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Debt Assignment: How They Work, Considerations and Benefits

Daniel Liberto is a journalist with over 10 years of experience working with publications such as the Financial Times, The Independent, and Investors Chronicle.

Charlene Rhinehart is a CPA , CFE, chair of an Illinois CPA Society committee, and has a degree in accounting and finance from DePaul University.

Katrina Ávila Munichiello is an experienced editor, writer, fact-checker, and proofreader with more than fourteen years of experience working with print and online publications.

Investopedia / Ryan Oakley

What Is Debt Assignment?

The term debt assignment refers to a transfer of debt , and all the associated rights and obligations, from a creditor to a third party. The assignment is a legal transfer to the other party, who then becomes the owner of the debt. In most cases, a debt assignment is issued to a debt collector who then assumes responsibility to collect the debt.

Key Takeaways

Debt assignment is a transfer of debt, and all the associated rights and obligations, from a creditor to a third party (often a debt collector).
The company assigning the debt may do so to improve its liquidity and/or to reduce its risk exposure.
The debtor must be notified when a debt is assigned so they know who to make payments to and where to send them.
Third-party debt collectors are subject to the Fair Debt Collection Practices Act (FDCPA), a federal law overseen by the Federal Trade Commission (FTC).

How Debt Assignments Work

When a creditor lends an individual or business money, it does so with the confidence that the capital it lends out—as well as the interest payments charged for the privilege—is repaid in a timely fashion. The lender , or the extender of credit , will wait to recoup all the money owed according to the conditions and timeframe laid out in the contract.

In certain circumstances, the lender may decide it no longer wants to be responsible for servicing the loan and opt to sell the debt to a third party instead. Should that happen, a Notice of Assignment (NOA) is sent out to the debtor , the recipient of the loan, informing them that somebody else is now responsible for collecting any outstanding amount. This is referred to as a debt assignment.

The debtor must be notified when a debt is assigned to a third party so that they know who to make payments to and where to send them. If the debtor sends payments to the old creditor after the debt has been assigned, it is likely that the payments will not be accepted. This could cause the debtor to unintentionally default.

When a debtor receives such a notice, it's also generally a good idea for them to verify that the new creditor has recorded the correct total balance and monthly payment for the debt owed. In some cases, the new owner of the debt might even want to propose changes to the original terms of the loan. Should this path be pursued, the creditor is obligated to immediately notify the debtor and give them adequate time to respond.

The debtor still maintains the same legal rights and protections held with the original creditor after a debt assignment.

Special Considerations

Third-party debt collectors are subject to the Fair Debt Collection Practices Act (FDCPA). The FDCPA, a federal law overseen by the Federal Trade Commission (FTC), restricts the means and methods by which third-party debt collectors can contact debtors, the time of day they can make contact, and the number of times they are allowed to call debtors.

If the FDCPA is violated, a debtor may be able to file suit against the debt collection company and the individual debt collector for damages and attorney fees within one year. The terms of the FDCPA are available for review on the FTC's website .

Benefits of Debt Assignment

There are several reasons why a creditor may decide to assign its debt to someone else. This option is often exercised to improve liquidity and/or to reduce risk exposure. A lender may be urgently in need of a quick injection of capital. Alternatively, it might have accumulated lots of high-risk loans and be wary that many of them could default . In cases like these, creditors may be willing to get rid of them swiftly for pennies on the dollar if it means improving their financial outlook and appeasing worried investors. At other times, the creditor may decide the debt is too old to waste its resources on collections, or selling or assigning it to a third party to pick up the collection activity. In these instances, a company would not assign their debt to a third party.

Criticism of Debt Assignment

The process of assigning debt has drawn a fair bit of criticism, especially over the past few decades. Debt buyers have been accused of engaging in all kinds of unethical practices to get paid, including issuing threats and regularly harassing debtors. In some cases, they have also been charged with chasing up debts that have already been settled.

Federal Trade Commission. " Fair Debt Collection Practices Act ." Accessed June 29, 2021.

Federal Trade Commission. " Debt Collection FAQs ." Accessed June 29, 2021.

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Assignment Of Debt

Jump to section, what is an assignment of debt.

Assignment of debt is an agreement that transfer debt, rights, and obligations from a creditor to a third party. Assignment of debt agreements are commonly found when a creditor issues past due debt to a debt collection agency. The original lender will be relieved of all obligations and the agency will become the new owner of the debt. Debt assignment allows creditors to improve liquidity by reducing their financial risk. If a creditor has taken on a large amount of unsecured debt, an assignment of debt agreement is a quick way to transfer some of the unsecured loans to another party.

Common Sections in Assignments Of Debt

Below is a list of common sections included in Assignments Of Debt. These sections are linked to the below sample agreement for you to explore.

Assignment Of Debt Sample

Reference : Security Exchange Commission - Edgar Database, EX-10 19 ex107.htm ASSIGNMENT OF DEBT AND SECURITY , Viewed October 25, 2021, View Source on SEC .

Who Helps With Assignments Of Debt?

Lawyers with backgrounds working on assignments of debt work with clients to help. Do you need help with an assignment of debt?

Post a project in ContractsCounsel's marketplace to get free bids from lawyers to draft, review, or negotiate assignments of debt. All lawyers are vetted by our team and peer reviewed by our customers for you to explore before hiring.

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Meet some of our Assignment Of Debt Lawyers

Brian C. Restivo, the managing member of Restivo Legal, PLLC, has been licensed by the State Bar of Texas and continuously practicing as an attorney since November of 2000. Over these years, he has represented customers across the spectrum - from a Fortune 500 company to individuals - and is seasoned at tailoring his services to the unique needs of each customer.

Antonella C.

I am a business transactional & trademark attorney with 15 years experience in the law firm and in-house settings. I am barred in Pennsylvania and New Jersey. I currently own my own practice serving businesses and entrepreneurs with business transactional and IP law.

Background in Engineering, Masters in Business, Licensed Patent Attorney. Reviewed countless title reports, and land contracts. If you have a problem with Real Estate I can solve it.

I have been in business development for 15 years before becoming an attorney. As an attorney, I help companies navigate legal challenges that they face.

Anthony M. Verna III, is the managing partner at Verna Law, P.C. With a strong focus on Trademark, Copyright, Domain Names, Entertainment, and Advertising law, Verna Law, P.C. strives to provide all Intellectual Property services a modern business of any size may need to market and promote itself better. From the very early concept stage, Verna Law, P.C. can conduct a comprehensive, all-encompassing search and analysis on any proposed trademark to head off complications. Once the proposed concept enters the Alpha stage, Verna Law, P.C. can seamlessly switch to handling registration, protection, and if needed, defense of registered trademarks, copyrights, and domain names, as well as prosecution of entities violating said rights. Verna Law, P.C. also provides intellectual property counseling and services tailored to fit into your business’ comprehensive growth strategy. This shows as many of Verna Law, P.C.’s clients are international: from China, the United Kingdom, Canada, and Germany, Verna Law’s reach is worldwide. Additionally, Verna Law, P.C., can handle your business’ Entertainment and Advertising law needs by helping your business create advertising and promotions that keep competitors and regulators at bay. Located in the shadow of New York City, Verna Law, P.C. has a global reach that will provide clients with the most vigorous Intellectual Property advocate available. Anthony M. Verna III is a member of the New York and New Jersey Bars, as well as the U.S. District Court Southern District of New York. He is a sought-after business speaker, including regular appearances at the World Board Gaming Championships, Business Marketing Association of New Jersey, and Columbian Lawyers Association.

I am an experienced New York Attorney pleased to offer my services to clients who are seeking assistance with startup consulting and/or business related legal work. My expertise in both of these areas allows me to provide comprehensive legal support to entrepreneurs and businesses of all sizes.

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Understanding an assignment and assumption agreement

Need to assign your rights and duties under a contract? Learn more about the basics of an assignment and assumption agreement.

Get your assignment of agreement

by Belle Wong, J.D.

Belle Wong, is a freelance writer specializing in small business, personal finance, banking, and tech/SAAS. She ...

The assignment and assumption agreement

The basics of assignment and assumption, filling in the assignment and assumption agreement.

While every business should try its best to meet its contractual obligations, changes in circumstance can happen that could necessitate transferring your rights and duties under a contract to another party who would be better able to meet those obligations.

Person presenting documents to another person who is signing them

If you find yourself in such a situation, and your contract provides for the possibility of assignment, an assignment and assumption agreement can be a good option for preserving your relationship with the party you initially contracted with, while at the same time enabling you to pass on your contractual rights and duties to a third party.

An assignment and assumption agreement is used after a contract is signed, in order to transfer one of the contracting party's rights and obligations to a third party who was not originally a party to the contract. The party making the assignment is called the assignor, while the third party accepting the assignment is known as the assignee.

In order for an assignment and assumption agreement to be valid, the following criteria need to be met:

The initial contract must provide for the possibility of assignment by one of the initial contracting parties.
The assignor must agree to assign their rights and duties under the contract to the assignee.
The assignee must agree to accept, or "assume," those contractual rights and duties.
The other party to the initial contract must consent to the transfer of rights and obligations to the assignee.

A standard assignment and assumption contract is often a good starting point if you need to enter into an assignment and assumption agreement. However, for more complex situations, such as an assignment and amendment agreement in which several of the initial contract terms will be modified, or where only some, but not all, rights and duties will be assigned, it's a good idea to retain the services of an attorney who can help you draft an agreement that will meet all your needs.

When you're ready to enter into an assignment and assumption agreement, it's a good idea to have a firm grasp of the basics of assignment:

First, carefully read and understand the assignment and assumption provision in the initial contract. Contracts vary widely in their language on this topic, and each contract will have specific criteria that must be met in order for a valid assignment of rights to take place.
All parties to the agreement should carefully review the document to make sure they each know what they're agreeing to, and to help ensure that all important terms and conditions have been addressed in the agreement.
Until the agreement is signed by all the parties involved, the assignor will still be obligated for all responsibilities stated in the initial contract. If you are the assignor, you need to ensure that you continue with business as usual until the assignment and assumption agreement has been properly executed.

Unless you're dealing with a complex assignment situation, working with a template often is a good way to begin drafting an assignment and assumption agreement that will meet your needs. Generally speaking, your agreement should include the following information:

Identification of the existing agreement, including details such as the date it was signed and the parties involved, and the parties' rights to assign under this initial agreement
The effective date of the assignment and assumption agreement
Identification of the party making the assignment (the assignor), and a statement of their desire to assign their rights under the initial contract
Identification of the third party accepting the assignment (the assignee), and a statement of their acceptance of the assignment
Identification of the other initial party to the contract, and a statement of their consent to the assignment and assumption agreement
A section stating that the initial contract is continued; meaning, that, other than the change to the parties involved, all terms and conditions in the original contract stay the same

In addition to these sections that are specific to an assignment and assumption agreement, your contract should also include standard contract language, such as clauses about indemnification, future amendments, and governing law.

Sometimes circumstances change, and as a business owner you may find yourself needing to assign your rights and duties under a contract to another party. A properly drafted assignment and assumption agreement can help you make the transfer smoothly while, at the same time, preserving the cordiality of your initial business relationship under the original contract.

Assignment Agreement Template

Use our assignment agreement to transfer contractual obligations.

Updated February 1, 2024 Reviewed by Brooke Davis

An assignment agreement is a legal document that transfers rights, responsibilities, and benefits from one party (the “assignor”) to another (the “assignee”). You can use it to reassign debt, real estate, intellectual property, leases, insurance policies, and government contracts.

What Is an Assignment Agreement?

What to include in an assignment agreement, how to assign a contract, how to write an assignment agreement, assignment agreement sample.

Partnership Interest

An assignment agreement effectively transfers the rights and obligations of a person or entity under an initial contract to another. The original party is the assignor, and the assignee takes on the contract’s duties and benefits.

It’s often a requirement to let the other party in the original deal know the contract is being transferred. It’s essential to create this form thoughtfully, as a poorly written assignment agreement may leave the assignor obligated to certain aspects of the deal.

The most common use of an assignment agreement occurs when the assignor no longer can or wants to continue with a contract. Instead of leaving the initial party or breaking the agreement, the assignor can transfer the contract to another individual or entity.

For example, imagine a small residential trash collection service plans to close its operations. Before it closes, the business brokers a deal to send its accounts to a curbside pickup company providing similar services. After notifying account holders, the latter company continues the service while receiving payment.

Create a thorough assignment agreement by including the following information:

Effective Date: The document must indicate when the transfer of rights and obligations occurs.
Parties: Include the full name and address of the assignor, assignee, and obligor (if required).
Assignment: Provide details that identify the original contract being assigned.
Third-Party Approval: If the initial contract requires the approval of the obligor, note the date the approval was received.
Signatures: Both parties must sign and date the printed assignment contract template once completed. If a notary is required, wait until you are in the presence of the official and present identification before signing. Failure to do so may result in having to redo the assignment contract.

Review the Contract Terms

Carefully review the terms of the existing contract. Some contracts may have specific provisions regarding assignment. Check for any restrictions or requirements related to assigning the contract.

Check for Anti-Assignment Clauses

Some contracts include anti-assignment clauses that prohibit or restrict the ability to assign the contract without the consent of the other party. If there’s such a clause, you may need the consent of the original parties to proceed.

Determine Assignability

Ensure that the contract is assignable. Some contracts, especially those involving personal services or unique skills, may not be assignable without the other party’s agreement.

Get Consent from the Other Party (if Required)

If the contract includes an anti-assignment clause or requires consent for assignment, seek written consent from the other party. This can often be done through a formal amendment to the contract.

Prepare an Assignment Agreement

Draft an assignment agreement that clearly outlines the transfer of rights and obligations from the assignor (the party assigning the contract) to the assignee (the party receiving the assignment). Include details such as the names of the parties, the effective date of the assignment, and the specific rights and obligations being transferred.

Include Original Contract Information

Attach a copy of the original contract or reference its key terms in the assignment agreement. This helps in clearly identifying the contract being assigned.

Execution of the Assignment Agreement

Both the assignor and assignee should sign the assignment agreement. Signatures should be notarized if required by the contract or local laws.

Notice to the Other Party

Provide notice of the assignment to the non-assigning party. This can be done formally through a letter or as specified in the contract.

File the Assignment

File the assignment agreement with the appropriate parties or entities as required. This may include filing with the original contracting party or relevant government authorities.

Communicate with Third Parties

Inform any relevant third parties, such as suppliers, customers, or service providers, about the assignment to ensure a smooth transition.

