Dealing with a lawsuit from a debt collector can feel overwhelming, especially when the company suing you is one of the largest debt buyers in the country. If you have been served with court papers from Portfolio Recovery Associates, LLC (PRA), it is important to understand your rights under New York law and federal law, and to act quickly to protect yourself. This article explains who Portfolio Recovery Associates is, why they file lawsuits, what defenses you may have in New York, and how a consumer protection lawyer can help you fight back.
Who Is Portfolio Recovery Associates?
The company known as Portfolio Recovery Associates, LLC is a debt buyer. This means they purchase defaulted consumer debts—such as old credit card accounts, personal loans, and other unsecured obligations—from original creditors or other debt buyers for pennies on the dollar. After purchasing the debt, PRA attempts to collect the full balance from consumers.
PRA is a large company with nationwide operations. Instead of hiring outside law firms, they often use their own in-house counsel to file lawsuits in state courts. This allows them to handle large volumes of cases at relatively low cost, which is why so many New Yorkers find themselves facing PRA in court.
If you are being sued by Portfolio Recovery Associates, you are not alone. Thousands of New York residents have been served with lawsuits by this company. Fortunately, defenses may exist that can help you avoid a judgment or reach a more favorable resolution.
How Debt Collection Lawsuits Work in New York
When PRA sues you in New York, you will typically receive a summons and complaint. The summons notifies you that you are being sued, and the complaint outlines PRA’s allegations about the debt. You usually have 20 days to respond if you were personally served, or 30 days if served by another method (CPLR § 3012).
If you fail to respond, PRA may seek a default judgment against you. A default judgment means the court automatically rules in PRA’s favor because you did not file an answer in time. Once a judgment is entered, PRA has powerful tools under New York law to collect, including:
- Wage garnishment: PRA can garnish up to 10% of your gross wages (CPLR § 5231).
- Bank levies: PRA can freeze and seize money from your bank account (CPLR § 5222).
- Liens against real property: PRA can place a lien on your home or other real estate (CPLR § 5203).
Because the consequences of a judgment are serious, it is critical to respond to a lawsuit in a timely manner.
Common Defenses to PRA Lawsuits in New York
You may have defenses available under New York law or federal law that can help you challenge PRA’s case. Every situation is different, but some of the most common defenses include:
Lack of Standing
Portfolio Recovery Associates must prove that they own your specific account and have the legal right to sue you. As a debt buyer, PRA must provide documentation showing the chain of assignment from the original creditor to them. If they cannot prove ownership with admissible evidence, the court may dismiss the case.
Statute of Limitations
In New York, most consumer debt cases have a statute of limitations of six years (CPLR § 213. However, in April 2022, New York amended the law to shorten the statute of limitations for consumer credit transactions to three years (CPLR § 214-i). This change applies prospectively. If PRA files a lawsuit after the statute of limitations has expired, you can raise that as a defense to dismiss the case.
Insufficient Documentation
Debt buyers like PRA often sue based on incomplete or inaccurate records. They may not have account statements, payment histories, or agreements with the original creditor. If PRA cannot provide sufficient documentation to prove the debt is valid and the amount claimed is accurate, you may be able to challenge their case.
Improper Service
New York has strict rules on how lawsuits must be served (CPLR § 308). If PRA failed to serve you properly, you may be able to vacate a default judgment or dismiss the case. Improper service is a common issue in debt collection lawsuits.
Identity Theft or Mistaken Identity
If the debt does not belong to you, or if you were the victim of identity theft, you can defend the lawsuit by showing that you are not responsible for the account.
Negotiating Settlements and Payment Plans
Even if PRA can prove its case, you still have options. New York consumer protection lawyers regularly negotiate with PRA to resolve lawsuits through settlements. In many cases, you may be able to achieve:
- A significant reduction of the balance claimed
- Waiver of interest and fees
- Affordable, interest-free payment plans
By working with an attorney, you can avoid the harsh consequences of a judgment while resolving the debt on terms you can manage.
Why You Should Not Ignore a PRA Lawsuit
Ignoring a lawsuit from Portfolio Recovery Associates is one of the biggest mistakes you can make. Once PRA obtains a judgment, reversing it can be difficult. A judgment will appear on your credit report and may last for up to 20 years in New York (CPLR § 211), making it one of the most long-lasting financial burdens you can face.
Responding promptly gives you the chance to raise defenses, challenge PRA’s evidence, and protect your income and assets.
How a New York Consumer Protection Lawyer Can Help
A consumer protection lawyer experienced in defending PRA lawsuits can provide critical assistance. Here is how an attorney may help you:
- Review the complaint and identify defenses
- File an answer in court to prevent default judgment
- Challenge PRA’s evidence and witnesses
- Negotiate favorable settlements or payment plans
- File motions to dismiss if PRA violates court rules or deadlines
- Protect your rights under state and federal law, including the Fair Debt Collection Practices Act (FDCPA)
Having a lawyer on your side levels the playing field. PRA has teams of attorneys handling these cases every day—so should you.
Federal Protections Under the FDCPA
In addition to New York state laws, you also have rights under federal law. The Fair Debt Collection Practices Act (15 U.S.C. § § 1692–1692p) prohibits debt collectors from using abusive, deceptive, or unfair practices. If PRA violates the FDCPA, you may be entitled to damages, and those violations can also be raised as part of your defense strategy.
New York Consumer Protection Lawyer
If you are being sued by Portfolio Recovery Associates in New York, you do not have to face it alone. You may have defenses that can help you beat the case or negotiate a favorable resolution. Law Office of Simon Goldenberg, PLLC has extensive experience defending consumers against PRA and other debt buyers.
Take action now to protect your financial future. To learn more about your legal rights and options, contact Law Office of Simon Goldenberg, PLLC by calling (888) 301-0584 or contacting us online for a free consultation.