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Categorized | Lawsuits, LVNV

Sued by LVNV Funding – Who Are They?

The Sheriff knocks at your door or you receive a certified letter and find that a lawsuit has been filed against you by LVNV Funding.  Your first thought should be… who is LVNV, I’ve never heard of them?

LVNV Funding is a junk debt buyer.  They are a subsidiary of a very large debt collection/buyer called Sherman Originators.  This is a company that buys delinquent credit card accounts, often 5,000 to 10,000 accounts, for pennies on the dollar.  Yes, that’s right, they purchase credit card accounts that are in default.  This is perfectly legal in any state in the U.S.  The statistics change, but it appears that these companies pay between 1.5 and 3.5 cents on the dollar to purchase these accounts… that’s pretty cheap if you ask me.  I’d like to purchase almost anything for 2 cents on the dollar.

Why do they purchase delinquent credit card accounts like yours?  Well, to make a profit, of course.  When they buy an account, they get to “step into the shoes” of the original creditor.  That is, they are allowed to try to collect the entire amount from you.  If you pay them, they make a HUGE profit on their expenditure.   Let’s say that you have a $5000 credit card debt with Chase.  You default, likely because you have a health problem, divorce, or job loss.  Chase doesn’t want to sue you so they sell the debt to LVNV.  LVNV then sues you.  You now happen to be back on your feet so you think about paying the debt.  If you do pay the $5000, remember, LVNV has only paid about $100 to acquire that claim. That is a very large profit, wouldn’t you agree?

The truth of the matter is that its a numbers game for LVNV.  They know that about 8o% of the people whom they sue will either roll over and pay the bill, OR, will put their head in the sand and do nothing.  Right off the bat, LVNV wins 80% of the time.  Of the remaining 20%, LVNV knows that a little more than half will try to defend themselves (this is a big mistake).  So now LVNV has won 90% of the time that it files a claim.  Less than 10% of the people who are sued by LVNV actually hire an attorney.  (Make sure that don’t just hire any old attorney, hire a Consumer Attorney).

LVNV Funding uses a few large collection firms to handle their cases in Pennsylvania.  Currently, they are using Apothaker and Associates and Hayt, Hayt and Landau.  These are two fine collection firms, they know how to handle credit card cases.  These are not firms that you want to go up against without legal representation.

So the big question is, what happens when you hire a consumer attorney?  Well, it depends upon which court you are in.  If the lawsuit is in the local District Justice court, then you will let the attorney go to the hearing and argue the case.  This most often can result in a judgment in your favor.  LVNV is often unprepared at Magistrate hearings.  If the lawsuit is filed in the Court of Common Pleas of your county, then a different approach is necessary.  A written response needs to be filed and for LVNV cases, the most appropriate response is often to file Preliminary Objections.  These objections are a statement to the court that the lawsuit is defective.  (All LVNV lawsuits are defective when initially filed).  The court will rule on the objections and likely force LVNV to come up with more evidence.  When they cannot come up with more evidence, the case is often tossed.

If you are sued by LVNV, please do not contact them without speaking to a consumer attorney, whether its someone from my firm or another.  These cases are best handled by an attorney, not by you.

Credit Card Lawsuits

If you are faced with a credit card lawsuit, whether its an original creditor or a junk debt buyer, contact my office at 412-823-8003 right away. We offer a free, no obligation review of any credit card based lawsuit that is filed in PA.

FDCPA Attorneys

Many Debt Collectors threaten people, that's a fact. Threats of wage garnishment, jail, fraud charges and contacting employers, friends and relatives happens every day to people just like you. The truth is that most of these threats are illegal. If a debt collector is threatening you, contact our office at 412-823-8003 for a free initial consultation.