Sued by Portfolio Recovery Associates in Texas? Here's What to Do Next

2015 · consent order

$27M total ($19M consumer refunds + $8M civil penalty)

CFPB found that PRA collected on unsubstantiated debt, filed misleading affidavits in debt-collection lawsuits, misrepresented its intent to prove debts if contested, and sued consumers on time-barred debts.

CFPB source

2023 · consent order

$24M+ total ($12.18M consumer redress + $12M civil penalty)

CFPB found that PRA violated the 2015 order by continuing to collect on unsubstantiated debt, suing without required documentation, suing on time-barred debt, and failing to investigate consumer disputes in its credit reporting.

CFPB source

Statute of Limitations Defense

In Texas, the statute of limitations for credit card debt is 4 years. If your last payment was more than 4 years ago, the debt is time-barred. Portfolio Recovery Associates 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, Portfolio Recovery Associates must prove they actually purchased your specific account. Demand the complete chain of title — the purchase agreement, bill of sale, and assignment documents. In Texas 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.

Texas Debt Collection Act (TDCA) / Texas Deceptive Trade Practices Act (DTPA)

In addition to the federal FDCPA, Texas's Texas Debt Collection Act (TDCA) / Texas Deceptive Trade Practices Act (DTPA) may provide additional protections and remedies against Portfolio Recovery Associates's collection practices.

Texas Court System

Justice court handles cases up to $20,000. County court at law for larger cases. District court for amounts over $200,000. Filing fees in Texas typically range $50-$300.

Who is Portfolio Recovery Associates?

Portfolio Recovery Associates (PRA) is a major debt buyer owned by PRA Group, Inc. They purchase defaulted consumer debts from banks and credit card companies and pursue collection through calls, letters, credit reporting, and lawsuits.

Has PRA been in trouble with regulators?

Yes. In 2015, the CFPB ordered PRA Group to pay $108 million for using litigation tactics that violated the law, including suing consumers without verifying debts and collecting debts that were not owed.

Can I beat a PRA lawsuit?

Yes. Many PRA lawsuits can be successfully defended by challenging their standing to sue, demanding proof of the chain of title, raising statute of limitations defenses, and challenging the accuracy of the amount claimed.

What should I do if PRA contacts me?

Request debt validation in writing within 30 days of their first contact. Do not acknowledge the debt or make any payments, as this could restart the statute of limitations in some states. Consider consulting with a consumer rights attorney.

Can PRA garnish my bank account?

Only after obtaining a court judgment. If PRA sues you and you do not respond, they will get a default judgment that allows wage garnishment and bank levies in most states. Filing your Answer is the critical first step to prevent this.

How long do I have to respond in Texas?

By 10:00 AM on the first Monday after 20 days from service. Effectively about 14-20 days. This is one of the shortest deadlines.

What is the statute of limitations in Texas?

4 years for all types of debt. After 4 years, the debt is time-barred.

Can they garnish my wages in Texas?

No. Texas prohibits wage garnishment for consumer debts. This is one of the strongest protections in the country.

What is the Texas Debt Collection Act?

The TDCA provides additional protections beyond the federal FDCPA. It covers original creditors and third-party collectors and prohibits threats, deception, and unfair practices.

What can a creditor do with a Texas judgment?

While they cannot garnish wages, they can place liens on non-homestead property, levy non-exempt bank funds, and attempt to seize non-exempt assets.

Can a debt collector garnish my wages in Texas?

Generally no. Texas is one of the few states that prohibits wage garnishment for ordinary consumer debts, including credit card debt, medical bills, personal loans, and auto loan deficiencies, under Tex. Const. art. XVI § 28. The only exceptions are child support, court-ordered spousal maintenance, federal and state taxes, federally guaranteed student loans, and certain federal debts where federal law preempts state law. This is true even after a debt collector wins a judgment against you. The judgment can still be used to levy bank accounts (once wages are deposited and lose their character as wages, although Texas courts have generally protected wages even after deposit if traceable), place liens on non-homestead real property, and seize non-exempt personal property. If a debt collector threatens to garnish your wages in Texas, that threat itself can violate both the federal FDCPA and the Texas Debt Collection Act, which can entitle you to damages, attorney fees, and, under the DTPA, treble damages for knowing violations.

Is the debt collector required to be registered in Texas?

Yes. Tex. Fin. Code Ch. 392 requires third-party debt collectors to register with the Texas Secretary of State and post a $10,000 surety bond before collecting consumer debts in Texas. You can search the Secretary of State's database at sos.state.tx.us to verify whether a specific debt collector is registered. If a collector contacting or suing you is not registered and bonded, that itself is a violation of the TDCA and is actionable. Collecting in Texas without registration can also be a criminal misdemeanor under § 392.502. Note that the registration requirement applies to debt collectors as defined in the statute, which is broader than the federal FDCPA in some ways but also has its own exemptions. Original creditors collecting their own debts are not required to register, although they are still subject to most of the substantive prohibitions of the TDCA. A debt buyer that has purchased the account and is now collecting in its own name must register.

What is the statute of limitations on credit card debt in Texas?

Texas's statute of limitations on most consumer debts, including credit card debt, is four years under Tex. Civ. Prac. & Rem. Code § 16.004. The clock generally starts on the date of the first missed payment that was never cured, often referred to as the date of default. Under Tex. Fin. Code § 392.307, debt buyers are statutorily prohibited from suing or threatening to sue on debts past the limitations period, and any payment, written promise, or new agreement made after the limitations expires does not restart the clock. This is one of the strongest anti-zombie-debt provisions in the country. If you are sued on a debt that is past four years old measured from default, you should raise statute of limitations as an affirmative defense in your answer. The defense is waived if not raised. Texas also requires debt buyers to provide specific disclosures in court filings about the chain of title to the debt under § 392.307.

Can a debt collector take my house in Texas?

Almost never. Texas has one of the most powerful homestead exemptions in the country under Tex. Prop. Code § 41.001. Your primary residence is exempt from forced sale by general unsecured creditors, with no dollar cap, up to 10 acres in an urban setting or 100 acres rural for a single adult, and up to 200 acres rural for a family. This means a debt buyer who wins a credit card or medical debt judgment against you generally cannot force a sale of your home. The homestead exemption does not apply to certain debts secured by the home itself, including mortgages, home equity loans authorized by Tex. Const. art. XVI § 50, mechanic's and materialman's liens for work on the home, and property taxes. A judgment can still attach as a lien on non-homestead property like a vacation home or rental, and the judgment creditor can renew the judgment every ten years under Tex. Civ. Prac. & Rem. Code § 34.001.

I was sued in justice court in Texas. What do I do?

Justice court, sometimes called JP court, handles civil cases up to $20,000 in Texas under Tex. Gov't Code § 27.031. The summons (citation) will tell you the deadline to answer, which is typically 14 days from service in justice court under the Texas Rules of Civil Procedure for Justice Courts. File a written answer with the clerk by that deadline. The answer can be simple, denying the allegations and listing defenses such as lack of standing, statute of limitations, improper venue, failure to attach the contract, and noncompliance with the Texas Debt Collection Act including failure to register. Send a copy to the plaintiff's attorney. Justice court rules are more relaxed than district court, but you can still serve written discovery requests for documents like the original credit agreement, the bill of sale, and the chain of assignments. Many debt buyer cases collapse in justice court when the plaintiff cannot produce these records. Show up to every setting; default judgments are common against no-shows.