Keep Copies for Records

Keep copies of the assignment agreement, original contract, and any related communications for your records.

Here’s a list of steps on how to write an assignment agreement:

Step 1 – List the Assignor’s and Assignee’s Details

List all of the pertinent information regarding the parties involved in the transfer. This information includes their full names, addresses, phone numbers, and other relevant contact information.

This step clarifies who’s transferring the initial contract and who will take on its responsibilities.

Step 2 – Provide Original Contract Information

Describing and identifying the contract that is effectively being reassigned is essential. This step avoids any confusion after the transfer has been completed.

Step 3 – State the Consideration

Provide accurate information regarding the amount the assignee pays to assume the contract. This figure should include taxes and any relevant peripheral expenses. If the assignee will pay the consideration over a period, indicate the method and installments.

Step 4 – Provide Any Terms and Conditions

The terms and conditions of any agreement are crucial to a smooth transaction. You must cover issues such as dispute resolution, governing law, obligor approval, and any relevant clauses.

Step 5 – Obtain Signatures

Both parties must sign the agreement to ensure it is legally binding and that they have read and understood the contract. If a notary is required, wait to sign off in their presence.

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Insights & events

Assigning debts and other contractual claims - not as easy as first thought

Updates to UK Money laundering rules - key changes

Harking back to law school, we had a thirst for new black letter law. Section 136 of the Law of the Property Act 1925 kindly obliged. This lays down the conditions which need to be satisfied for an effective legal assignment of a chose in action (such as a debt). We won’t bore you with the detail, but suffice to say that what’s important is that a legal assignment must be in writing and signed by the assignor, must be absolute (i.e. no conditions attached) and crucially that written notice of the assignment must be given to the debtor.

When assigning debts, it’s worth remembering that you can’t legally assign part of a debt – any attempt to do so will take effect as an equitable assignment. The main practical difference between a legal and an equitable assignment is that the assignor will need to be joined in any legal proceedings in relation to the assigned debt (e.g. an attempt to recover that part of the debt).

Recent cases which tell another story

Why bother telling you the above? Aside from our delight in remembering the joys of debating the merits of legal and equitable assignments (ehem), it’s worth revisiting our textbooks in the context of three recent cases. Although at first blush the statutory conditions for a legal assignment seem quite straightforward, attempts to assign contractual claims such as debts continue to throw up legal disputes:

In Sumitomo Mitsui Banking Corp Europe Ltd v Euler Hermes Europe SA (NV) [2019] EWHC 2250 (Comm), the High Court held that a performance bond issued under a construction contract was not effectively assigned despite the surety acknowledging a notice of assignment of the bond. Sadly, the notice of assignment failed to meet the requirements under the bond instrument that the assignee confirm its acceptance of a provision in the bond that required the employer to repay the surety in the event of an overpayment. This case highlights the importance of ensuring any purported assignment meets any conditions stipulated in the underlying documents.
In Promontoria (Henrico) Ltd v Melton [2019] EWHC 2243 (Ch) (26 June 2019) , the High Court held that an assignment of a facility agreement and legal charges was valid, even though the debt assigned had to be identified by considering external evidence. The deed of assignment in question listed the assets subject to assignment, but was illegible to the extent that the debtor’s name could not be deciphered. The court got comfortable that there had been an effective assignment, given the following factors: (i) the lender had notified the borrower of its intention to assign the loan to the assignee; (ii) following the assignment, the lender had made no demand for repayment; (iii) a manager of the assignee had given a statement that the loan had been assigned and the borrower had accepted in evidence that he was aware of the assignment. Fortunately for the assignee, a second notice of assignment - which was invalid because it contained an incorrect date of assignment - did not invalidate the earlier assignment, which was found to be effective. The court took a practical and commercial view of the circumstances, although we recommend ensuring that your assignment documents clearly reflect what the parties intend!
Finally, in Nicoll v Promontoria (Ram 2) Ltd [2019] EWHC 2410 (Ch), the High Court held that a notice of assignment of a debt given to a debtor was valid, even though the effective date of assignment stated in the notice could not be verified by the debtor. The case concerned a debt assigned by the Co-op Bank to Promontoria and a joint notice given by assignor and assignee to the debtor that the debt had been assigned “on and with effect from 29 July 2016”. A subsequent statutory demand served by Promontoria on the debtor for the outstanding sums was disputed on the basis that the notice of assignment was invalid because it contained an incorrect date of assignment. Whilst accepting that the documentation was incapable of verifying with certainty the date of assignment, the Court held that the joint notice clearly showed that both parties had agreed that an assignment had taken place and was valid. This decision suggests that mistakes as to the date of assignment in a notice of assignment may not necessarily be fatal, if it is otherwise clear that the debt has been assigned.

The conclusion from the above? Maybe it’s not quite as easy as first thought to get an assignment right. Make sure you follow all of the conditions for a legal assignment according to the underlying contract and ensure your assignment documentation is clear.

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What is an Assignment of Debt?

By Vanessa Swain Senior Lawyer

Updated on February 22, 2023 Reading time: 5 minutes

This article meets our strict editorial principles. Our lawyers, experienced writers and legally trained editorial team put every effort into ensuring the information published on our website is accurate. We encourage you to seek independent legal advice. Learn more .

Perfecting Assignment

Enforcing an Assigned Debt

Recovery of an Assigned Debt

Other Considerations

Key Takeaways

Frequently asked questions.

I t is common for creditors, such as banks and other financiers, to assign their debt to a third party. Usually, an assig nment of debt is done in an effort to minimise the costs of recovery where a debtor has been delinquent for some time. This article looks at:

what it means to ‘assign a debt’;
the legal requirements to perfecting an assignment; and
common problems with enforcing an assigned debt.

Whether you’re a small business owner or the Chief Financial Officer of an ASX-listed company, one fact remains: your customers need to pay you.

This manual aims to help business owners, financial controllers and credit managers best manage and recover their debt.

An assignment of debt, in simple terms, is an agreement that transfers a debt owed to one entity, to another. A creditor does not need the consent of the debtor to assign a debt.

Once a debt is properly assigned, all rights and responsibilities of the original creditor (the assignor ) transfer to the new owner (the assignee ). Once an assignment of debt has been perfected, the assignee can collect the full amount of the debt owed . This includes interest recoverable under the original contract, as if they were the original creditor. A debtor is still responsible for paying the outstanding debt after an assignment. However, now, the debt or must pay the debt to the assignee rather than the original creditor.

Purchasing debt can be a lucrative business. Creditors will generally sell debt at a loss, for example, 20c for each dollar owed. Although, the amount paid will vary depending on factors such as the age of the debt and the likelihood of recovery. This can be a tax write off for the assignor, while the assignee can take steps to recover 100% of the debt owed.

In New South Wales, the requirements for a legally binding assignment of debt are set out in the Conveyancing Act :

the assignment must be in writing. You do this in the form of a deed (deed of assignment) and both the assignor and assignee sign it; and
the assignor must provide notice to the debtor. The requirement for notice must be express and must be in writing. The assignor must notify the debtor advising them of the debt’ s assign ment and to who it has been assigned. The assignee will send a separate notice to the debtor, putting them on notice that the debt is due and payable. They will also provide them with the necessary information to make payment.

The assignor must send the notices to the debtor’s last known address.

Debtor as a Joined Party

In some circumstances, a debtor will be joined as a party to the deed of assignment . There can be a great benefit in this approach . This is because the debtor can provide warranties that the debt is owed and has clear notice of the assignment. However, it is not always practical to do so for a few reasons:

a debtor may not be on speaking terms with the assignor;
a debtor may not be prepared to co-operate or provide appropriate warranties; and
the assignor or the assignee may not want the debtor to be made aware of the sale price . This occurs particularly where the sale price is at a significant discount.

If the debtor is not a party to the deed of assignment, proper notice of the assignment must be provided.

An assignment of debt that has not been properly perfected will not constitute a legal debt owing to the assignee. Rather, the legal right to recover the debt will remain with the assignor. Only an equitable interest in the debt will transfer to the assignee.

Enforcing an Assigned Debt

After validly assigning a debt (in writing and notice has been provided to the debtor’s last known place of residence), the assignee is entitled to take any legal steps available to them to recover the outstanding debt. These recovery options include:

commencing court proceedings;
obtaining a judgment; and
enforcement of that judgment.

Suppose court proceedings have been commenced or judgment already entered in favour of the assignor. In that case, the assignee must take steps to have the proceedings or judgment formally changed into the assignee’s name.

In our experience, recovery of an assigned debt can be problematic because:

debtors often do not understand the concept of debt assignment and may not be aware that their credit contract contains an assignment of debt clause;
disputes can arise as to whether a lawful assignment of debt has arisen. A debtor may claim that the assignor did not provide them with the requisite notice of the assignment, or in some cases, a contract will specifically exclude the creditor from legally assigning a debt;
proper records of the notice of assignment provided to the debtor must be maintained. If proper records have not been kept, it may be difficult to prove that notice has been properly given, which may invalidate the legal assignment; and
the debtor has the right to make an offsetting claim in defence to any recovery action taken by the assignee. A debtor may raise an offsetting claim which has arisen out of a previous arrangement with the assignor (which the assignee may not be aware of). For example, the debtor may have entered into an agreement with the assignor whereby the assignor agreed to accept a lesser amount of the debt owed by way of settlement. Because the assignee acquires the same rights and obligations of the assignor, the terms of that previous settlement agreement will bind the assignee. The court may find that there is no debt owing by the debtor. In this case, the assignee will have been assigned nothing of value.

Other Considerations

When assigning a debt, it is essential that the assignee, in particular, considers relevant statutory limitation periods for commencing proceedings or enforcing a judgment debt . In New South Wales, the time limit:

to file legal proceedings to recover debts is six years from the date of last payment or when the debtor admitted in writing that they owed the debt; and
for enforcing a judgment debt is 12 years from the date of judgment.

An assignment of a debt does not extend these limitation periods.

While there can be benefits to both the assignor and the assignee, an assignment of debt will be unenforceable if done incorrectly. Therefore, if you are considering assigning or being assigned a debt, it is important to seek legal advice. If you need help with drafting or reviewing a deed of assignment or wish to recover a debt that has been assigned to you, contact LegalVision’s debt recovery lawyers on 1300 544 755 or fill out the form on this page.

An assignment of debt is an agreement that transfers a debt owed to one entity, to another. A creditor does not need the consent of the debtor to assign a debt.

Once the assignee has validly assigned a debt, they are entitled to take any legal steps available to them to recover the outstanding debt. This includes commencing court proceedings, obtaining a judgment and enforcement of that judgment.

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How Does Debt Assignment Work?

Chloe Meltzer | December 07, 2023

Legal Expert Chloe Meltzer, MA

Chloe Meltzer is an experienced content writer specializing in legal content creation. She holds a degree in English Literature from Arizona State University, complemented by a Master’s in Marketing from California Polytechnic State University-San Luis Obispo.

Edited by Hannah Locklear

Editor at SoloSuit Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: What are your options when your debt has been assigned to a debt collector? Find out why a creditor might have assigned your debt and how to deal with it.

Debt assignment refers to a transfer of debt. This includes all of the associated rights and obligations, as it goes from a creditor to a third party. Debt assignment is essentially the legal transfer of debt to a debt collector (or debt collection agency). After this agency purchases the debt, they will have the responsibility to collect the debt, meaning you will pay your debt to them.

File a response with SoloSuit to win against debt collectors.

Find Out How Debt Assignment Works

When a creditor or lender no longer wants to be responsible for attempting to collect your debt, they will sell your debt to a third party. When this occurs, a Notice of Assignment (NOA) is sent out to you. This should inform you of who is responsible for collecting the rest of your loan or debt.

Legally you must be notified if your debt is assigned to someone new. This is to ensure that you know where to make payments to. If you are not aware of the new assignment, you may send payments to the wrong location which could force you into unintentional default.

Know How the FDCPA Protects You

Third-party debt collectors must act according to the Fair Debt Collection Practices Act (FDCPA). This federal law restricts the methods by which a debt collector can contact you, and attempt to collect debts. The FDCPA regulates the time of day or night a collector can make contact, how often they can call, as well as what they say and how they say it.

If you believe that a debt collector has violated the FDCPA, then you may be able to file a suit against that company. You may also be able to sue for damages or attorney fees.

Stand up to debt collection agencies with SoloSuit.

Learn Why a Creditor Assigns Debt

There are a few reasons why a creditor may assign your debt. Typically, the most common reason is to reduce their risk. By assigning and selling the debt it is no longer their liability. They can ensure they recoup some of their money, and appease investors as well.

Discover How Purchasing a Debt Differs from Debt Assignment

The purchase of debt occurs before assignment. Before the assignment of delinquent debt, a collection agency will be required to purchase it. This is often done at a far lower price, while they still attempt to recoup the entire debt. Because of this, it allows you to attempt to settle your debt for less.

Understand Why Debt Assignment Is Often Criticized

The process of assigning debt is often seen as unethical. With threats, harassment, and lies of all kinds, many debt buyers have been accused of violating the FDCPA. Because of this, debt assignment has seen a good amount of criticism. Some cases have even seen consumers charged with debts that have already been settled or paid .

Nevertheless, this shows how important it is to be on top of your debts. The number one choice you should make with any debt or debt assignment is to respond to all correspondence. This will ensure that you stay in compliance, and act when you need to.

What is SoloSuit?

SoloSuit makes it easy to respond to a debt collection lawsuit.

How it works: SoloSuit is a step-by-step web-app that asks you all the necessary questions to complete your answer. Upon completion, you can either print the completed forms and mail in the hard copies to the courts or you can pay SoloSuit to file it for you and to have an attorney review the document.

Respond with SoloSuit

"First time getting sued by a debt collector and I was searching all over YouTube and ran across SoloSuit, so I decided to buy their services with their attorney reviewed documentation which cost extra but it was well worth it! SoloSuit sent the documentation to the parties and to the court which saved me time from having to go to court and in a few weeks the case got dismissed!" – James

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

>>Read the NPR story on SoloSuit: A Student Solution To Give Utah Debtors A Fighting Chance

How to Answer a Summons for debt collection in all 50 states

Here's a list of guides on how to respond to a debt collection lawsuit in each state:

The Ultimate 50 State Guide

Connecticut
Massachusetts
Mississippi
New Hampshire
North Carolina
North Dakota
Pennsylvania
Rhode Island
South Carolina
South Dakota
Vermont ; Vermont (Small Claims court)
West Virginia

Guides on how to resolve debt with every debt collector

Are you being sued by a debt collector? We’re making guides on how to resolve debt with each one.

