Sued by Encore Capital Group in Nevada? Here's What to Do Next

2015 · consent order

$52M+ total ($42M consumer refunds + $10M CFPB civil money penalty), plus order to stop collection on $125M+ in debts

CFPB consent order against Encore Capital Group, Midland Funding, Midland Credit Management, and Asset Acceptance finding the companies attempted to collect debts they didn't own or that were inaccurate, relied on robo-signed affidavits in court, and pressured consumers with misrepresentations about lawsuits. The order required documentation before filing suit and disclosures when collecting on time-barred debt.

CFPB source

2020 · lawsuit settled

$15M CFPB civil money penalty + $79,308.81 consumer redress; extended 2015 order conduct provisions for five additional years

CFPB filed suit and reached a stipulated settlement finding Encore and its subsidiaries violated the 2015 consent order by suing consumers without possessing required documentation, failing to provide required disclosures when consumers requested loan documentation, and suing on debts whose statutes of limitations had expired in violation of the FDCPA and CFPA.

CFPB source

Statute of Limitations Defense

In Nevada, the statute of limitations for credit card debt is 6 years. If your last payment was more than 6 years ago, the debt is time-barred. Encore Capital Group has been the subject of CFPB findings related to suing on time-barred debts — check your dates carefully and raise the SOL defense in your Answer.

Lack of Standing / Chain of Title

As a debt buyer, Encore Capital Group must prove they actually purchased your specific account. Demand the complete chain of title — the purchase agreement, bill of sale, and assignment documents. In Nevada courts, failing to produce this documentation can result in dismissal.

Challenge the Amount

Demand a complete accounting from the original creditor's last statement through the current claimed balance. Any unauthorized fees, post-charge-off interest, or collection costs not in the original agreement should be disputed line by line.

Nevada Wage Garnishment Exemptions

Greater of 75% of disposable earnings or 50x federal minimum wage exempt. Nevada is more protective than the federal floor.

Nevada Deceptive Trade Practices Act (NRS 598)

In addition to the federal FDCPA, Nevada's Nevada Deceptive Trade Practices Act (NRS 598) may provide additional protections and remedies against Encore Capital Group's collection practices.

Nevada Court System

Small claims limit $10,000. Justice court handles cases up to $15,000. District court for larger amounts. Filing fees in Nevada typically range $50-$300.

What is Encore Capital Group?

Encore Capital Group is the largest publicly traded debt buyer in the U.S. They own LVNV Funding LLC and Midland Credit Management. If you are sued by either, Encore is the parent company.

Has the CFPB taken action against Encore?

Yes. The CFPB has ordered Encore subsidiaries to pay millions in fines and restitution for illegal debt collection practices including suing without proper documentation and collecting on time-barred debts.

Can I sue Encore Capital Group?

You would typically sue the subsidiary that contacted you (LVNV Funding or Midland Credit Management), but in some cases the parent company may also be liable for directing illegal collection practices.

How does Encore get my debt?

Encore purchases portfolios of thousands of defaulted accounts from banks and credit card companies, usually for 3-5 cents per dollar. They then attempt to collect the full original balance plus interest and fees.

How long to respond in Nevada?

21 days from service.

What is the SOL in Nevada?

6 years for written contracts. 4 years for oral contracts.

How protective is Nevada on garnishment?

Nevada exempts the greater of 75% of disposable earnings or 50x minimum wage — more protective than federal law.

Where are cases filed?

Justice court for smaller cases. District court for larger amounts.

Is the collector or debt buyer suing me licensed under NRS Chapter 649?

Most third-party collection agencies and debt buyers that operate in Nevada are required to be licensed by the Nevada Financial Institutions Division under NRS Chapter 649. You can search the FID online licensee list to check current status. If the entity that sent you collection letters or filed suit was not licensed at the relevant time, that is a strong defense and may support a counterclaim. Nevada courts have dismissed collection actions because the plaintiff lacked the required license, and unlicensed collection conduct can also be challenged as a deceptive trade practice under NRS Chapter 598. Even passive debt buyers who hire licensed collection firms have been required to hold their own license depending on the structure of the assignment. Before responding to a Nevada collection lawsuit, the first thing to verify is licensure of every entity in the chain of title, including the original creditor's assignee, the current debt buyer, and the collection law firm itself.

How long does a creditor have to sue me on a debt in Nevada?

Nevada's statute of limitations is six years on written contracts including most credit-card agreements (NRS 11.190(1)(b)) and four years on open accounts and oral contracts (NRS 11.190(2)). The clock generally runs from the date of last payment or default. Once the statute has run, the debt is time-barred and you have a complete defense to a lawsuit, but you must affirmatively raise the limitations defense in your answer. A time-barred debt does not disappear, and a collector may still ask you to pay, but suing or threatening suit on a time-barred debt violates the FDCPA. Be especially careful with partial payments and written acknowledgments on old debts because in some circumstances they can revive or restart the limitations period. If you are unsure of the date of last payment, send a written validation request under the FDCPA and review your credit reports for the original charge-off date as a reference point.

I was sued in Las Vegas Justice Court. What happens if I do not answer?

Las Vegas Justice Court handles a huge volume of collection cases, and the most common way consumers lose is by not answering. If you do not file a written answer within 20 days of being served, the plaintiff can move for default and the court can enter a default judgment for the full amount claimed plus interest and costs. Once a judgment is entered, the collector can garnish wages, levy bank accounts, and place liens on property. The good news is Nevada justice courts allow default judgments to be set aside under Justice Court Rule of Civil Procedure 60, particularly if you act quickly, can show excusable neglect or improper service, and have a meritorious defense such as wrong amount, time-barred debt, lack of standing, or licensure issues. If you have been sued, your single most important step is to file an answer on time, even a short answer that denies the debt and raises common defenses like statute of limitations, lack of standing, and unlicensed collection.

How does Nevada's homestead exemption affect a judgment against me?

Nevada has one of the strongest homestead exemptions in the country. Under NRS 115.010, equity up to $605,000 in your primary residence is protected from most judgment creditors, including credit-card and medical-debt judgment holders. To get the protection in many situations you must record a Declaration of Homestead with the county recorder, which is a simple one-page filing. While the homestead does not prevent a judgment lien from attaching, it protects the exempt equity from forced sale and from being applied to satisfy most civil judgments. The exemption does not protect against mortgages, mechanics' liens, tax liens, or child support, but it does protect against the typical consumer-debt judgment. If you own your home and are facing a Nevada collection lawsuit, recording a homestead declaration before judgment is one of the highest-impact steps you can take to protect your assets, and it costs only a small recording fee.

Can a Nevada collector garnish my Social Security or other federal benefits?

No. Social Security, SSI, VA benefits, federal pensions, and most other federal benefits are exempt from garnishment by private creditors under 42 U.S.C. § 407 and Treasury Rule 31 CFR Part 212. A collector who threatens to take your Social Security to pay a consumer debt is making a misleading statement that violates FDCPA 15 U.S.C. § 1692e. When federal benefits are deposited into your bank account by direct deposit, the bank is required to automatically protect up to two months of those deposits when a garnishment order is received, without requiring you to file anything. To preserve that automatic protection, avoid commingling benefits with significant amounts of other money. If your account is frozen, file an exemption claim immediately and provide proof of the benefit source. Document any collector threats to take exempt funds; that conduct often supports an FDCPA counterclaim with statutory damages up to $1,000 plus attorney fees.