Archive for the ‘Uncategorized’ Category

Hospital Overcharges Discovered After Signing A Settlement with Debt Collection Law Firm

Saturday, May 5th, 2012

I was served with a debt collection lawsuit for an unpaid debt at a hospital. The amount seemed high, but I was not sure what to do and was afraid of having a default judgment entered against me, if I did not do something before my due date to respond to the complaint. I had not contacted any lawyer, so I did not know my rights.  I spoke with someone from the collection lawyer’s office and they sent me a stipulation agreement to settle in full, which I signed and returned, because the payments were affordable. I now learned from reviewing the hospital’s billing records that I was badly over charged and the amount that I agreed to pay was much more than I really should owe. What can I do about this?

My response:
Hospital overcharges and billing errors of uninsured patients are one epidemic that the medical profession has not done much to address. I have represented consumers sued on medical debts, including a couple of cases involving hospitals, which resulted in substantial billing adjustments for improper or excessive charges and errors.  Negligent or ineffective treatments may be one further area for adjusting excessive bills, when appropriate and timely raised by the patient.

In this situation, courts typically enforce written settlement agreements, unless you have convincing evidence that the agreement was induced by fraud. The fact that you did not investigate the bill before signing the settlement agreement may not be enough to avoid the settlement afterwards. Before deciding to not pay the settlement, please consult an attorney with the documentation and any evidence of fraud.  Not paying a settlement usually allows the debt collection attorney to obtain a full money judgment against you, which may make a bad situation worse, as this will show up on your credit report, wage garnishment, and levies on your bank account.

Robert Stempler
Twitter @RStempler

Mandatory Settlement Conferences for Debt Collection Lawsuits in Riverside

Monday, April 2nd, 2012

Riverside County Superior Court now has a special settlement program for debt collection lawsuits, under $25,000. The program is activated by the court, once the court receives the defendant’s answer. At that point, the court sets a date for the Mandatory Settlement Conference (MSC). Here’s a link to the MSC program information.

Bonus: unrepresented consumers (pro per) are invited to attend a free workshop to prepare for the MSC. No need to RSVP for the workshop, but they suggest attending at least a week before, so that you know what materials they suggest you bring on the day of the MSC.

Before you file anything in court, I suggest you review the short videos on my home page, because knowing your options is crucial, before you “just do something,” because it sounds good.

Robert Stempler
Twitter @RStempler

Tips to a Former Small Business Owner, Now Trying to Settle Remaining Debts

Friday, December 30th, 2011

I had a small construction business that went under a couple of years ago when housing took a nose dive.  Some business debts remain and I am getting calls from a manager of one of my suppliers, who wants me to settle up on a $2500 account, but I have nothing to pay them. They are now threatening to sue me for the debt.  Any suggestions? Should I call the manager?

My response:
If you can borrow the funds from family and friends to settle the entire debt for less than the full balance due, then that is a good reason to negotiate with the manager.  I would not propose that you simply borrow the full amount from your friends and family, so that you would owe the same amount of debt to them. When your pockets are empty, that is the time to negotiate with your creditors to settle for much less than the full amount, such that you reduce your debts to something that you can pay off quickly to your friends, when things turn around for you.

In settling any debts, be sure that you have written confirmation that the amount you are paying will settle the full balance.  It is not unusual for a debtor to believe that they have negotiated a very good settlement, then learn later that the money paid was applied merely as a credit towards the balance, and the creditor still demands payment on the rest (or files a debt collection lawsuit) or has assigned the unpaid balance to a debt collection agency.

I have posted on three legal guides on how to negotiate a debt, including specific information on the documentation that should be prepared to ensure that the debt is considered fully satisfied by both sides.  Link to Avvo.

Robert Stempler

Advice against co-signing a vehicle loan, which may end up in a debt collection lawsuit and bad credit history

Wednesday, August 10th, 2011

Should I co-sign a car installment contract for my son? He needs a car and is very responsible, but he has no credit score. I don’t have time to drive him around.

No. Over the years, I have represented too many parents and others who wanted to help out their child or friend purchase a vehicle and establish credit, only to end up on the wrong side of a debt collection lawsuit for the vehicle deficiency and negative credit history for their generosity. Remember the adage, the road to hell is paved with good intentions. If the typical installment contract is four to six years, can anyone reasonably expect that all payments will be paid timely over 72 months?

If you have already made this mistake and the vehicle is about to be or has been repossessed, please read my legal guide on which explains your rights under California law, following repossession at: Legal Guide.

Why should you throw caution to the wind and expose your years of diligent payments towards earning a good credit history? Whether it be the “good son” or someone who is more mature and has a positive track record, it is much more of a risk than the lenders are willing to accept, so why should you? If your son needs a car, he can borrow, call for a taxi, or ride with someone who has a car, and take the time to save for a good down payment and establishing his own good credit history with a small credit limit credit card or two.

Also, many new vehicle dealers offer first-time car buyer programs, consisting of favorable interest rates and terms. Such programs may not apply if there is a co-signer who has previously financed a vehicle. Verify this program by phone or online, before you set foot at any dealership. Of course, many car dealers will take advantage of the young buyer, so be sure to send him or her with an experienced relative who will help avoid price gouging and other underhanded practices and who will resist co-signing.

Robert Stempler

The Four Most Common Ways that Debt Collection Law Firms Can Get a Money Judgment

Sunday, July 24th, 2011

When consumers do not pay their credit card bills and other personal debts, the credit card bank or the debt collection agency that has acquired the unpaid account receivable, will refer the debt to a debt collection law firm. I have on my web site an article that explains this process, “Understanding why you were sued.”  Here’s the link to that: Sued Article.