11 Charter Communications
AAA Collections
Aargon Agency Inc
Absolute Resolutions Investments LLC
ACEI Collections
Account Services
Accredited Collection Services
Advanced Recovery Systems
AFNI Collections
Alco Capital Group LLC
Aldous and Associates
Alliance Collections
Alliance One
Alliant Capital Management
Alpha Recovery Corp
Alltran Financial
Alltran Health
Alorica Inc.
Amcol Clmbia in Court
American Coradius International
American Profit Recovery
American Recovery Service
Americollect
AmSher Collection Services
Apelles LLC
AR Resources
ARC Collections
ARM Solutions
Arrow Financial Services
ARS National Services
ARSC Debt Collectors
AscensionPoint Recovery Services
Asset Acceptance LLC
Asset Recovery Solutions
Associated Credit Services
Atlantic Credit and Finance
Atradius Collections
Automated Collection Services, Inc.
Autovest LLC
AWA Collections
Balekian Hayes
Bay Area Receivables
BCA Financial Services
BC Services
Benuck and Rainey
Berlin-Wheeler
Bluebonnet Financial LLC
Bonneville Collections
Bull City Financial
Bureaus Investment Group
Caine and Weiner
Capio Partners
Capital Accounts
Capital Collections
Capital Management Services
Carmel Financial/New Coast Direct
Cavalry SPV I LLC
CBCS Collections
CBV Collections
CCB Credit Services
CCS Collections
CCS Offices
Central Mediation Services
Central Portfolio Control
Cerastes LLC
Choice Recovery
Choice Recovery Inc
CKS Financial
CKMS Financial
Client Services
CMRE Financial Services
Coast Professional
Comenity Bank Debt Collection
Commonwealth Financial
ConServe Debt Collection
Consumer Collection Management
Contract Callers Inc
Convergent Healthcare Recoveries
Convergent Outsourcing
Couch Conville & Blitt
Covington Credit
Credco in Court
Credence Resource Management
Credit Bureau Systems
Credit Control Corporation
Credit Management Company
Credit Management LP
Credit Systems
CTC Debt Collector
CVCS Debt Collection
Cypress Financial Recoveries
D&A Services
Daniels, Norelli, Cecere & Tavel P.C.
DCM Services
Debt Recovery Solutions
Delanor Kemper & Associates
Department Stores National Bank
Direct Recovery Associates
Discover Collections
Diversified Adjustment
Diversified Consultants
Diversified Recovery Bureau
DNF Associates, LLC
Dynamic Collectors
Eagle Accounts Group, Inc.
Eastern Account System
Ellington and Associates Collections
Encore Capital Group
Enerson Law
Enerson Law LLC
Enhanced Recovery Company
ERC Collections
ERSolutions
Estate Information Services
Equable Ascent Financial
Everest Business Funding
Executive Credit Management
Faber and Brand
Factual Data
Falls Collection Service
FCO Collections and Outsourcing
FIA Card Services
fin rec svc (Financial Recovery Services)
First Federal Credit Credit Control
First Financial Bank
First Portfolio Ventures LLC
First Progress
FirstPoint Collection Resources
Firstsource Advantage
FMA Alliance
Forster & Garbus
Franklin Collection Services
Freedom Plus
Freshview Solutions
Frontline Asset
Frost Arnett
Fulton Friedman & Gullace LLP
Galaxy International Purchasing, LLC
GC Debt Collection
GC Services
General Revenue Corporation
GLA Collections
Glass Mountain Capital
Glasser and Glasser
Global Credit Collection Corp
Global Trust Management
GMAC Financing
Golden 1 Credit Union
Grant and Weber
Grant Mercantile Agency
Gulf Coast Collection Bureau
Halsted Financial Services
Harris and Harris
Harvard Collection
Harvest Credit Management
Helvey and Associates
Hollis Cobb
Holloway Moxley
Hosto Buchan
Howard Lee Schiff
H&R Accounts
Hudson & Keyse LLC?
Hunter Warfield
Impact Receivables Management
Innovative Recovery
Integras Capital Recovery LLC
Javitch Block
JHPDE Finance 1 LLC
JP Receivables Management Partners
Kenneth Eisen and Associates
KeyBank student loans
Kirschenbaum, Phillips & Levy P.C.
KLS Financial Services
Kramer & Frank
Lakeside Collection
Lending Club
Lincoln and Morgan Kabbage
Linebarger Goggan Blair & Sampson LLP
Lockhart Collection Agency
LJ Ross Associates
LTD Collections
Malcolm S. Gerald and Associates
Malen & Associates
Mandarich Law Group
Mannbracken
Marcam Associates
MARS Inc. Collections
MCA Management Company
McCarthy, Burgess & Wolff
Meade & Associates
Mercantile Adjustment Bureau
Merchants Credit Association
MGM Collections
Michael J Adams PC
Midland Funding LLC
Mid-South Adjustment
Monarch Recovery
Monterey Financial
Moss Law Firm
Mountain Land Collections
MRS Associates
MSW Capital LLC
Mullooly, Jeffrey, Rooney & Flynn
Nathan and Nathan PC
National Collegiate Trust
National Credit Adjusters
National Credit Care
National Credit Systems
National Enterprise Systems
National Recovery Agency
National Recovery Solutions
Nationwide Credit
Nationwide Recovery Services
Nationwide Recovery Systems
NCO Financial Systems Incorporated
North American Recovery
Northland Group
Northstar Capital Acquisition
Northstar Location Services
NRC Collection Agency
Oliver Adjustment Company
Oliphant Financial, LLC
P&B Capital Group
PCB Collections Agency
Palisades Collection LLC
Pallida LLC
Paragon Contracting Services
Paragon Revenue Group
Payday Loan Debt Collectors
Pendrick Capital Partners
Penn Credit
Perdue Brandon
Persolve LLC
Phillips & Cohen Associates
Phoenix Financial Services
Pioneer Credit Recovery
PRA Group, Inc.
Pressler, Felt & Warshaw LLP
Prestige Services, Inc.
Prince Parker and Associates
Professional Finance Company
Progressive Management Systems
Provest Law
Quaternary Collection Agency
RAB Collection Agency
Rash Curtis and Associates
Radius Global SOL
Radius Global Solutions
Rawlings Company
Razor Capital
Real Time Resolutions
Receivables Performance Management
Regents and Associates
Reliant Capital Solutions
Resurgent Capital Services and LVNV Funding
Revco Solutions
Revenue Enterprises LLC
Revenue Group
RGS Financial, Inc.
RMP LLC in Court
RMP Services
RS Clark and Associates
RTR Financial Services
Rubin & Rothman
Salander Enterprises LLC
Samara Portfolio Management
SCA Collections
Scott Parnell and Associates
Second Round Collections
Second Round Sub LLC
Selip & Stylianou LLP
Sequium Asset Solutions
Sessoms and Rogers
Sherman Acquisition
Sherman Financial Group
SIMM Associates
Source Receivables Management
Southern Management Systems
Southwest Credit Group
Spire Recovery Solutions
SRS Company
Stark Collection Agency
State Collection Service
Stenger and Stenger
Stillman Law Office
Summit Account Resolution
Sunrise Credit Services
Superlative RM Debt Collector
Suttell and Hammer
Synergetic Communication
Synerprise Consulting
The Law Office of Michael J Scott
Trellis Company
Troy Capital
TRS Recovery Services
Tulsa Teachers Credit Union
UCB Collection
Unifin Debt Collector
Universal Credit Services
US Bank Collections
USAA collections
USCB America
Valentine and Kebartas
Valley Servicing
Vance & Huffman LLC
Van Ru Credit Corporation
Velo Law Office
Velocity Investments
Viking Client Services
Wakefield and Associates
Waypoint Resource Group
Weinberg and Associates
Weltman, Weinberg & Reis
Westwood Funding
Williams and Fudge
Wilshire Consumer Credit
Wolpoff & Abramson
Worldwide Asset Purchasing
www.AutomotiveCredit.com
Zarzaur & Schwartz
Zwicker & Associates

Resolve your debt with your creditor

Some creditors, banks, and lenders have an internal collections department. If they come after you for a debt, Solosuit can still help you respond and resolve the debt. Here’s a list of guides on how to resolve debt with different creditors.

American Express ; American Express – Debt Collection
Bank of America
Best Buy Credit Card
Capital One
Credit One Bank
Old Navy Credit Card
PayPal Synchrony Card
Regional Finance
Retailers National Bank
Reunion Student Loan Finance Corporation
SYNCB/PPEXTR
Synchrony Bank
Synchrony Walmart Card
Target National Bank
Wells Fargo
Can I Pay My Original Creditor Instead of a Debt Collection Agency?
Can I Settle a Debt with the Original Creditor?

Settle your medical debt

Having a health challenge is stressful, but dealing medical debt on top of it is overwhelming. Here are some resources on how to manage medical debt.

Am I Responsible for My Spouse's Medical Debt?
Do I Need a Lawyer for Medical Bills?
Do I Need a Lawyer to Fight Medical Bill Debt?
Does Bankruptcy Clear Medical Debt?
How Much Do Collection Agencies Pay for Medical Debt?
How to Find Medical Debt Forgiveness Programs
Is There a Statute of Limitations on Medical Bills?
Medical Debt Statute of Limitations by State
Summoned to Court for Medical Bills — What Do I Do?
Summoned to Court for Medical Bills? What to Do Next

Guides on arbitration

If the thought of going to court stresses you out, you’re not alone. Many Americans who are sued for credit card debt utilize a Motion to Compel Arbitration to push their case out of court and into arbitration.

Below are some resources on how to use an arbitration clause to your advantage and win a debt lawsuit.

How Arbitration Works
How to Find an Arbitration Clause in Your Credit Agreement
How to Make a Motion to Compel Arbitration
How to Make a Motion to Compel Arbitration in Florida
How to Make a Motion to Compel Arbitration Without an Attorney
How Credit Card Arbitration Works
Sample Motion to Compel Arbitration

Stop calls from debt collectors

Do you keep getting calls from an unknown number, only to realize that it’s a debt collector on the other line? If you’ve been called by any of the following numbers, chances are you have collectors coming after you, and we’ll tell you how to stop them.

1-800-390-7584
800-289-8004
800-955-6600
877-366-0169
877-591-0747
800-278-2420
800-604-0064
800-846-6406
877-317-0948
888-899-4332
888-912-7925
202-367-9070
502-267-7522

Federal debt collection laws can protect you

Knowing your rights makes it easier to stand up for your rights. Below, we’ve compiled all our articles on federal debt collection laws that protect you from unfair practices.

15 USC 1692 Explained
Does the Fair Credit Reporting Act Work in Florida?
FDCPA Violations List
How to File an FDCPA Complaint Against Your Debt Collector (Ultimate Guide)
How to Make a Fair Debt Collection Practices Act Demand Letter
How to Submit a Transunion Dispute
How to Submit an Equifax Dispute
How to Submit an Experian Dispute
What Debt Collectors Cannot Do — FDCPA Explained
What Does Account Information Disputed by Consumer Meets FCRA Requirements Mean?
What does “meets FCRA requirements” mean?
What does FCRA stand for?
What is the Consumer Credit Protection Act

Get debt relief in your state

We’ve created a specialized guide on how to find debt relief in all 50 states, complete with steps to take to find relief, state-specific resources, and more.

Debt collection laws in all 50 states

Debt collection laws vary by state, so we have compiled a guide to each state’s debt collection laws to make it easier for you to stand up for your rights—no matter where you live.

Debt Collection Laws in Alabama
Debt Collection Laws in Alaska
Debt Collection Laws in Arizona
Debt Collection Laws in Arkansas
Debt Collection Laws in California
Debt Collection Laws in Colorado
Debt Collection Laws in Connecticut
Debt Collection Laws in Delaware
Debt Collection Laws in Florida
Debt Collection Laws in Georgia
Debt Collection Laws in Hawaii
Debt Collection Laws in Kansas
Debt Collection Laws in Idaho
Debt Collection Laws in Illinois
Debt Collection Laws in Indiana
Debt Collection Laws in Iowa
Debt Collection Laws in Kentucky
Debt Collection Laws in Louisiana
Debt Collection Laws in Massachusetts
Debt Collection Laws in Michigan
Debt Collection Laws in Minnesota
Debt Collection Laws in Mississippi
Debt Collection Laws in Missouri
Debt Collection Laws in Montana
Debt Collection Laws in Nebraska
Debt Collection Laws in Nevada
Debt Collection Laws in New Hampshire
Debt Collection Laws in New Jersey
Debt Collection Laws in New Mexico
Debt Collection Laws in New York
Debt Collection Laws in North Carolina
Debt Collection Laws in North Dakota
Debt Collection Laws in Ohio
Debt Collection Laws in Oklahoma
Debt Collection Laws in Oregon
Debt Collection Laws in Pennsylvania
Debt Collection Laws in Rhode Island
Debt Collection Laws in South Carolina
Debt Collection Laws in South Dakota
Debt Collection Laws in Tennessee
Debt Collection Laws in Texas
Debt Collection Laws in Vermont
Debt Collection Laws in Virginia
Debt Collection Laws in Washington
Debt Collection Laws in West Virginia
Debt Collection Laws in Wisconsin
Debt Collection Laws in Wyoming

Statute of limitations on debt state guides

Like all debt collection laws, the statute of limitations on debt varies by state. So, we wrote a guide on each state’s statutes. Check it out below.

