After all amicable ways to recover funds from the debtor fail, the account may be considered for the final step – Legal collections. Learn how legal teams handle pre-litigation, documentation and lawsuits.
Step 1: Initial Assignment to Pre-litigation Team
When an account enters “Step 4 – Legal,” it is initially assigned to the “Pre-litigation” team. The Kinum’s internal legal team reviews the account and sends a final communication to the debtor, notifying them that their debt is under review in the legal department. The main objective is to provide the debtor with a final opportunity to resolve the debt before the account is assigned to an attorney for further review.
Step 2: Verification of Backup Documentation
If the debt remains unresolved, the next step is to verify that the backup documentation provided by the client matches the balance placed with Kinum. This may involve additional requests to the client for documentation and verification. Once the backup documentation is reviewed and correctly applied to the account, the appropriate attorney is determined to receive the account. Kinum has a national network of attorneys to help file the case in the right jurisdiction.
Step 3: Initial Attorney Communication
The attorneys adhere to specific legal guidelines in their communication. Once the attorney makes their initial demand with the customer, they typically allow a 35-day window of response before proceeding.
Step 4: Decision to File a Lawsuit
If the attorney finds that there is a strong case, meaning there is a high chance of winning and assets are available to satisfy the judgment, the client is asked if they want to proceed with filing a lawsuit. Payment for the court filing fee, which varies depending on the location, is required. However, the first amount recovered will go to reimburse the client 100% of this fee. Once the client agrees to proceed, the necessary steps to prepare for the lawsuit are taken. The attorney serves a summons to the consumer, the client fills out an affidavit, and then it is up to the court to get the case on the docket. The legal team provides the best representation and support to clients throughout the process.
Step 5: Court Process
There is no fixed timeframe for this process, and the court process can be slower than anticipated. If the debtor fails to attend the hearing, a default judgment is usually obtained. If they attend, a standard judgment is given. If the judgment is awarded to the client, the phase of executing the judgment begins. This may result in another hearing with the judge. If the debtor agrees to payment, updates are awaited. If no payments are made, the client is asked if they would like to return to court. If the customer is unwilling to make voluntary payments, the attorney may move to potential wage garnishment or filing a lien on their assets to collect the money owed to the client.
Step 6: Risk Consideration
Filing a lawsuit against a consumer carries risks, which attorneys carefully weigh, keeping in mind the client’s best interests. The legal team is dedicated and provides recommendations based on unique circumstances.