I've been sued by midland fundingSo you’ve been sued by Midland Funding. And, like many people, you’ve never even heard of Midland Funding. Let’s answer the two most immediate questions running through your head.

1. Who is Midland Funding?

Answer:  They are a debt collector.  A big debt collector. They buy up tons of defaulted credit card debt, for mere pennies on the dollar.

2. Why Have I Been Sued By Midland Funding?

Answer:  It’s simple really – they want to extract as much money from you as possible. They bought the debt against you at a big discount, and now they are playing a numbers game.  If they can collect more on that debt than they paid for it, then they make a profit.  And do not be fooled – maximizing profits is Midland Funding’s sole objective.  So it makes perfect sense that a pipeline of consumers are continually being sued by Midland Funding.  It’s part of the business model.

Here’s How It Goes Down:

You are sued by Midland Funding.  From here, its wants a judgment. More specifically, Midland prefer what’s called a “default judgment.” This is where you fail to file a timely answer, and they get a judgment for their full claim amount without ever having to litigate the matter.  A default judgment provides Midland the maximum benefit, with the minimal cost.

After obtaining a judgment, Midland commences collecting against you.  If you have a job, Midland can garnish your wages.  If you own significant assets (such as a home or vehicle, with equity), Midland can often levy and sell such assets to pay toward your debt. Making matters worse, the amount owed on the debt will continue to grow, due to interest (in CA, this is typically 10%/year), plus the accumulation of Midland’s attorneys’ fees.

Strategy:  To Defend, Or Find An Alternative Approach?

If you are swimming in debt, then Midland Funding is probably just one of many creditors. If this is your situation, then you need a more comprehensive solution. Bankruptcy (either chapter 7 or chapter 13) can be perhaps the most effective tool. For many individuals, bankruptcy provides a means to discharge a large portion of their debt. It can also halt any ongoing collection lawsuits. However, whether to file (and which chapter to choose) are questions to ask a qualified bankruptcy attorney.  But if you can discharge the debt to Midland Funding, then you can essentially sidestep the litigation, and simultaneously deal with your other creditors as well.

If You Are Going to Fight, Remember These 4 Things

If it makes sense to defend the lawsuit against Midland, then you’ll need to do so competently (or hire an attorney to do so).  And remember these four key points:

  1. You need to file a timely response.  Otherwise Midland will obtain a default judgement against you;
  2. Do not agree to a partial payment in the middle of the fight.  Unless you are settling the entire dispute, tendering partial payment is like throwing money in the garbage.
  3. There are many “debt settlement” services out there.  View them all with serious suspicion.  Most of these services are simply looking to take your money.  And they will be happy to do so, without ever solving your problem.
  4. If you are serious about fighting the lawsuit, you really should hire counsel. A decent attorney in this field can likely resolve your litigation for a fee between $1,500 and $3,000, plus costs.  (Although my firm does not provide this service, we are happy to provide a referral).

Other Creditors Who May Sue You

While Midland Funding is one of the biggest debt purchasers in the game.  Even if you haven’t been sued by Midland Funding, you may have been sued by one of the parties listed below.  This list is non-exhaustive, but here are some of the players in Oakland, and the greater Bay Area:

  • Portfolio Recovery Associates, LLC
  • Capital One Bank
  • National Asset Recovery Services
  • Discover Financial Services, LLC
  • American Express (AMEX)
  • Chase Credit
  • Enhance Recovery Company
  • Debt Recovery Solutions
  • Debt Management, Inc.
  • Synchrony Bank
  • Comenity Bank
  • LoanMe

Disclaimer:  Unless you have executed a written document, retaining Hartman Bankruptcy Law, we are not operating as your attorney.  Please review our full Legal Disclaimer.