Statute of Limitations on Debt Collection by State (Best Guide)

Statute of Limitations on Debt Collection in Alabama
Statute of Limitations on Debt Collection in Alaska
Statute of Limitations on Debt Collection in Arizona
Statute of Limitations on Debt Collection in Arkansas
Statute of Limitations on Debt Collection in California
Statute of Limitations on Debt Collection in Connecticut
Statute of Limitations on Debt Collection in Colorado
Statute of Limitations on Debt Collection in Delaware
Statute of Limitations on Debt Collection in Florida
Statute of Limitations on Debt Collection in Georgia
Statute of Limitations on Debt Collection in Hawaii
Statute of Limitations on Debt Collection in Illinois
Statute of Limitations on Debt Collection in Indiana
Statute of Limitations on Debt Collection in Iowa
Statute of Limitations on Debt Collection in Kansas
Statute of Limitations on Debt Collection in Louisiana
Statute of Limitations on Debt Collection in Maine
Statute of Limitations on Debt Collection in Maryland
Statute of Limitations on Debt Collection in Michigan
Statute of Limitations on Debt Collection in Minnesota
Statute of Limitations on Debt Collection in Mississippi
Statute of Limitations on Debt Collection in Missouri
Statute of Limitations on Debt Collection in Montana
Statute of Limitations on Debt Collection in Nebraska
Statute of Limitations on Debt Collection in Nevada
Statute of Limitations on Debt Collection in New Hampshire
Statute of Limitations on Debt Collection in New Jersey
Statute of Limitations on Debt Collection in New Mexico
Statute of Limitations on Debt Collection in New York
Statute of Limitations on Debt Collection in North Carolina
Statute of Limitations on Debt Collection in North Dakota
Statute of Limitations on Debt Collection in Oklahoma
Statute of Limitations on Debt Collection in Oregon
Statute of Limitations on Debt Collection in Oregon (Complete Guide)
Statute of Limitations on Debt Collection in Pennsylvania
Statute of Limitations on Debt Collection in Rhode Island
Statute of Limitations on Debt Collection in South Carolina
Statute of Limitations on Debt Collection in South Dakota
Statute of Limitations on Debt Collection in Tennessee
Statute of Limitations on Debt Collection in Texas
Statute of Limitations on Debt Collection in Utah
Statute of Limitations on Debt Collection in Vermont
Statute of Limitations on Debt Collection in Virginia
Statute of Limitations on Debt Collection in Washington
Statute of Limitations on Debt Collection in West Virginia
Statute of Limitations on Debt Collection in Wisconsin
Statute of Limitations on Debt Collection in Wyoming

Check the status of your court case

Don’t have time to go to your local courthouse to check the status of your case? We’ve created a guide on how to check the status of your case in every state, complete with online search tools and court directories.

Alabama Court Case Search—Find Your Lawsuit
Alaska Court Case Search — Find Your Lawsuit
Arizona Court Case Search - Find Your Lawsuit
Arkansas Court Case Search — Find Your Lawsuit
California Court Case Search- Find Your Lawsuit
Colorado Court Case Search — Find Your Lawsuit
Connecticut Case Lookup — Find Your Court Case
Delaware Court Case Search — Find Your Lawsuit
Florida Court Case Search — Find Your Lawsuit
Georgia Court Case Search — Find Your Lawsuit
Hawaii Court Case Search — Find Your Lawsuit
Idaho Court Case Search – Find Your Lawsuit
Illinois Court Case Search — Find Your Lawsuit
Indiana Court Case Search — Find Your Lawsuit
Iowa Court Case Search — Find Your Lawsuit
Kansas Court Case Search — Find Your Lawsuit
Kentucky Court Case Search — Find Your Lawsuit
Louisiana Court Case Search — Find Your Lawsuit
Maine Court Case Search — Find Your Lawsuit
Maryland Court Case Search — Find Your Lawsuit
Massachusetts Court Case Search — Find Your Lawsuit
Michigan Court Case Search — Find Your Lawsuit
Minnesota Court Case Search — Find Your Lawsuit
Mississippi Court Case Search — Find Your Lawsuit
Missouri Court Case Search — Find Your Lawsuit
Montana Court Case Search — Find Your Lawsuit
Nebraska Court Case Search — Find Your Lawsuit
Nevada Court Case Search — Find Your Lawsuit
New Hampshire Court Case Search — Find Your Lawsuit
New Jersey Court Case Search—Find Your Lawsuit
New Mexico Court Case Search - Find Your Lawsuit
New York Case Search — Find Your Lawsuit
North Carolina Court Case Search — Find Your Lawsuit
North Dakota Court Case Search �� Find Your Lawsuit
Ohio Court Case Search — Find Your Lawsuit
Oklahoma Court Case Search — Find Your Lawsuit
Oregon Court Case Search — Find Your Lawsuit
Pennsylvania Court Case Search — Find Your Lawsuit
Rhode Island Court Case Search — Find Your Lawsuit
South Carolina Court Case Search — Find Your Lawsuit
South Dakota Court Case Search — Find Your Lawsuit
Tennessee Court Case Search — Find Your Lawsuit
Texas Court Case Search — Find Your Lawsuit
Utah Court Case Search — Find Your Lawsuit
Vermont Court Case Search — Find Your Lawsuit
Virginia Court Case Search — Find Your Lawsuit
Washington Court Case Search — Find Your Lawsuit
West Virginia Court Case Search — Find Your Lawsuit
Wisconsin Court Case Search — Find Your Lawsuit
Wyoming Court Case Search — Find Your Lawsuit

How to stop wage garnishment in your state

Forgot to respond to your debt lawsuit? The judge may have ordered a default judgment against you, and with a default judgment, debt collectors can garnish your wages. Here are our guides on how to stop wage garnishment in all 50 states.

Stop Wage Garnishment in Alabama
Stop Wage Garnishment in Alaska
Stop Wage Garnishment in Arizona
Stop Wage Garnishment in Arkansas
Stop Wage Garnishment in California
Stop Wage Garnishment in Colorado
Stop Wage Garnishment in Connecticut
Stop Wage Garnishment in Delaware
Stop Wage Garnishment in Florida
Stop Wage Garnishment in Georgia
Stop Wage Garnishment in Hawaii
Stop Wage Garnishment in Idaho
Stop Wage Garnishment in Illinois
Stop Wage Garnishment in Indiana
Stop Wage Garnishment in Iowa
Stop Wage Garnishment in Kansas
Stop Wage Garnishment in Kentucky
Stop Wage Garnishment in Louisiana
Stop Wage Garnishment in Maine
Stop Wage Garnishment in Maryland
Stop Wage Garnishment in Massachusetts
Stop Wage Garnishment in Michigan
Stop Wage Garnishment in Minnesota
Stop Wage Garnishment in Mississippi
Stop Wage Garnishment in Missouri
Stop Wage Garnishment in Montana
Stop Wage Garnishment in Nevada
Stop Wage Garnishment in New Hampshire
Stop Wage Garnishment in New Jersey
Stop Wage Garnishment in New Mexico
Stop Wage Garnishment in New York
Stop Wage Garnishment in North Carolina
Stop Wage Garnishment in North Dakota
Stop Wage Garnishment in Ohio
Stop Wage Garnishment in Oklahoma
Stop Wage Garnishment in Oregon
Stop Wage Garnishment in Pennsylvania
Stop Wage Garnishment in Rhode Island
Stop Wage Garnishment in South Carolina
Stop Wage Garnishment in South Dakota
Stop Wage Garnishment in Tennessee
Stop Wage Garnishment In Texas
Stop Wage Garnishment In Utah
Stop Wage Garnishment in Vermont
Stop Wage Garnishment in Virginia
Stop Wage Garnishment in Washington
Stop Wage Garnishment in West Virginia
Stop Wage Garnishment in Wisconsin
Stop Wage Garnishment in Wyoming

Other wage garnishment resources

Bank Account Garnishment and Liens in Texas
Can I Stop Wage Garnishment?
Can My Wife's Bank Account Be Garnished for My Debt?
Can Payday Loans Garnish Your Wages?
Can pensions be garnished?
Can Private Disability Payments Be Garnished?
Can Social Security Disability Be Garnished?
Can They Garnish Your Wages for Credit Card Debt?
Can You Stop a Garnishment Once It Starts?
Guide to Garnishment Limits by State
How Can I Stop Wage Garnishments Immediately?
How Long Before a Creditor Can Garnish Wages?
How Long Does It Take to Get Garnished Wages Back?
How to Fight a Wage Garnishment
How to Prevent Wage Garnishment
How to Stop a Garnishment
How to Stop Social Security Wage Garnishment
How to Stop Wage Garnishment — Everything You Need to Know
New York Garnishment Laws – Overview
Ohio Garnishment Laws — What They Say
Wage Garnishment Lawyer
What Is Wage Garnishment?

How to settle a debt in your state

Debt settlement is one of the most effective ways to resolve a debt and save money. We’ve created a guide on how to settle your debt in all 50 states. Find out how to settle in your state with a simple click and explore other debt settlement resources below.

How to Settle a Debt in Alabama
How to Settle a Debt in Alaska
How to Settle a Debt in Arizona
How to Settle a Debt in Arkansas
How to Settle a Debt in California
How to Settle a Debt in Colorado
How to Settle a Debt in Delaware
How to Settle a Debt in Florida
How to Settle a Debt in Hawaii
How to Settle a Debt in Idaho
How to Settle a Debt in Illinois
How to Settle a Debt in Indiana
How to Settle a Debt in Iowa
How to Settle a Debt in Kansas
How to Settle a Debt in Kentucky
How to Settle a Debt in Louisiana
How to Settle a Debt in Maryland
How to Settle a Debt in Massachusetts
How to Settle a Debt in Michigan
How to Settle a Debt in Minnesota
How to Settle a Debt in Mississippi
How to Settle a Debt in Missouri
How to Settle a Debt in Montana
How to Settle a Debt in Nebraska
How to Settle a Debt in Nevada
How to Settle a Debt in New Hampshire
How to Settle a Debt in New Jersey
How to Settle a Debt in New Mexico
How to Settle a Debt in New York
How to Settle a Debt in North Carolina
How to Settle a Debt in North Dakota
How to Settle a Debt in Ohio
How to Settle a Debt in Oklahoma
How to Settle a Debt in Oregon
How to Settle a Debt in Pennsylvania
How to Settle a Debt in South Carolina
How to Settle a Debt in South Dakota
How to Settle a Debt in Tennessee
How to Settle a Debt in Texas
How to Settle a Debt in Utah
How to Settle a Debt in Vermont
How to Settle a Debt in Virginia
How to Settle a Debt in West Virginia
How to Settle a Debt in Wisconsin
How to Settle a Debt in Wyoming

How to settle with every debt collector

Not sure how to negotiate a debt settlement with a debt collector? We are creating guides to help you know how to start the settlement conversation and increase your chances of coming to an agreement with every debt collector.

American Express
Capitol One
Cavalry SPV
Midland Funding
Moore Law Group
Navy Federal
NCB Management Services
Portfolio Recovery

Other debt settlement resources

Best Debt Settlement Companies
Can I Settle a Debt After Being Served?
Can I Still Settle a Debt After Being Served?
Can You Settle a Warrant in Debt Before Court?
Debt Management vs. Debt Settlement
Debt Settlement Pros and Cons
Debt Settlement Scam
Do I Need to Hire a Debt Settlement Lawyer?
Do You Need a Debt Settlement Attorney in Houston Texas?
Do You Owe Taxes on Settled Debt?
Here’s a Sample Letter to Collection Agencies to Settle Debt
How Can I Settle My Credit Card Debt Before Going to Court?
How Do I Know if a Debt Settlement Company Is Legitimate?
How Long Does a Lawsuit Take to Settle?
How Much Do Settlement Companies Charge?
How I Settled My Credit Card Debt With Discover
How to Make a Debt Settlement Agreement
How to Make a Settlement Offer to Navient
How to Negotiate a Debt Settlement with a Law Firm
How to send Santander a settlement letter
How to Settle Debt for Pennies on the Dollar
How to Settle Debt in 3 Steps
How to Settle Debt with a Reduced Lump Sum Payment
How to Settle a Credit Card Debt Lawsuit — Ultimate Guide
How to Settle Credit Card Debt When a Lawsuit Has Been Filed
If You Are Using a Debt Relief Agency, Can You Settle Yourself with the Creditor?
Largest Debt Settlement Companies
Should I Settle a Collection or Pay in Full?
Summary of the Equifax Data Breach Settlement
The Advantages of Pre-Settlement Lawsuit Funding
The FTC Regulates Debt Settlement Through the Telemarketing Sales Rule
The Pros and Cons of Debt Settlement
What Happens if I Reject a Settlement Offer?
What Happens if You Don't Pay a Debt Settlement?
What Happens When You Settle a Debt?
What Is A Debt Settlement Agreement?
What is Debt Settlement?
What Percentage Should I Offer to Settle Debt?
What to Ask for in a Settlement Agreement
Who Qualifies for Debt Settlement?
Will Collection Agencies Settle for Less?
5 Signs of a Debt Settlement Scam

Personal loan and debt relief reviews

We give a factual review of the following debt consolidation, debt settlement, and loan organizations and companies to help you make an informed decision before you take on a debt.

Accredited Debt Relief Debt Settlement Reviews
Advance America Loan Review
ACE Cash Express Personal Loan Review
BMG Money Loan Review
BMO Harris Bank Review: Pros and Cons
Brite Solutions Debt Settlement Reviews
Caliber Home Loans Mortgage Review
Cambridge Debt Consolidation Review
Campus Debt Solutions Review
CashNetUSA Review
Century Debt Settlement Reviews
ClearPoint Debt Management Review
Click N Loan Reviews
CuraDebt Debt Settlement Review
CuraDebt Reviews: Debt Relief Assistance For California Residents
Debt Eraser Review
Debtconsolidation.com Debt Settlement Reviews
Eagle One Debt Settlement Reviews
Freedom Debt Relief Debt Settlement Reviews
Global Holdings Debt Settlement Reviews
Golden 1 Credit Union Personal Loan Review
Honda Financial Services Review
iLending Reviews
Infinite Law Group Debt Settlement Reviews
JG Wentworth Debt Settlement Reviews
LoanMart Reviews
Mastriani Law Firm Review
Milestone ® Mastercard ® Review
ModoLoan Review
Money Management International Reviews
M&T Mortgage Company Review
National Debt Relief Debt Settlement Reviews
New Era Debt Settlement Reviews
OppLoans Review
Pacific Debt Relief Reviews
Palisade Legal Group Debt Settlement Reviews
PCG Debt Consolidation Review
PenFed Auto Loan Review
Priority Plus Financial Reviews
Roseland Associates Debt Consolidation Review
SDCCU Debt Consolidation Review
Speedy Cash Loans Review
Symple Lending Reviews
Tripoint Lending Reviews
TurboDebt Debt Settlement Reviews
Turnbull Law Group Debt Settlement Reviews
United Debt Settlement Reviews
Upgrade Auto Loans Reviews

How to repair and improve your credit score

Debt has a big impact on your credit. Below is a list of guides on how to repair and improve your credit, even while managing major debt.

