcement activity so a garnishment is stopped and or funds in a frozen bank account cannot be turned over to the creditor. Vacating a default judgment will not dismiss the overall action but it will give the consumer a chance to defend themselves on the merits so that they can assert their defenses. Filing a motion to vacate and vacating the judgment also brings leverage to the consumer so that they can negotiate a favorable settlement with Tenaglia and Hunt reducing the balance of a Barclays or Wells Fargo account anywhere between 30%-70% off of the full balance. This is often the most practical resolution on balances under $20,000 as it saves the consumer money and eliminates the risk of losing the case.