If Portfolio Recovery Associates has filed a lawsuit against you, file a written answer with the court before your response deadline runs out. That single step preserves every defense you have and forces PRA to actually prove its case, which debt buyers frequently cannot do. Most people sued over consumer debt never respond, and almost all of them lose by default. Don’t be one of them.
Your Response Deadline
You’ll be served with a summons and a complaint naming the original creditor, an account number, and the amount PRA claims you owe. Your clock starts the day you’re served. In federal court, you have 21 days to file an answer. In state court, the window is typically 20 to 30 days depending on where you live.
Miss the deadline and the court will almost certainly enter a default judgment. PRA wins automatically, without ever presenting evidence, and gains the power to garnish wages, levy bank accounts, and put liens on property you own. If you genuinely cannot meet the deadline, file a motion for an extension before it expires. Courts routinely grant short extensions for good cause, especially to people representing themselves.
Filing Your Answer
Your answer is a written response to each numbered paragraph in PRA’s complaint. For every allegation, you either admit it, deny it, or state that you lack enough information to admit or deny. When in doubt, deny. Saying you don’t have enough information to confirm a balance or the details of a debt that may have changed hands multiple times is not dishonest — it’s accurate.
Your answer should also raise any affirmative defenses. These are legal reasons the case should fail even if PRA’s facts are true. Common defenses in debt buyer cases include:
- Statute of limitations: the debt is too old to sue on.
- Lack of standing: PRA can’t prove it owns the debt.
- Improper service: you weren’t served according to the rules.
- Incorrect amount: the balance PRA claims doesn’t match reality.
- Wrong venue: the case was filed in the wrong court.
The venue defense is worth checking immediately. Under the Fair Debt Collection Practices Act, a debt collector must sue either where you signed the original contract or where you live when the lawsuit is filed.1Office of the Law Revision Counsel. 15 U.S. Code 1692i – Legal Actions by Debt Collectors A case filed anywhere else violates federal law.
Most states don’t charge a filing fee to submit an answer in a consumer debt case, though a handful do. If cost is a barrier, ask the clerk about a fee waiver based on income.
Making PRA Prove the Debt
PRA didn’t lend you money. It bought a spreadsheet of account data from someone else, often for pennies on the dollar. To win, PRA must prove a complete chain of ownership from the original creditor to itself, and it must show that you owe the specific amount claimed. That takes real documentation, not just a printout of PRA’s own records.
The kind of proof courts expect includes the original signed credit agreement, account statements from the original creditor, and assignment documents for every sale of the debt along the way. Gaps in that chain can sink the case. In 2015, the Consumer Financial Protection Bureau ordered PRA to stop filing lawsuits without an intent to prove the underlying debt, after finding it had filed misleading affidavits in collection cases.2Consumer Financial Protection Bureau. Portfolio Recovery Associates, LLC
Use Discovery
Discovery is your right to demand documents and sworn answers before trial. It’s the most useful tool you have, because debt buyers often lack the records to back up their claims. Ask PRA to produce:
- The original signed credit agreement
- Complete account statements from the original creditor
- Every bill of sale or assignment in the chain of ownership
- The price PRA paid for the debt
- A calculation of the balance, including any interest or fees added after charge-off
- The charge-off date and the date of your last payment
If PRA can’t produce the original agreement or a complete chain of assignment, its case weakens sharply. Many debt buyer lawsuits settle or get dismissed at this stage because the documentation simply isn’t there.
The Statute of Limitations
Every state sets a deadline for suing over unpaid debt. For credit card debt, that period is most commonly three to six years, though some states allow longer.3Consumer Financial Protection Bureau. Can Debt Collectors Collect a Debt That’s Several Years Old? If PRA sued after that window closed, raise it as an affirmative defense in your answer. Suing on a time-barred debt may also violate the FDCPA, which opens the door to a counterclaim.
Watch one trap: in many states, making even a small payment or acknowledging the debt in writing can restart the clock.3Consumer Financial Protection Bureau. Can Debt Collectors Collect a Debt That’s Several Years Old? If PRA contacts you and you send $20 to show good faith, you may have just handed PRA a fresh window to sue. Don’t pay or acknowledge anything in writing until you know whether the debt is time-barred where you live.
FDCPA Rights and Counterclaims
PRA is a debt collector under federal law, so the Fair Debt Collection Practices Act applies to everything it does. Within five days of first contact, PRA must send a written validation notice with the amount of the debt, the name of the original creditor, and notice of your right to dispute within 30 days.4Office of the Law Revision Counsel. 15 U.S. Code 1692g – Validation of Debts Send a written dispute within that 30-day window and PRA has to stop collection until it verifies the debt.
The FDCPA also bars debt collectors from misstating the amount owed, threatening actions they can’t legally take, or suing on debts they know are time-barred.5Federal Trade Commission. Fair Debt Collection Practices Act Text If PRA violated any of these, you can file a counterclaim or a separate lawsuit. A successful FDCPA claim entitles you to actual damages plus up to $1,000 in statutory damages, and PRA has to pay your attorney fees.6Office of the Law Revision Counsel. 15 USC 1692k That fee-shifting rule is why consumer attorneys sometimes take these cases without charging you anything upfront.