3 Ways to Repair Your Credit with Debt Collections
5 Pros and Cons of Credit Cards & How to Use Them Wisely
6 Reasons Your Credit Score Isn't Going Up
Bankruptcy vs Debt Settlement: Which is Better for Your Credit Score?
Does Debt Consolidation Hurt Your Credit Score?
Does Wage Garnishment Affect Credit?
Guide to Disclosing Income on Your Credit Card Application
How Long Does It Take to Improve My Credit Score After Debt Settlement?
How Often Does Merrick Bank Increase Your Credit Limit?
How to fix your credit to buy a house
How to Handle Debt and Improve Credit
How to Raise My Credit Score 40 Points Fast
If I Settle with a Collection Agency, Will It Hurt My Credit?
Is 600 a Good Credit Score?
Obama Credit Card Debt Relief Program – How to Use It
Sample credit report dispute letter
Should I Use Credit Journey?
Understanding myFICO: Your Gateway to Better Credit
What Does "DLA" Mean on a Credit Report?
What Is A Good Credit Score For Businesses?
What is American Credit Acceptance?
What is CBNA on my credit report?
What is CreditFresh?
Who Made the Credit Score?
Why is THD/CBNA on my credit report?

How to resolve student loan debt

Struggling with student debt? SoloSuit’s got you covered. Below are resources on handling student loan debt.

Budgeting Strategies for Students: How to Manage Your Finances Wisely
Can You Go to Jail for Not Paying Student Loans?
Can You Settle Student Loan Debt?
Do Student Loans Go Away After 7 Years? (2022 Guide)
Do You Need a Student Loan Lawyer? (Complete Guide)
Does Student Debt Die With You?
How to Manage a Student Debt
How to Get Rid of Student Loan Debt
Mandatory Forbearance Request Student Loan Debt Burden
Negative Economic Effects of Student Loan Debt on the US Economy
Pros and Cons of Taking a Student Loan
Regional Adjustment Bureau Student Loans – How to Win
The Real Impact of Student Debt: How Our Brains Handle It
Why It's Important to Teach Students How to Manage Debt
5 Alternatives to Taking a Student Loan
5 Tips for Students: How to Create a Realistic and Effective Budget
7 College Financial Planning Tips for Students
7 Things to Consider When Taking a Student Loan
7 Tips to Manage Your Student Loans

Civil law legal definitions

You can represent yourself in court. Save yourself the time and cost of finding an attorney, and use the following resources to understand legal definitions better and how they may apply to your case.

Accleration Clause — Definition
Adjuster - Defined
Adverse Action — Definition
Affidavit — A Definition
Annulment vs. divorce – what's the difference?
Anticipatory Repudiation — Definition
Bench Trial — Defined
Certificate of Debt: A Definition
Commuted Sentence – Definition
Constructive Eviction - Defined
Constructive Discharge - Definition
Defendant - Definition and Everything You Need to Know
Demurred – Definition
Dischargeable - Definition
Disclosures — Definition
False Imprisonment Defined
Good Faith Exception – Definition
Hearsay — A Definition
HOEPA – Definition
Implied Contract – Definition
Injunctive Relief — A Definition
Intestate–Defined
Irrevocable Agreement — Defined
Joint Custody–Defined
Litigator — A Definition
Mediation - Definition
Medical Malpractice — Definition
Mistrial — A Definition
Mitigating Circumstances — Definition
Motion for Summary Judgment — Definition
Nolle Prosequi – Definition
Nunc Pro Tunc — A Definition
Plaintiff - Definition and Everything You Need to Know
Pro Se - Defined
Probable Cause Hearing — Definition
Restitution – Definition
Sole Custody-Defined
Statute of Limitations—Definition and Everything You Need to Know
Summons—Definition
Tenancy in Common – Defined
Time Is of the Essence – Definition
What Is the Bankruptcy Definition of Consumer Debt?
Wrongful Termination–Defined

Get answers to these FAQs on debt collection

Am I Responsible for My Husband's Debts If We Divorce?
Am I Responsible for My Parent's Debt if I Have Power of Attorney?
Can a Collection Agency Add Fees on the Debt?
Can a Collection Agency Charge Interest on a Debt?
Can a Credit Card Company Sue Me?
Can a Debt Collector Freeze Your Bank Account?
Can a Debt Collector Leave a Voicemail?
Can a Debt Collector Take My Car in California?
Can a Judgment Creditor Take my Car?
Can a Process Server Leave a Summons Taped to My Door?
Can an Eviction Be Reversed?
Can Credit Card Companies Garnish Your Wages?
Can Credit Cards Garnish Wages?
Can Debt Collectors Call From Local Numbers?
Can Debt Collectors Call You at Work in Texas?
Can Debt Collectors Call Your Family?
Can Debt Collectors Leave Voicemails?
Can I Pay a Debt Before the Court Date?
Can I Rent an Apartment if I Have Debt in Collection?
Can I Sue the President for Emotional Distress?
Can the SCRA Stop a Default Judgment?
Can the Statute of Limitations be Extended?
Can You Appeal a Default Judgement?
Can You Get Unemployment if You Quit?
Can You Go to Jail for a Payday Loan?
Can You Go to Jail for Credit Card Debt?
Can You Negotiate with Westlake Financial?
Can You Record a Call with a Debt Collector in Your State?
Can You Serve Someone with a Collections Lawsuit at Their Work?
Can You Sue Someone Who Has Filed Chapter 7 Bankruptcy?
Capital One is Suing Me – How Can I Win?
Debt Snowball vs. Debt Avalanche: Which One Is Apt for You?
Do 609 Letters Really Work?
Do Debt Collectors Ever Give Up?
Do I Have Too Much Debt to Divorce My Spouse?
Do I Need a Debt Collection Defense Attorney?
Do I Need a Debt Negotiator?
Do I Need a Legal Coach?
Do I Need a Payday Loans Lawyer?
Does a Living Trust Protect Your Assets from Lawsuits?
Does Chase Sue for Credit Card Debt?
Does Debt Consolidation Have Risks?
Does Midland Funding Show Up to Court?
How Can I Get Financial Assistance in PA?
How do Debt Relief Scams Work?
How Do I Find Out If I Have Any Judgments Against Me?
How Do I Get Rid of a Judgment Lien on My Property?
How Do I Register on the Do Not Call List?
How Does a Flex Loan Work?
How Does Debt Affect Your Ability to Buy a Home?
How Does Finwise Bank Work?
How does Navy Credit debt forgiveness work?
How Does Payments.tsico Work?
How Important is it to Protect your Assets from Unexpected Events?
How is Debt Divided in Divorce?
How Long Do Creditors Have to Collect a Debt from an Estate?
How long do debt collectors take to respond to debt validation letters?
How Long Does a Judgement Last?
How Long Does a Judgment Last?
How Long Does a Levy Stay on a Bank Account?
How Long Does an Eviction Stay on Your Record?
How Many Calls from a Debt Collector is Considered Harassment?
How Many Times Can a Judgment Be Renewed in North Carolina?
How Many Times Can a Judgment be Renewed in Oklahoma?
How Much Do Collection Agencies Pay for Debt?
How Much Do You Have to Be in Debt to File Chapter 7?
How Much Does College Actually Cost?
How Often Do Credit Card Companies Sue for Non-Payment?
How Should You Respond to the Theft of Your Identity?
I am being sued because my identity was stolen - What do I do?
If a Car is Repossessed Do I Still Owe the Debt?
Is Debt Forgiveness Taxable?
Is Freedom Debt Relief a Scam?
Is it Legal for Debt Collectors to Call Family Members?
Is it Smart to Consolidate Debt?
Is LVNV Funding a Legitimate Company? - Them in Court
Is My Case in the Right Venue?
Is Portfolio Recovery Associates Legit? — How to Win
Is Severance Pay Taxable?
Is SoloSuit Worth It?
Is Someone with Power of Attorney Responsible for Debt After Death?
Is the NTB Credit Card Safe?
Is There a Judgment Against Me Without my Knowledge?
Is transworld systems legitimate? — How to win in court
Liquidate–What Does it Mean?
Litigation Finance: Is it a Good Investment?
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Should I File Bankruptcy Before or After a Judgment?
Should I Hire a Civil Litigation Attorney?
Should I Hire a Civil Rights Lawyer?
Should I Hire a Litigation Attorney?
Should I Marry Someone With Debt?
Should I Pay Off an Old Apartment Debt?
Should I Send a Demand Letter Before a Lawsuit?
Should I Use My IRA to Pay Off Credit Card Debt?
Should You Communicate with a Debt Collector in Writing or by Telephone?
Should You Invest in Stocks While In Debt?
Subsidized vs. Unsubsidized Loans: Which is Better?
The Truth: Should You Never Pay a Debt Collection Agency?
What are the biggest debt collector companies in the US?
What are the different types of debt?
What Bank Is Behind Best Buy's Credit Card?
What Bank Issues Kohl's Credit Card?
What Bank Owns Old Navy Credit Card?
What Credit Bureau does Aqua Finance Use?
What Credit Bureau Does Truliant Use?
What Does “Apple Pay Transaction Under Review” Mean?
What Does a Debt Collector Have to Prove in Court?
What Does BAC Stand For?
What does HAFA stand for?
What Does Payment Deferred Mean?
What Does Reaffirmation of Debt Mean?
What Happens After a Motion for Default Is Filed?
What Happens at a Motion for Summary Judgment Hearing?
What Happens If a Defendant Does Not Pay a Judgment?
What Happens If a Process Server Can't Serve You?
What Happens if a Tenant Wins an Eviction Lawsuit?
What Happens If Someone Sues You and You Have No Money?
What Happens If You Avoid Getting Served Court Papers?
What Happens If You Don’t Pay Speedy Cash?
What Happens If You Ignore a Debt Collector?
What Happens If You Never Answer Debt Collectors?
What Happens When a Debt Is Sold to a Collection Agency
What Happens When a Debt Is Sold to a Collection Agency?
What If a Summons Was Served to the Wrong Person?
What If an Order for Default Was Entered?
What if I default on an Avant payment?
What If the Wrong Defendant Is Named in a Lawsuit?
What Is a Case Number?
What is a Certificate of Judgment in Ohio?
What Is a Certificate of Service?
What Is a Civil Chapter 61 Warrant?
What is a Civil Litigation Lawyer?
What Is a Consent Judgment?
What Is a CPN Number?
What Is a Debt Brokerage?
What Is a Debt-to-Sales Ratio?
What Is a Defamation Lawsuit?
What is a default judgment?— What do I do?
What Is a Libel Lawsuit?
What is a Lien on a House?
What is a Lien Release on a Car?
What is a Lien?
What Is a Motion to Strike?
What Is a Motion to Suppress?
What Is a Non-Dischargeable Debt in Tennessee?
What Is a Nonsuit Without Prejudice?
What Is a Preliminary Hearing?
What Is a Reaffirmation Agreement?
What Is a Request for Dismissal?
What Is a Rule 3.740 Collections Defense in California?
What Is a Slander Lawsuit?
What is a Stipulated Judgment?
What Is a Warrant in Debt?
What is ABC Financial Club Charge?
What is ACS Ed Services?
What is Advanced Call Center Technologies?
What is Alimony?
What Is Allied Interstate's Phone Number?
What is an Affirmative Defense?
What Is an Assignment of Debt?
What Is an Attorney Malpractice Lawsuit?
What Is an Unlawful Detainer Lawsuit?
What is Bank of America CashPro?
What is Bitty Advance?
What Is Celtic Bank?
What is Consumer Portfolio Services?
What Is Credence Resource Management?
What Is Debt Internment?
What Is Discover's 60/60 plan?
What is Evading the Police?
What Is Extinguishment of Debt?
What is First Investors Financial Services?
What is Global Lending Services?
What is homicide?
What Is Lexington Law Firm?
What is LGFCU Personal Loan?
What is Moral Turpitude?
What is Online Information Services?
What is Oportun?
What Is Service of Process in Texas?
What is sewer service?
What Is Summary Judgment?
What is Synchrony Bank's Hardship Program?
What Is T-Mobile's Phone Number for Debt Collection?
What Is the Amount of Money You Still Owe to Their Credit Card Company Called?
What is the Deadline for a Defendant's Answer to Avoid a Default Judgment?
What Is the Formula for Calculating Closing Costs?
What Is the Minimum Amount That a Collection Agency Will Sue For?
What Is the Phone Number for IQ Data?
What is the Purpose of the Truth in the Lending Act?
What is the status of my case?
What Is the Statute of Limitations on Debt in Washington?
What is the Telemarketing Sales Rule?
What is Unsecured Credit Card Debt?
What is WCTCB?
What is WFDS?
What is WUVISAAFT?
What is Zombie Debt, and How Do I Deal With It?
What Personal Property Can Be Seized in a Judgment?
What Should I Do If Crown Asset Management Suing Me?
What Should I Do If OneMain Financial Is Taking Me to Court?
What Should You Do if You Can't Pay Your Mortgage?
What states require a professional licensing number for debt collectors?
When Does Exeter Finance Repo Cars?
When Is My Rent Due Legally?
Where’s My Amended Tax Return?
Which Bank Does Macy's Credit Card Use?
Who is EOSCCA?
Who is Over the Loan Forgiveness Program at KHESLC?
Who is Synchrony Bank? — Beat Them in Court
Who is Jefferson Capital Systems LLC — How to win in court
Why Being Judgment Proof Is Not a Defense to a Lawsuit
Why Can't Lawyers Give Legal Advice?
Who is Synchrony Bank? — Them in Court
Why Do Debt Collectors Block Their Phone Numbers?
Why Do Lawyers Charge So Much?
Why Is the Sheriff Looking for Me?
Why Would a Sheriff Come to My House with Papers?
Will Bankruptcy Stop a Judgment?