If the debt collection law firm cannot get the debtor to agree to a settlement, then it files the summons and complaint with the court. These terms are described on my web site in an article entitled, “Terminology of Collection Lawsuits.”  Once filed, the debt collection agency then has someone (typically a private process server or deputy sheriff) attempt “service” of the summons and complaint and other papers on the defendant(s).

Once the defendant has been served, a proof of service is prepared and filed with the court to show the date, time, manner, and address where service was performed. After the required number of days have expired, if the court does not receive a response filed by the defendant, the clerk of the court will permit the debt collection law firm to file papers for a default judgment.

A default judgment can be prevented if the debtor files a response for him or herself in court and pays the court’s filing fee or arranges for financial aid to take care of the filing fee. Because the consumer does not know what they must do next, the debt collector is still able to get a judgment against them during the lawsuit.  Sometimes, the judgment is entered on the pleadings very early in the case (see my blog posting regarding judgment on the pleadings).  More typically, the court will review the evidence and enter a money judgment for the plaintiff on a motion for summary judgment or at trial.

To review, the most common ways for a money judgment to be entered in a debt collection case are by default judgment, judgment on the pleadings, summary judgment, or judgment following trial.  I have not had the honor of meeting a consumer who is properly equipped to represented him or herself in a debt collection case, which is why the first video on my web site’s home page discusses all possible options that may be available when sued on a debt collection lawsuit.

Robert Stempler

Settling a Debt: Documentation Made Easy

Sunday, February 27th, 2011

I was able to negotiate a good settlement with a debt collection agency. It is about half of what I had originally owed to the original credit card bank for this account. I want to be sure that I handle this properly, so that my payments are properly credited and the settlement documented. Can you offer any tips to protect myself?

My response:

I have prepared for such problems two new legal guides on  In particular, please read my Debt Settlement Guide #2, which gets into specifics on the documentation that you should have of a settlement agreement for a debt, before you pay anything to settle a credit card debt.  Also, Guide #3 freely offers specific language (several “Debt Settlement Terms in a Box”) so anyone can have free sample settlement terms to settle a debt with any debt collection agency or creditor.

You no longer need to rely on the debt collector to handle the paperwork or a debt settlement company. Of course, I offer give it to you for FREE. Please read the legal guides carefully and contact me for further help or if you are sued on the debt.

Robert Stempler

Deadline to File A Claim Against Mann Bracken is June 25, 2010

Thursday, June 24th, 2010

If you have a claim against debt collection law firm, Mann Bracken, LLP, the deadline to file is Friday, June 25, 2010.  I cannot give you legal advice on Maryland law, but you are supposed to send a copy of this claim to the receiver’s attorney, James M. Hoffman of Offit Kurman, P.A., in Bethesda, Maryland.  You should ensure timely delivery before close of business, at the Circuit Court for Montgomery County. 50 Maryland Avenue; Rockville, MD 20850 and reference the case as: Mann Bracken, LLP v. Connell A. Loftus, Esq.; Case No. V327646.

I am aware that many of the claims submitted were by companies that provided services, such as process serving, to this massive debt collection law firm, which had close ties with Axiant, which previously filed for bankruptcy.  I was advised that since all Mann Bracken’s law offices have been closed and their staff let go, it is unlikely Mann Bracken will ever be back in business or be able to pay all the claims submitted.

If you are sued or harassed by a debt collector, you have substantial rights that you should protect and not delay, so that a default judgment is not entered against you.  Please review your options at and contact me if you have any questions or need representation against a debt collector or creditor.

Court Furlough Days: Why not on a Monday or Friday?

Wednesday, June 16th, 2010

Starting 2009, to reduce the budget problems of the State, California Superior Courts have been closed on the third Wednesday of each month (see LA Times Article at Today, for example, June 16, 2010, the court is closed, which affects not only the judges, court clerks, court reporters, and deputies, but also the juries, parties to litigation, and lawyers.

I am trying to understand the logic in closing on a Wednesday, as compared with Friday or Monday, that is not already a holiday. According to the Judicial Council’s report (see page 3 at if they close the Superior Courts on a Monday or a Friday, it would impose longer detentions over the weekend and thus increase costs on local jails. I have not seen how many people that would impact, but I seriously doubt that many people will be affected because their arraignment is delayed by one day, which already happens when Monday is a holiday.  However, perhaps the criminal court buildings should be exempted from furlough, in any event, in large counties, such as Los Angeles, San Diego, and San Francisco, or opened for this limited situation of hearing arraignments on a “better” furlough (Monday or Friday).

More important in my mind is the extra cost to close down for a day on Tuesday and reopen from the closure on Thursday, only to close again for the weekend two days later. There is likely extra cost in closing for a day and reopening that the Judicial Council did not consider.

Finally, we hear in the news how the court clerks, deputies, and judges dislike the furlough, as it is a nuisance and breaks up the work week. Of course it does.  What employer proposes closing in the middle of the work week, when the closure could be on any Friday or Monday? Of course people that work there would prefer a three day weekend to a single day off. Why can’t the Judicial Council consider job satisfaction as a savings, when they decided on the furlough day?

I hope when the Judicial Council reconsiders the furlough for year 2010/2011 they re-evaluate the impact on the court clerks, deputies, and judges at the courthouse and the costs of closing and reopening mid-week.