Other Ways to Respond
Motion to Dismiss
If the complaint itself is legally deficient, you can file a motion to dismiss, either instead of or alongside your answer. Common grounds are lack of standing, wrong venue, or a complaint that doesn’t state enough facts to support the claim. The bar is higher than raising the same points as defenses, but a granted motion ends the case fast.
Compel Arbitration
Many original credit card agreements contain mandatory arbitration clauses, and those clauses typically survive the sale of the debt. Federal courts have held that a debt buyer steps into the shoes of the original creditor and is bound by the same arbitration agreement. That cuts both ways: you can invoke the clause and force PRA out of court.
Why do that? Arbitration is expensive for the party filing the claim. PRA’s business model depends on high-volume, low-cost lawsuits where most defendants don’t appear. Arbitration filing fees run into the thousands for the business side, plus the arbitrator’s hourly rate. On a $2,000 credit card debt, the math often stops working for PRA, and cases frequently settle or get dropped after a motion to compel arbitration is granted. File the motion early. Litigate too much in court first and a judge may find you waived the right.
Settle
If you owe some version of the debt and want it done, settlement is always available. PRA bought the debt at a deep discount, so there’s room to negotiate. Settlements at 40 to 60 percent of the claimed balance are common, though the number depends on the strength of the evidence, the age of the debt, and your finances.
Get every settlement in writing before you pay anything. The agreement should state the exact amount, confirm the payment resolves the debt in full, and specify what PRA will report to the credit bureaus. On that last point, PRA states on its own website that after your final payment posts, it will request deletion of its tradeline from your credit report within approximately 30 days.7Portfolio Recovery Associates. Credit Reporting That’s more favorable than the standard “paid” update many collectors use. Make sure the deletion commitment is written into the agreement.
If You Already Have a Default Judgment
Missing the deadline is bad but not always final. You can file a motion to vacate the default judgment. In federal court, Rule 60(b) allows relief for mistake, excusable neglect, or fraud by the opposing party, and the motion generally must be filed within a reasonable time, no more than one year for most grounds.8Cornell Law Institute. Federal Rules of Civil Procedure Rule 60 – Relief From a Judgment or Order State courts have similar rules with varying deadlines.
If PRA never properly served you, that’s a stronger basis, because improper service can make the judgment void rather than merely voidable. A void judgment can sometimes be challenged with no time limit at all.8Cornell Law Institute. Federal Rules of Civil Procedure Rule 60 – Relief From a Judgment or Order When you file the motion, you’ll usually need to show both a valid reason you didn’t respond and a real defense to the underlying claim.
What PRA Can Collect If It Wins
If PRA obtains a judgment, its main collection tools are wage garnishment, bank levies, and property liens. Each has legal limits.
Federal law caps wage garnishment for consumer debt at the lesser of 25 percent of your disposable weekly earnings or the amount by which those earnings exceed $217.50 (30 times the $7.25 federal minimum wage).9Office of the Law Revision Counsel. 15 U.S. Code 1673 – Restriction on Garnishment Below that weekly threshold, wages can’t be garnished at all. Many states impose lower caps.
Social Security is strongly protected. Federal law bars private creditors from garnishing, levying, or attaching Social Security payments.10Social Security Administration. Social Security Act Section 207 That protection follows the money into your bank account, though you may need to show the bank which funds came from Social Security if PRA attempts a levy. SSI is similarly protected.
State exemption laws shield other assets from judgment creditors. Homestead exemptions range from modest amounts to unlimited protection depending on the state. Clothing, basic household goods, and tools of your trade are typically exempt. You often have to claim these exemptions by filing paperwork with the court.
Judgments accrue post-judgment interest, commonly around 8 to 12 percent annually depending on state law. The longer a judgment sits, the larger it grows, which is why resolving one quickly matters even after you’ve lost.
Tax Consequences of Settling for Less
If PRA agrees to accept less than the full balance, the forgiven amount may count as taxable income. Any creditor or debt collector that cancels $600 or more of debt must file a Form 1099-C with the IRS reporting the canceled amount.11Internal Revenue Service. About Form 1099-C, Cancellation of Debt Settle a $5,000 claim for $2,000 and you could receive a 1099-C for the $3,000 difference.
There’s an important exception. If you were insolvent when the debt was canceled, meaning your total debts exceeded the fair market value of everything you owned, you can exclude the canceled debt from income up to the amount of your insolvency.12Internal Revenue Service. Publication 4681 – Canceled Debts, Foreclosures, Repossessions, and Abandonments People being sued by debt buyers over old credit card balances often meet that definition. The Insolvency Worksheet in Publication 4681 walks through the calculation. Include retirement accounts and pension interests on the asset side, and all debts on the liability side, not just the one being settled.
Bankruptcy as a Stop
Filing bankruptcy triggers an automatic stay that immediately halts PRA’s lawsuit and every other collection action against you.13Office of the Law Revision Counsel. 11 U.S. Code 362 – Automatic Stay The stay stops wage garnishments, bank levies, and enforcement of existing judgments. Credit card debt from a debt buyer is unsecured and generally dischargeable in both Chapter 7 and Chapter 13.
Bankruptcy is a serious step with long-term credit consequences, and it usually doesn’t make sense when PRA’s lawsuit is your only real financial problem. If you’re also behind on medical bills, other cards, or facing garnishments from multiple creditors, it can be the most practical route. A bankruptcy attorney can weigh the protection against the cost and the credit impact for your situation.