Debt Defense – Learn the Lingo
Common Debt Lawsuit Terminology – Explained for Consumers
1. Answer
A written response you file with the court after you’ve been served with a lawsuit.
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It tells the court whether you admit, deny, or don’t know about each allegation in the Complaint.
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Filing an Answer prevents a default judgment and keeps you in the case.
2. Complaint
The legal document the creditor or debt buyer files to start the lawsuit.
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Lists who’s suing you, why, and how much they claim you owe.
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Often includes the legal basis, such as “breach of contract” or “account stated.”
3. Summons
A court document that comes with the Complaint.
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Tells you that you are being sued and gives you the deadline to respond.
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If you ignore it, the creditor can get a default judgment.
4. Default Judgment
A court order that the creditor wins automatically because you didn’t respond or appear in court.
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Allows immediate collection through wage garnishment, bank levy, or liens (depending on your state’s laws).
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Harder to fight after it’s entered.
5. Service of Process
The formal way the lawsuit papers are delivered to you.
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Can be in-person, at your home, or sometimes by mail.
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If service isn’t done correctly, you may be able to challenge the lawsuit.
6. Plaintiff
The person or company suing you.
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In debt cases, this may be the original creditor or a debt buyer who purchased the account.
7. Defendant
The person being sued — you in a consumer debt case.
8. Debt Buyer
A company that purchases charged-off debts from original creditors, often for pennies on the dollar, and then tries to collect the full amount.
9. Statute of Limitations
The time limit for a creditor to sue you for a debt, starting from the date of your last payment or default.
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Varies by state (often 3–6 years for credit cards).
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If it’s expired, you may have a defense that can get the case dismissed.
10. Standing
The legal right of the plaintiff to sue you.
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In debt cases, they must show they actually own your account and have proof of the transfer from the original creditor.
11. Discovery
The stage where each side can request information and documents from the other.
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Can include written questions (interrogatories), requests for documents, and depositions.
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Debt buyers often can’t produce key documents — which can help your defense.
12. Motion
A formal request asking the court to take a specific action. Examples:
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Motion to Dismiss – End the case because the lawsuit is defective.
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Motion for Summary Judgment – Decide the case without trial because there are no factual disputes.
13. Garnishment
When a creditor takes part of your wages or money from your bank account to pay a judgment.
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Rules vary by state, and certain funds (like Social Security) are usually exempt.
14. Levy
A court-ordered seizure of funds from your bank account.
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Usually happens after a judgment.
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You may be able to file a claim of exemption to protect certain money.
15. Lien
A legal claim against your property (such as real estate) for unpaid judgment debt.
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May need to be paid off before selling or refinancing.
16. Mediation
A meeting with a neutral third party who tries to help you and the creditor reach a settlement without going to trial.
17. Settlement
An agreement to resolve the lawsuit, usually involving payment of a reduced amount or payment plan.
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Should always be in writing before you pay.
18. Judgment
The court’s final decision on your case.
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Can be in your favor (case dismissed) or against you (you owe money).
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If against you, triggers collection rights for the creditor.
19. Appeal
A request for a higher court to review and possibly change the lower court’s decision.
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Strict deadlines apply (often 10–60 days depending on state and court type).
20. Claim of Exemption
A legal filing to protect certain income or property from being taken to satisfy a judgment.
💡 Pro Tip:
Even if you think you owe the debt, responding to the lawsuit and understanding these terms gives you leverage to settle for less, avoid illegal collections, or win outright.