How-to debt guides

How to Beat Westlake Portfolio Management
How to Access Free Debt Relief
How to Answer a Lawsuit for Debt Collection
How to Appear in Court by Phone
How to Apply For Unemployment Benefits in Florida
How to Avoid Getting Served
How to Beat a Bill Collector in Court
How to Beat a Debt Collector in Court
How to Beat a Lawsuit From a Debt Collector
How to Cancel a Merrick Bank Credit Card
How to Cancel an American Eagle Credit Card: A Step-by-Step Guide
How to Cancel JCPenney Credit Card
How to Deal with Debt Collectors
How to decide what to do next in a lawsuit
How to Defend Yourself in Court
How To Develop A Debt Repayment Plan That Works
How to Discharge a Debt with UCC
How to Dispute a Debt and Win
How to Dispute a False Positive Drug Test
How to dispute a rental collection
How to Drag Out an Eviction
How to Fight a Motion for Relief From Automatic Stay
How to Fight an Eviction
How to Fight Debt Collectors in Court and Win
How to File a Civil Answer in Kings County Supreme Court
How to File a Civil Answer With the Duval Clerk of Courts - Florida
How to File a Motion to Extend Time
How to File a Motion to Satisfy Judgment in Utah
How to File a Motion to Set Aside Judgment
How to File Chapter 13 Without an Attorney
How to File in Bergen County Superior Court
How to File in Deschutes County Circuit Court
How to File in Josephine County Courthouse
How to File in Miamisburg Municipal Court
How to File in Monmouth County Courthouse
How to File in Oak Grove Courthouse
How to File in Oregon Small Claims Court
How to File in Small Claims Court in Iowa
How to File in the Houston County Superior Court
How To Fill Out the PLD-C-001
How to Find My Bridgecrest Login
How to Find Out If You're Being Sued
How to Find Out What Collection Agency Owns Your Debt
How to Find the Attorney That is Suing You (Secret)
How to get a case dismissed without prejudice on statute of limitations
How to Get a Divorce in Florida
How to Get Credit Card Debt Relief
How to Get Debt Relief (Ultimate 50 State Guide 2023)
How to Get Out of a Bridgecrest Loan
How to get out of a RISE loan
How to Get Out of Debt Before Retirement
How to Get Out of Paying HOA Dues
How to Get Relief From a Gambling Debt
How to Hire a Mediator
How to Identify Age Discrimination in the Employment Act
How to identify fake and abusive debt collectors
How to Liquidate Credit Cards Into Cash
How to liquidate your assets to pay off debt
How to Make a 609 Letter That Really Works
How to Make a Debt Validation Letter - The Ultimate Guide (2023)
How to Make a Motion to Dismiss
How to Make a Motion to Lift Stay
How to Make a Motion to Vacate Judgment
How to Make a Will
How to Make an Eviction Appeal
How to Make Motion to Set Aside — Ultimate Guide
How to Negotiate a Lien on a House
How to Negotiate Credit Card Debts
How to Paramount Recovery
How To Pay for College and Avoid Debt
How to Pay off Your Destiny Credit Card
How to Perform Voluntary Repossession
How to Protect Your LLC with a Registered Agent Service
How to Recover from a Negative Bank Balance
How to Report the Cancellation of a Debt on a 1040
How to Respond to a Debt Collection Summons in Wyoming
How to Respond to a Debt Lawsuit vs United Collection Bureau
How to Respond to a Lawsuit Against Northstar Location Services
How to Respond to a Sheriff's Note On Your Door
How to respond to a Summons from VanSlam, Inc
How to Respond to Plaintiff's Counsel
How To Respond to Request for Admission
How to Satisfy a Judgment
How to Spot Common IRS Scams
How to Stop Eviction Lawyers
How to Stop Pinnacle Collections Agency
How to Support Employees With Debt – HR Solution
How to Use a Bonus to Solve Your Financial Problems
How to Travel Without Falling into Debt: Embracing the "Workcation"
How to Use King County Superior Court Electronic Filing
How to Use Montgomery County E-Filing
How to use My.Loanbuilder
How to Use the Doctrine of Unclean Hands
How to Walk Away from Credit Card Debt
How to Win a Citibank Debt Lawsuit
How to Win a Collect Pros Dispute
How to Win a Credit One Bank Lawsuit
How to Win a Debt Lawsuit Against Security Credit Services
How to Win a Freedom Debt Relief Lawsuit
How To Win a Mariner Finance Lawsuit
How to Win a Portfolio Recovery Associates Debt Lawsuit
How to Win When Sued by Blitt & Gaines
How to Win When Sued by Pharia LLC
How to Win When You're Sued by Paragon Revenue Group
How to Write a Hardship Letter
How to Write a Re-Aging Debt Letter

Learn more with these additional debt resources

A Comprehensive Guide to Business Loans in the U.S.
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Legal Aid in the US Ultimate Guide (2022)
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assignments basic law

Assignments: The Basic Law

The assignment of a right or obligation is a common contractual event under the law and the right to assign (or prohibition against assignments) is found in the majority of agreements, leases and business structural documents created in the United States.

As with many terms commonly used, people are familiar with the term but often are not aware or fully aware of what the terms entail. The concept of assignment of rights and obligations is one of those simple concepts with wide ranging ramifications in the contractual and business context and the law imposes severe restrictions on the validity and effect of assignment in many instances. Clear contractual provisions concerning assignments and rights should be in every document and structure created and this article will outline why such drafting is essential for the creation of appropriate and effective contracts and structures.

The reader should first read the article on Limited Liability Entities in the United States and Contracts since the information in those articles will be assumed in this article.

Basic Definitions and Concepts:

An assignment is the transfer of rights held by one party called the “assignor” to another party called the “assignee.” The legal nature of the assignment and the contractual terms of the agreement between the parties determines some additional rights and liabilities that accompany the assignment. The assignment of rights under a contract usually completely transfers the rights to the assignee to receive the benefits accruing under the contract. Ordinarily, the term assignment is limited to the transfer of rights that are intangible, like contractual rights and rights connected with property. Merchants Service Co. v. Small Claims Court , 35 Cal. 2d 109, 113-114 (Cal. 1950).

An assignment will generally be permitted under the law unless there is an express prohibition against assignment in the underlying contract or lease. Where assignments are permitted, the assignor need not consult the other party to the contract but may merely assign the rights at that time. However, an assignment cannot have any adverse effect on the duties of the other party to the contract, nor can it diminish the chance of the other party receiving complete performance. The assignor normally remains liable unless there is an agreement to the contrary by the other party to the contract.

The effect of a valid assignment is to remove privity between the assignor and the obligor and create privity between the obligor and the assignee. Privity is usually defined as a direct and immediate contractual relationship. See Merchants case above.

Further, for the assignment to be effective in most jurisdictions, it must occur in the present. One does not normally assign a future right; the assignment vests immediate rights and obligations.

No specific language is required to create an assignment so long as the assignor makes clear his/her intent to assign identified contractual rights to the assignee. Since expensive litigation can erupt from ambiguous or vague language, obtaining the correct verbiage is vital. An agreement must manifest the intent to transfer rights and can either be oral or in writing and the rights assigned must be certain.

Note that an assignment of an interest is the transfer of some identifiable property, claim, or right from the assignor to the assignee. The assignment operates to transfer to the assignee all of the rights, title, or interest of the assignor in the thing assigned. A transfer of all rights, title, and interests conveys everything that the assignor owned in the thing assigned and the assignee stands in the shoes of the assignor. Knott v. McDonald’s Corp ., 985 F. Supp. 1222 (N.D. Cal. 1997)

The parties must intend to effectuate an assignment at the time of the transfer, although no particular language or procedure is necessary. As long ago as the case of National Reserve Co. v. Metropolitan Trust Co ., 17 Cal. 2d 827 (Cal. 1941), the court held that in determining what rights or interests pass under an assignment, the intention of the parties as manifested in the instrument is controlling.

The intent of the parties to an assignment is a question of fact to be derived not only from the instrument executed by the parties but also from the surrounding circumstances. When there is no writing to evidence the intention to transfer some identifiable property, claim, or right, it is necessary to scrutinize the surrounding circumstances and parties’ acts to ascertain their intentions. Strosberg v. Brauvin Realty Servs., 295 Ill. App. 3d 17 (Ill. App. Ct. 1st Dist. 1998)

The general rule applicable to assignments of choses in action is that an assignment, unless there is a contract to the contrary, carries with it all securities held by the assignor as collateral to the claim and all rights incidental thereto and vests in the assignee the equitable title to such collateral securities and incidental rights. An unqualified assignment of a contract or chose in action, however, with no indication of the intent of the parties, vests in the assignee the assigned contract or chose and all rights and remedies incidental thereto.

More examples: In Strosberg v. Brauvin Realty Servs ., 295 Ill. App. 3d 17 (Ill. App. Ct. 1st Dist. 1998), the court held that the assignee of a party to a subordination agreement is entitled to the benefits and is subject to the burdens of the agreement. In Florida E. C. R. Co. v. Eno , 99 Fla. 887 (Fla. 1930), the court held that the mere assignment of all sums due in and of itself creates no different or other liability of the owner to the assignee than that which existed from the owner to the assignor.

And note that even though an assignment vests in the assignee all rights, remedies, and contingent benefits which are incidental to the thing assigned, those which are personal to the assignor and for his sole benefit are not assigned. Rasp v. Hidden Valley Lake, Inc ., 519 N.E.2d 153, 158 (Ind. Ct. App. 1988). Thus, if the underlying agreement provides that a service can only be provided to X, X cannot assign that right to Y.

Novation Compared to Assignment:

Although the difference between a novation and an assignment may appear narrow, it is an essential one. “Novation is a act whereby one party transfers all its obligations and benefits under a contract to a third party.” In a novation, a third party successfully substitutes the original party as a party to the contract. “When a contract is novated, the other contracting party must be left in the same position he was in prior to the novation being made.”

A sublease is the transfer when a tenant retains some right of reentry onto the leased premises. However, if the tenant transfers the entire leasehold estate, retaining no right of reentry or other reversionary interest, then the transfer is an assignment. The assignor is normally also removed from liability to the landlord only if the landlord consents or allowed that right in the lease. In a sublease, the original tenant is not released from the obligations of the original lease.

Equitable Assignments:

An equitable assignment is one in which one has a future interest and is not valid at law but valid in a court of equity. In National Bank of Republic v. United Sec. Life Ins. & Trust Co. , 17 App. D.C. 112 (D.C. Cir. 1900), the court held that to constitute an equitable assignment of a chose in action, the following has to occur generally: anything said written or done, in pursuance of an agreement and for valuable consideration, or in consideration of an antecedent debt, to place a chose in action or fund out of the control of the owner, and appropriate it to or in favor of another person, amounts to an equitable assignment. Thus, an agreement, between a debtor and a creditor, that the debt shall be paid out of a specific fund going to the debtor may operate as an equitable assignment.

In Egyptian Navigation Co. v. Baker Invs. Corp. , 2008 U.S. Dist. LEXIS 30804 (S.D.N.Y. Apr. 14, 2008), the court stated that an equitable assignment occurs under English law when an assignor, with an intent to transfer his/her right to a chose in action, informs the assignee about the right so transferred.

An executory agreement or a declaration of trust are also equitable assignments if unenforceable as assignments by a court of law but enforceable by a court of equity exercising sound discretion according to the circumstances of the case. Since California combines courts of equity and courts of law, the same court would hear arguments as to whether an equitable assignment had occurred. Quite often, such relief is granted to avoid fraud or unjust enrichment.

Note that obtaining an assignment through fraudulent means invalidates the assignment. Fraud destroys the validity of everything into which it enters. It vitiates the most solemn contracts, documents, and even judgments. Walker v. Rich , 79 Cal. App. 139 (Cal. App. 1926). If an assignment is made with the fraudulent intent to delay, hinder, and defraud creditors, then it is void as fraudulent in fact. See our article on Transfers to Defraud Creditors .

But note that the motives that prompted an assignor to make the transfer will be considered as immaterial and will constitute no defense to an action by the assignee, if an assignment is considered as valid in all other respects.

Enforceability of Assignments:

Whether a right under a contract is capable of being transferred is determined by the law of the place where the contract was entered into. The validity and effect of an assignment is determined by the law of the place of assignment. The validity of an assignment of a contractual right is governed by the law of the state with the most significant relationship to the assignment and the parties.

In some jurisdictions, the traditional conflict of laws rules governing assignments has been rejected and the law of the place having the most significant contacts with the assignment applies. In Downs v. American Mut. Liability Ins. Co ., 14 N.Y.2d 266 (N.Y. 1964), a wife and her husband separated and the wife obtained a judgment of separation from the husband in New York. The judgment required the husband to pay a certain yearly sum to the wife. The husband assigned 50 percent of his future salary, wages, and earnings to the wife. The agreement authorized the employer to make such payments to the wife.

After the husband moved from New York, the wife learned that he was employed by an employer in Massachusetts. She sent the proper notice and demanded payment under the agreement. The employer refused and the wife brought an action for enforcement. The court observed that Massachusetts did not prohibit assignment of the husband’s wages. Moreover, Massachusetts law was not controlling because New York had the most significant relationship with the assignment. Therefore, the court ruled in favor of the wife.

Therefore, the validity of an assignment is determined by looking to the law of the forum with the most significant relationship to the assignment itself. To determine the applicable law of assignments, the court must look to the law of the state which is most significantly related to the principal issue before it.

Assignment of Contractual Rights:

Generally, the law allows the assignment of a contractual right unless the substitution of rights would materially change the duty of the obligor, materially increase the burden or risk imposed on the obligor by the contract, materially impair the chance of obtaining return performance, or materially reduce the value of the performance to the obligor. Restat 2d of Contracts, § 317(2)(a). This presumes that the underlying agreement is silent on the right to assign.

If the contract specifically precludes assignment, the contractual right is not assignable. Whether a contract is assignable is a matter of contractual intent and one must look to the language used by the parties to discern that intent.

In the absence of an express provision to the contrary, the rights and duties under a bilateral executory contract that does not involve personal skill, trust, or confidence may be assigned without the consent of the other party. But note that an assignment is invalid if it would materially alter the other party’s duties and responsibilities. Once an assignment is effective, the assignee stands in the shoes of the assignor and assumes all of assignor’s rights. Hence, after a valid assignment, the assignor’s right to performance is extinguished, transferred to assignee, and the assignee possesses the same rights, benefits, and remedies assignor once possessed. Robert Lamb Hart Planners & Architects v. Evergreen, Ltd. , 787 F. Supp. 753 (S.D. Ohio 1992).

On the other hand, an assignee’s right against the obligor is subject to “all of the limitations of the assignor’s right, all defenses thereto, and all set-offs and counterclaims which would have been available against the assignor had there been no assignment, provided that these defenses and set-offs are based on facts existing at the time of the assignment.” See Robert Lamb , case, above.

The power of the contract to restrict assignment is broad. Usually, contractual provisions that restrict assignment of the contract without the consent of the obligor are valid and enforceable, even when there is statutory authorization for the assignment. The restriction of the power to assign is often ineffective unless the restriction is expressly and precisely stated. Anti-assignment clauses are effective only if they contain clear, unambiguous language of prohibition. Anti-assignment clauses protect only the obligor and do not affect the transaction between the assignee and assignor.

