Portfolio Recovery Associates, also seen or referred to as PRA, is a large scale debt collection company.  Similar to other debt collectors, Portfolio Recovery purchases “bad debt” from financial institutions and attempts to collect on this purchased debt.  Some of the debts which Portfolio Recovery may pursue are delinquent credit cards, retail accounts, credit union accounts, utility bills, and other past due debt.

While some collection efforts may only involve sending letters requesting payment on an account, you may also receive phone calls from PRA. If the debt remains unpaid, or payment terms are not met, PRA may opt to file a lawsuit in order to obtain a judgment on the debt. Often times, people first learn about Portfolio Recovery once they receive notice that they have been sued. The confusion often arises from PRA’s collection of a debt previously owed to a different company.

If you have been sued by Portfolio Recovery, you may still have options available to resolve either the debt or the lawsuit. Once a lawsuit is filed, the defendant has a certain number of days to file an answer. Otherwise, if no answer is filed, PRA may obtain a default judgment. Filing an answer within the allowed time will prevent PRA from obtaining a default judgment and allow the case to proceed to trial. While the case is still pending, you may also reach a settlement with PRA if you determine the debt is legitimate.

Keep in mind, once a judgment is obtained by PRA or any other creditor, different avenues for collection are available to the judgment creditor. For example, in Texas, the creditor can file an Abstract of Judgment in the property records. While the judgment creditor cannot place a lien on homestead property for most common debts, the Abstract of Judgment may act as a cloud on your title when you try to sell your house.

If you have been sued by Portfolio Recovery, or have been contacted by Portfolio to resolve a debt, you can contact Gordon Lusky LLP if you would like an initial consultation to review your options. We have experience representing clients in defending debt lawsuits, negotiating settlements on various debts, and even filing bankruptcy in the proper situation.