Wells Fargo is one the largest banks in America. Because of their size, Wells Fargo is also one of the largest consumer lenders around. What happens when a consumer stops making payments on a Fargo debt? Read on to find out more.
When a person stops paying a debt, we say that they have “defaulted” on the account. Therefore, a debt default triggers several consequences.
First, a lender will usually impose late payment fees and penalty interest rates. Second, a lender might cut off access to additional credit. Moreover, a lender can reduce the available credit or altogether close the account
Another interest consequences is that other lenders might see the default and impose their own restrictions on other accounts.
A lender will typically try to collect their own account, and if unsuccessful, refer it to outside collection firms.
Wells Fargo Lawsuits
What happens to a borrower that does not pay Wells Fargo? After a certain amount of collection attempts, Wells Fargo will refer a defaulted account to a law firm for litigation.
This means that Wells Fargo will sue its own customers over defaulted accounts. In some cases, I have seen that Wells Fargo sues under their own name. Other times, Wells Fargo will sell the debt to a third party for collection.
In either case, a Wells Fargo lawsuit is a big deal. Many people ignore these lawsuits and then are surprised later on when Wells Fargo garnishes their wages or takes money directly from their bank accounts. However, there are options.
What to do if You Are Sued by a Bank or Credit Card Lender
My first recommendation is simple: don’t ignore the lawsuit! Plenty of folks don’t take prompt action after learning of a bank lawsuit. This is a huge mistake.
In the California Superior Court, a defendant has just 30 days to formally respond to lawsuit papers after being served. If the defendant does not respond in that time frame, the plaintiff automatically wins the case.
In fact, I would estimate that a vast majority, maybe 95% or more of bank lawsuits end in default judgements. A “default judgement” is where the defendant did not bother to defend the lawsuit.
A defendant in a credit card lawsuit should immediately contact an attorney for help. In fact, Options include defending the lawsuit, negotiating a settlement, or even bankruptcy.
Is a bank or lender suing you over a defaulted debt? Call my office at (916) 333-2222 today to discuss your options. Do not delay!