Usually, a prohibition against the assignment of a contract does not prevent an assignment of the right to receive payments due, unless circumstances indicate the contrary. Moreover, the contracting parties cannot, by a mere non-assignment provision, prevent the effectual alienation of the right to money which becomes due under the contract.

A contract provision prohibiting or restricting an assignment may be waived, or a party may so act as to be estopped from objecting to the assignment, such as by effectively ratifying the assignment. The power to void an assignment made in violation of an anti-assignment clause may be waived either before or after the assignment. See our article on Contracts.

Noncompete Clauses and Assignments:

Of critical import to most buyers of businesses is the ability to ensure that key employees of the business being purchased cannot start a competing company. Some states strictly limit such clauses, some do allow them. California does restrict noncompete clauses, only allowing them under certain circumstances. A common question in those states that do allow them is whether such rights can be assigned to a new party, such as the buyer of the buyer.

A covenant not to compete, also called a non-competitive clause, is a formal agreement prohibiting one party from performing similar work or business within a designated area for a specified amount of time. This type of clause is generally included in contracts between employer and employee and contracts between buyer and seller of a business.

Many workers sign a covenant not to compete as part of the paperwork required for employment. It may be a separate document similar to a non-disclosure agreement, or buried within a number of other clauses in a contract. A covenant not to compete is generally legal and enforceable, although there are some exceptions and restrictions.

Whenever a company recruits skilled employees, it invests a significant amount of time and training. For example, it often takes years before a research chemist or a design engineer develops a workable knowledge of a company’s product line, including trade secrets and highly sensitive information. Once an employee gains this knowledge and experience, however, all sorts of things can happen. The employee could work for the company until retirement, accept a better offer from a competing company or start up his or her own business.

A covenant not to compete may cover a number of potential issues between employers and former employees. Many companies spend years developing a local base of customers or clients. It is important that this customer base not fall into the hands of local competitors. When an employee signs a covenant not to compete, he or she usually agrees not to use insider knowledge of the company’s customer base to disadvantage the company. The covenant not to compete often defines a broad geographical area considered off-limits to former employees, possibly tens or hundreds of miles.

Another area of concern covered by a covenant not to compete is a potential ‘brain drain’. Some high-level former employees may seek to recruit others from the same company to create new competition. Retention of employees, especially those with unique skills or proprietary knowledge, is vital for most companies, so a covenant not to compete may spell out definite restrictions on the hiring or recruiting of employees.

A covenant not to compete may also define a specific amount of time before a former employee can seek employment in a similar field. Many companies offer a substantial severance package to make sure former employees are financially solvent until the terms of the covenant not to compete have been met.

Because the use of a covenant not to compete can be controversial, a handful of states, including California, have largely banned this type of contractual language. The legal enforcement of these agreements falls on individual states, and many have sided with the employee during arbitration or litigation. A covenant not to compete must be reasonable and specific, with defined time periods and coverage areas. If the agreement gives the company too much power over former employees or is ambiguous, state courts may declare it to be overbroad and therefore unenforceable. In such case, the employee would be free to pursue any employment opportunity, including working for a direct competitor or starting up a new company of his or her own.

It has been held that an employee’s covenant not to compete is assignable where one business is transferred to another, that a merger does not constitute an assignment of a covenant not to compete, and that a covenant not to compete is enforceable by a successor to the employer where the assignment does not create an added burden of employment or other disadvantage to the employee. However, in some states such as Hawaii, it has also been held that a covenant not to compete is not assignable and under various statutes for various reasons that such covenants are not enforceable against an employee by a successor to the employer. Hawaii v. Gannett Pac. Corp. , 99 F. Supp. 2d 1241 (D. Haw. 1999)

It is vital to obtain the relevant law of the applicable state before drafting or attempting to enforce assignment rights in this particular area.

Conclusion:

In the current business world of fast changing structures, agreements, employees and projects, the ability to assign rights and obligations is essential to allow flexibility and adjustment to new situations. Conversely, the ability to hold a contracting party into the deal may be essential for the future of a party. Thus, the law of assignments and the restriction on same is a critical aspect of every agreement and every structure. This basic provision is often glanced at by the contracting parties, or scribbled into the deal at the last minute but can easily become the most vital part of the transaction.

As an example, one client of ours came into the office outraged that his co venturer on a sizable exporting agreement, who had excellent connections in Brazil, had elected to pursue another venture instead and assigned the agreement to a party unknown to our client and without the business contacts our client considered vital. When we examined the handwritten agreement our client had drafted in a restaurant in Sao Paolo, we discovered there was no restriction on assignment whatsoever…our client had not even considered that right when drafting the agreement after a full day of work.

One choses who one does business with carefully…to ensure that one’s choice remains the party on the other side of the contract, one must master the ability to negotiate proper assignment provisions.

Founded in 1939, our law firm combines the ability to represent clients in domestic or international matters with the personal interaction with clients that is traditional to a long established law firm.

English law assignments of part of a debt: Practical considerations

United Kingdom | Publication | December 2019

Enforcing partially assigned debts against the debtor

The increase of supply chain finance has driven an increased interest in parties considering the sale and purchase of parts of debts (as opposed to purchasing debts in their entirety).

While under English law part of a debt can be assigned, there is a general requirement that the relevant assignee joins the assignor to any proceedings against the debtor, which potentially impedes the assignee’s ability to enforce against the debtor efficiently.

This note considers whether this requirement may be dispensed with in certain circumstances.

Can you assign part of a debt?

Under English law, the beneficial ownership of part of a debt can be assigned, although the legal ownership cannot. 1 This means that an assignment of part of a debt will take effect as an equitable assignment instead of a legal assignment.

Joining the assignor to proceedings against the debtor

While both equitable and legal assignments are capable of removing the assigned asset from the insolvency estate of the assignor, failure to obtain a legal assignment and relying solely on an equitable assignment may require the assignee to join the relevant assignor as a party to any enforcement action against the debtor.

An assignee of part of a debt will want to be able to sue a debtor in its own name and, if it is required to join the assignor to proceedings against the debtor, this could add additional costs and delays if the assignor was unwilling to cooperate. 2

Kapoor v National Westminster Bank plc

English courts have, in recent years, been pragmatic in allowing an assignee of part of a debt to sue the debtor in its own name without the cooperation of the assignor.

In Charnesh Kapoor v National Westminster Bank plc, Kian Seng Tan 3 the court held that an equitable assignee of part of a debt is entitled in its own right and name to bring proceedings for the assigned debt. The equitable assignee will usually be required to join the assignor to the proceedings in order to ensure that the debtor is not exposed to double recovery, but the requirement is a procedural one that can be dispensed with by the court.

The reason for the requirement that an equitable assignee joins the assignor to proceedings against the debtor is not that the assignee has no right which it can assert independently, but that the debtor ought to be protected from the possibility of any further claim by the assignor who should therefore be bound by the judgment.

Application of Kapoor

It is a common feature of supply chain finance transactions that the assigned debt (or part of the debt) is supported by an independent payment undertaking. Such independent payment undertaking makes it clear that the debtor cannot raise defences and that it is required to pay the relevant debt (or part of a debt) without set-off or counterclaim. In respect of an assignee of part of an independent payment undertaking which is not disputed and has itself been equitably assigned to the assignee, we believe that there are good grounds that an English court would accept that the assignee is allowed to pursue an action directly against the debtor without needing the assignor to be joined, as this is likely to be a matter of procedure only, not substance.

This analysis is limited to English law and does not consider the laws of any other jurisdiction.

Notwithstanding the helpful clarifications summarised in Kapoor, as many receivables financing transactions involve a number of cross-border elements, assignees should continue to consider the effect of the laws (and, potentially court procedures) of any other relevant jurisdictions on the assignment of part of a debt even where the sale of such partial debt is completed under English law.

Legal title cannot be assigned in respect of part of a debt. A partial assignment would not satisfy the requirements for a legal assignment of section 136 of the Law of Property Act 1925.

If an assignor does not consent to being joined as a plaintiff in proceedings against the debtor it would be necessary to join the assignor as a co-defendant. However, where an assignor has gone into administration or liquidation, there may be a statutory prohibition on joining such assignor as a co-defendant (without the leave of the court or in certain circumstances the consent of the administrator).

[2011] EWCA Civ 1083

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Practical Law

Assignment of debt

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Debt Assignment and Assumption Agreement

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Debt Assignment and Assumption Agreement

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A Debt Assignment and Assumption Agreement is a document whereby one party (the "assignor") assigns their debt to another party (the "assignee"), and the assignee agrees to pay the debt to the assignor's creditor.

A Debt Assignment and Assumption Agreement presumes that there is a debt that the assignor needs to pay to the creditor . This debt could arise from any circumstance, including a loan or maybe an unpaid contract of sale or services . In any case, this debt is then assigned (or transferred) to the assignee who will now have the obligation to pay the creditor . The parties may also choose whether the entire debt will be assigned or only a portion of it.

This document offers the option of having the debt transferred to the assignee completely or that the assignor and the assignee will be liable for the debt together . In the first option, the creditor will no longer have the right to ask for payment from the assignor even if the assignee fails to pay. In the second option, the creditor should first ask for payment from the assignee and, if the assignee fails to pay, they can ask for payment from the assignor. Either way, the creditor should sign and agree to the terms of the Debt Assignment and Assumption Agreement.

How to use this document

The user should enter all the information necessary to complete the document. This includes the names and addresses of the assignor, the assignee, and the creditor, the total amount of the debt, and, if only a portion of the debt will be transferred, the amount that will be transferred. Once the document is completed, it should be carefully reviewed by all the parties and, if the document is correct, it should be signed by all the parties.

Each party should keep a copy of the document for their records.

Notarizing the document

If the parties would want to notarize the Debt Assignment and Assumption Agreement, the document also includes an Acknowledgment portion. Notarization of the document converts the document from a private document to a public document so that it becomes admissible in court without need of further proof of its authenticity.

To notarize the document, the parties must print and sign an extra copy (for the notary public) of the document and bring all the copies to a notary public to acknowledge that they have signed the Debt Assignment and Assumption Agreement freely and voluntarily . They should also present a valid I.D. issued by an official agency bearing their photograph and signature such as a driver's license or a passport, among others.

Notarizing this document is optional .

Once notarized, the parties should each keep at least one (1) copy of the notarized document and the notary public will also keep one (1) copy for their notarial book.

Applicable law

The laws on contracts and obligations under the Civil Code of the Philippines apply.

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Submission Guidelines

Assignment of Debts under the Insolvency and Bankruptcy Code

[ Aayush Mitruka is a lawyer based in Delhi]

Synergies Dooray Automotive, the first corporate entity to be resolved under the new Insolvency and Bankruptcy Code ( Code ) posed a few very interesting questions and highlighted some grey areas in Code. In the present post I intend to discuss one important issue that came up in the context of assignment of debts.

To put things in perspective, the Code stipulates that after the National Company Law Tribunal ( NCLT ) admits an insolvency application, the Insolvency Resolution Professional ( IRP ), among other things, constitutes a committee of creditors ( CoC ) on the basis of claims received against the corporate debtor. The committee comprises all the financial creditors of the corporate debtor, and they are assigned voting shares based on the size of their debt. However, a related party to whom a corporate debtor owes a financial debt does not have any right of representation, participation or voting in the meetings of the CoC.

Before discussing the issue, it will be beneficial to allude to the brief facts of the Synergies Dooray case. In November 2016, just a week before the Code became operational, Synergies Castings, a sister concern of Synergies Dooray, assigned a major portion of its debt to third-party Millennium Finance by way of three assignment deeds. Note that Synergies Castings had acquired the debt from a consortium of banks by way of a one-time settlement in 2011. In the usual course, Synergies Castings, being a related party would not have been permitted to participate/vote in the meetings of the CoC. Therefore, the maneuvering had secured Millennium Finance ( Millennium ) a place in the CoC.

Understandably, there is no reason to complain when a creditor (related party or otherwise) assigns its loan to somebody, as that is well within their rights. However the important question is whether the assignee should get a seat in the CoC by virtue of the assignment? The Code does not seem to directly provide any answer in this regard. [1]

This particular question came up for consideration in an application filed by Edelweiss Asset Restructuring Company Limited ( Edelweiss ) against Synergies Dooray. Edelweiss challenged the assignment and the constitution of the CoC (which included Millennium), alleging that the assignment of debt by Synergies Casting to Millennium was carried out with the ulterior motive of reducing its (i.e. Edelweiss’) voting rights. It was also argued that the assignment deeds were inadequately stamped and unregistered. However, Edelweiss’ argument did not find favour with the NCLT, Hyderabad and while rejecting the application, the NCLT remarked :

“29. Therefore, the assignment deeds between the two entities also legal and permissible. At most it can be said to be similar to “tax planning” rather tax avoiding. Because of this assignment deed, not only the applicant’s share in total debt is reduced, but other financial creditors/Assignees share also proportionately reduced and they did not object to the same but only the applicant agitates with oblique motive/reasons best known to it. Therefore, a fraudulent attempt made to reduce the Applicant’s share in the total voting rights is not a plausible plea by the Applicant. In the absence of any documentary proof/evidence to the claim of the Applicant, the same is liable to be rejected. Accordingly, the bench rejects the above allegations/claim of the applicant.”

[Emphasis supplied]

Although the NCLT held that such an assignment was legal and permissible, it did not delve into the critical aspect of whether such an assignment would secure the assignee a seat in the CoC. The reasoning provided does not appear very convincing. This question ought to have been discussed at length. A reading of the above quoted paragraph also brings to fore that the decision lends it approval to an assignment undertaken even with the sole objective of securing a seat in the CoC because it is akin to “tax planning”. Edelweiss has preferred an appeal before the NCLAT and the matter is currently pending for its decision.

This issue was once again considered by the NCLT, Mumbai in the case of Fortune Pharma Private Limited . Interestingly, in this case, after filing applications initiating the corporate insolvency resolution process ( CIRP ) but before its admission, two related party creditors assigned their debts to an unrelated third party. Naturally, this diminished the voting share of the applicant creditor, who then filed an application contending that the assignments were executed with an ulterior motive. The NCLT held that disqualification that existed at the time of initiating the CIRP cannot be removed by a mere assignment. It noted that assignment is transfer of one’s right to recover debt to another person and that the rights of the ‘assignee’ are no better than those of an ‘assignor’. Accordingly, the assignee does not get the right to change its status from ‘related’ to ‘unrelated.’

In other words, the NCLT, Mumbai reasoned that since at the inception of the debt it belonged to a related party (who is barred to participate in the proceedings of CoC), the assignment of such a debt will not remove the bar. In my view, though the NCLT was correct in debarring the assignee from participating in the proceedings of the CoC, however the reasoning provided does not appear to inspire much confidence because of the following reasons.

First, it is important to understand that the bar is on the person who is holding the debt and not the nature of the debt per se. It will not be entirely correct to bar somebody (who is otherwise eligible) from voting just because it bought the debt from a related party. Imagine a situation where an original creditor (unrelated) assigns a debt to a related party. Now when this related party creditor assigns a debt to an unrelated X in the usual course of business, will X in this case be barred since at some point in time the debt was held by a related party? The answer to this has to be in the negative.

Second, this will prove to be counter-productive and have unintended repercussions. It will strongly discourage genuine asset reconstruction companies or other interested parties from buying the debt from any related party creditor. Surely, the Code could not have intended to hinder assignments which are undertaken in the usual course of the business.

Third, how do we exactly deal with situations when a CIRP application is being made by an operational creditor under section 9 of the Code? An operational creditor needs to deliver to the corporate debtor a demand notice as per section 8 before invoking section 9. Do we, in these cases, also allow an assignment before filing of an application? It would be impractical to have a one-size-fits-all approach.

The two views and the approaches adopted by two benches of the NCLT on this critical question throws open a can of worms. Let us try to closely examine this issue.

Assignment is essentially a contractual concept and refers to an agreement by which the rights and obligations of one party can be transferred to another. By virtue of assignment, the assignee steps into the shoes of her assignor and agrees to be both bound by it and is entitled to enforce it. Further, to be valid, an assignment agreement must satisfy the requirements under the Indian Contract Act, 1872 ( Act ). Accordingly, an assignment agreement can be declared void under section 23 of the Act if the object of the assignment agreement is (a) of such a nature that, if permitted, it would defeat the provisions of any law; or (b) fraudulent; or (c) involves or implies injury to the person or property of another; or (d) the court regards it as immoral, or opposed to public policy.

At this juncture, it is significant to examine if the NCLT (which exercises summary jurisdiction) would have the power to undertake such an investigation or would it be the prerogative of a civil court? The language of section 60(5)(c) of the Code seem to suggest that the NCLT will have the authority since this will be a “ question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under this Code .”

It cannot be the intention of the Code to allow the promoters to appoint a proxy on the CoC by means of an assignment. It is a well settled principle of law that what may not be done directly cannot be permitted to be done indirectly. However, at the same time it must also be borne in mind that the Code does not aim to discourage any bona fide assignments. In the absence of any guidance in the Code, in order to determine the validity of such assignments, the NCLT ought to investigate the objective behind the assignment. In this regard, the time and the circumstances under which the assignment is made would be one relevant factor. Among other factors, the NCLT may also consider if the assignment is executed in the usual and ordinary course of the business.

This issue undermines the efficiency of the Code and therefore warrants serious consideration. The Code envisages provisions for scrutinizing certain transactions which may compromise the CIRP. One way to address this issue could be by amending the law to include such assignments also within its ambit. Pertinently, under section 240 of the Code, the Insolvency and Bankruptcy Board of India has the power to make regulations. However, since Parliament has been quite proactive in the past in preventing the promoters trying to game the system, it would not be surprising if an amendment is brought in to bring some clarity. It remains to be seen how and when this issue does gets finally elucidated.

– Aayush Mitruka

[1] Regulation 28 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 does not address this issue.

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Thanks for the above post. Its very helpful. Can you share a draft Assignment Agreement as per IBC?

Ad Mr Ayush. Sir.we have settlements our loans with J.M Arc on 12.8.15 in rs 7 Cr.J.M ARC not given permission to sell extra open land to deposit upfront 25% payments. Hence company not sine agreement. B.J.M ARC revoked on 11.12.15.J.M ARC file petition with NCLt for rs 14.5 cr in application. Pls advice your view.

With respect to Mr Mitruka’s views on the issue of assignment, I humbly submit that no amendment in the Code is called for. The Code, in several places, has expressly equated a creditor (by virtue of a business deal) with a creditor who has simply acquired a debt from another, say through assignment. Once the assignment agreement comes out unscathed, the assignee (of any debt) is as much a creditor as any other creditor. So, post the assignment, Millenium is a creditor in his own right. This way there is no question of any ‘related party’. A financial creditor gets a seat in the CoC, irrespective of his lineage. This should be looked at in this simple manner. In the proceedings before NCLT, Hyderabad, all that was said was that these 3 Agreements smacked of malafide because their date of signing was so close to the date of SICA Repeal . To be sure, I fail to see the connection between the two. It was known to all and sundry that SICA Repeal will be brought into force as soon as NCLTs got ready to be constituted.What was the fault of the Assignor or Assignee , even if agreements were signed on the very day on which SICA Repeal was made effective. Edelweiss does not appear to have led any evidence to show that the parties were planning to get around the section 21(2) by signing those assignment agreements. In fact, if the objective was just to get around this section, the date of signing did not need to be close to the date of SICA Repeal coming into effect. Neither NCLT nor the RP could afford to waste time on mere allegations unsupported by any evidence.

Please sir help…. Bank insolvency pr assignment ready krna h… So plz explain I am so very confused..

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COMMENTS

Debt Assignment and Assumption Agreement
This agreement must clearly establish the calendar date when the assignment of the debt to the Assuming Party becomes active. (2) Debtor Name And Mailing Address. The current Holder of the debt should be identified as the Debtor in this agreement. To this end, record the Debtor's name and address. (3) Assuming Party.
Debt Assignment: How They Work, Considerations and Benefits
Debt Assignment: A transfer of debt, and all the rights and obligations associated with it, from a creditor to a third party . Debt assignment may occur with both individual debts and business ...
Assignment Of Debt Agreement: Definition & Sample
An assignment of debt agreement is a legal document between a debtor and creditor that outlines the repayment terms. An assignment of debt agreement can be used as an alternative to bankruptcy, but several requirements must be met for it to work. In addition, if obligations are not met under a debt agreement, it might still be necessary to file ...
Debt Assignment and Assumption Agreement
A Debt Assignment and Assumption Agreement is a very simple document whereby one party assigns their debt to another party, and the other party agrees to take that debt on. The party that is assigning the debt is the original debtor; they are called the assignor. The party that is assuming the debt is the new debtor; they are called the assignee.
Assignment Of Debt: Definition & Sample
Assignment of debt is an agreement that transfer debt, rights, and obligations from a creditor to a third party. Assignment of debt agreements are commonly found when a creditor issues past due debt to a debt collection agency. The original lender will be relieved of all obligations and the agency will become the new owner of the debt.
PDF SAMPLE Debt Assignment and Assumption with Release
II. ASSIGNMENT OF DEBT. It is known that the Debtor is indebted to the Creditor, under a separate agreement, for the current principal sum of $150,000.00, plus any interest ("Debt"). Under this Agreement, the Assuming Party agrees to assume: (choose one) ☒ - All of the Debt. ☐ - Portion of the Debt. The Assuming Party agrees to assume ...
Understanding an assignment and assumption agreement
An assignment and assumption agreement is used after a contract is signed, in order to transfer one of the contracting party's rights and obligations to a third party who was not originally a party to the contract. The party making the assignment is called the assignor, while the third party accepting the assignment is known as the assignee. In ...
Free Assignment Agreement Template
Assignment Agreement Template. Use our assignment agreement to transfer contractual obligations. An assignment agreement is a legal document that transfers rights, responsibilities, and benefits from one party (the "assignor") to another (the "assignee"). You can use it to reassign debt, real estate, intellectual property, leases ...
Debt Assignment and Assumption Agreement
Article 2 - JOINT LIABILITY AND ASSUMPTION: While Assignee accepts and assumes responsibility for repayment of the Debt as outlined within this Agreement and within the original debt contract, attached herein, Assignor and Assignee will become jointly liable for the Debt to Creditor. Creditor shall initially seek repayment from Assignee, but if ...
What Is an Assignment of Contract?
An assignment of contract occurs when one party to an existing contract (the "assignor") hands off the contract's obligations and benefits to another party (the "assignee"). Ideally, the assignor wants the assignee to step into his shoes and assume all of his contractual obligations and rights. In order to do that, the other party to the ...
not as easy as first thought
In Promontoria (Henrico) Ltd v Melton [2019] EWHC 2243 (Ch) (26 June 2019), the High Court held that an assignment of a facility agreement and legal charges was valid, even though the debt assigned had to be identified by considering external evidence. The deed of assignment in question listed the assets subject to assignment, but was illegible ...
PDF Debt Assignment and Assumption with Release
II. ASSIGNMENT OF DEBT. It is known that the Debtor is indebted to the Creditor, under a separate agreement, for the current principal sum of $_____, plus any interest ("Debt"). Under this Agreement, the Assuming Party agrees to assume: (choose one) ☐ - All of the Debt. ☐ - Portion of the Debt. The Assuming Party agrees to assume $_____.
What is an Assignment of Debt?
An assignment of debt, in simple terms, is an agreement that transfers a debt owed to one entity, to another. A creditor does not need the consent of the debtor to assign a debt. Once a debt is properly assigned, all rights and responsibilities of the original creditor (the assignor) transfer to the new owner (the assignee).
Assignment of Debt Agreement Sample Contracts
Filed. January 19th, 2022. A Debt Assignment and Assumption Agreement is a very simple document whereby one party assigns their debt to another party, and the other party agrees to take that debt on. Applicable law Debt Assignment and Assumption Agreements are generally covered by the state law where the debt was originally incurred.
Contract Assignment Agreement
Contract Assignment Agreement. Last revision 01/31/2024. Formats Word and PDF. Size 2 to 3 pages. 4.8 - 105 votes. Fill out the template. This Contract Assignment Agreement document is used to transfer rights and responsibilities under an original contract from one Party, known as the Assignor, to another, known as the Assignee. The Assignor ...
Debt Collection Defense: Requiring That the Collector Document ...
Often such proof will be a bill of sale, an "assignment," or a receipt between the last creditor holding the debt and the entity suing you. Failure to State a Claim. Again, most states require credit companies or the debt collector collecting on the account to attach a complete set of documents to the complaint.
How Does Debt Assignment Work?
Debt assignment refers to a transfer of debt. This includes all of the associated rights and obligations, as it goes from a creditor to a third party. Debt assignment is essentially the legal transfer of debt to a debt collector (or debt collection agency). After this agency purchases the debt, they will have the responsibility to collect the debt, meaning you will pay your debt to them.
Assignments: The Basic Law
Assignments: The Basic Law. The assignment of a right or obligation is a common contractual event under the law and the right to assign (or prohibition against assignments) is found in the majority of agreements, leases and business structural documents created in the United States. As with many terms commonly used, people are familiar with the ...
Legal assignment
Legal assignment. The usual way of assigning the benefit of any debt or other legal thing in action under section 136 of the Law of Property Act 1925. Under that section, the basic requirements for a legal assignment are as follows: Only the benefit of an agreement may be assigned. The assignment must be absolute. The rights to be assigned must ...
ASSIGNMENT AND ASSUMPTION OF DEBT AGREEMENT
The Assignee assumes, covenants and agrees to be responsible for all obligations of the Assignor under the Letter Agreement and the Assignee agrees that it will be bound by the Letter Agreement as fully as if it had been an original party to the Letter Agreement. This Agreement will be read and construed together with the Letter Agreement, and ...
English law assignments of part of a debt: Practical considerations
While under English law part of a debt can be assigned, there is a general requirement that the relevant assignee joins the assignor to any proceedings against the debtor, which potentially impedes the assignee's ability to enforce against the debtor efficiently. ... although the legal ownership cannot. 1 This means that an assignment of part ...
Assignment of debt
Trust. 83% of customers are highly satisfied with Practical Law and would recommend to a colleague. Improve Response Time. 81% of customers agree that Practical Law saves them time. End of Document. Resource ID 1-100-2291. The assignment of debt in good faith is not invalid even if the necessity for litigation to recover it is contemplated by ...
Assignment and novation
Like assignment, novation transfers the benefits under a contract but unlike assignment, novation transfers the burden under a contract as well. In a novation the original contract is extinguished and is replaced by a new one in which a third party takes up rights and obligations which duplicate those of one of the original parties to the ...
Debt Assignment and Assumption Agreement
A Debt Assignment and Assumption Agreement presumes that there is a debt that the assignor needs to pay to the creditor. This debt could arise from any circumstance, including a loan or maybe an unpaid contract of sale or services. In any case, this debt is then assigned (or transferred) to the assignee who will now have the obligation to pay ...
Contracting Concepts: Assignment of Claims
Under the Assignment of Claims Act, a contractor may assign moneys due or meant to become due under a contract meeting all of the following conditions: (a) Contract payments are equal to or more than $1,000. (b) The assignment is made to a bank, trust company, or other financing institution. (c) The contract does not prohibit the assignment.
Accord and satisfaction
Accord and satisfaction is a contract law concept about the purchase of the release from a debt obligation. It is one of the methods by which parties to a contract may terminate their agreement. The release is completed by the transfer of valuable consideration that must not be the actual performance of the obligation itself. The accord is the agreement to discharge the obligation and the ...
Assignment of Debts under the Insolvency and Bankruptcy Code
In November 2016, just a week before the Code became operational, Synergies Castings, a sister concern of Synergies Dooray, assigned a major portion of its debt to third-party Millennium Finance by way of three assignment deeds. Note that Synergies Castings had acquired the debt from a consortium of banks by way of a one-time settlement in 2011.

Debt Assignment: How They Work, Considerations and Benefits

What Is Debt Assignment?

Key Takeaways

How Debt Assignments Work

Special Considerations

Benefits of Debt Assignment

Criticism of Debt Assignment

Assignment Of Debt

Common Sections in Assignments Of Debt

Assignment Of Debt Sample

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Understanding an assignment and assumption agreement

The assignment and assumption agreement

Assignment Agreement Template

What Is an Assignment Agreement?

Partnership Interest

Review the Contract Terms

Check for Anti-Assignment Clauses

Determine Assignability

Get Consent from the Other Party (if Required)

Prepare an Assignment Agreement

Include Original Contract Information

Execution of the Assignment Agreement

Notice to the Other Party

File the Assignment

Communicate with Third Parties

Keep Copies for Records

Step 1 – List the Assignor’s and Assignee’s Details

Step 2 – Provide Original Contract Information

Step 3 – State the Consideration

Step 4 – Provide Any Terms and Conditions

Step 5 – Obtain Signatures

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