Dealing with Gurstel Law Firm? What you need to know.

Who is Gurstel law firm?

The Gurstel Law Firm is a debt collection law firm headquartered in Golden Valley, Minnesota. Their lawyers routinely appear in court throughout Minnesota and also handle debt collection cases in Arizona, California, Iowa, Nebraska, Nevada, Utah, and Wyoming.

Gurstel does collection work for some of the largest banks, credit card companies, and debt buyers in the country. They are aggressive and very effective at recovering money for their clients.

What to do if you’re being sued by gurstel

If you’re dealing with a debt collection lawsuit from Gurstel, you typically have three options: (1) defend the case; (2) negotiate a settlement; or (3) file bankruptcy.

It’s critical to familiarize yourself with the court process. The lawyers at Gurstel know the court rules very well and will use your lack of familiarity to their advantage in pursuing a court judgment against you. Our free Minnesota Debt Collection Lawsuit Guide is a great place to start learning more about the process.

What to do if you’re being garnished by gurstel law firm

If Gurstel is garnishing your bank account or wages, there are four possible ways to stop the garnishment: (1) claim an exemption; (2) negotiate a settlement; (3) vacate the judgment; or (4) file bankruptcy.

When dealing with a garnishment from Gurstel, knowledge about the process and the pros and cons of each potential solution is critical. Our free Minnesota Garnishment Guide will get your started.

Need help dealing with Gurstel Law Firm?
Schedule a consult with debt defense lawyer Todd Murray.

Since 2009, Todd has helped hundreds of Minnesotans dealing with debt collection by Gurstel Law. His work has saved his clients lots of money and many sleepless nights. Todd’s clients describe him as “very professional and easy to work with.” He lives in Minneapolis with his wife and four children.

The Minnesota Garnishment Guide: Part 1—Garnishment Basics

This is part one of a four-part series about garnishment in Minnesota:

Part 2—How to Stop Garnishment
Part 3—Claiming Garnishment Exemptions
Part 4—Wrongful Garnishment

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What is garnishment?

If your paycheck suddenly shrank or your bank account was frozen, you may have been hit with a garnishment. This is one of the most stressful moments Minnesota consumers face.

Garnishment allows debt collectors to take money directly from your wages or bank account to pay a debt. Although Minnesota law technically permits garnishment before a judgment, most garnishments happen after a court has entered a judgment against you.

Collectors must follow strict legal procedures, and when they don’t, the garnishment may be wrongful or even illegal.

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Bank Garnishment Basics

Here’s how bank garnishment works:

• A debt collector sends a garnishment summons to your bank.

• On the day the bank processes it, the bank must freeze and seize the money in your account.

• You don’t get advance notice — you only learn after the money is taken.

This can cause overdrafts, bounced checks, and other financial chaos. Minnesota law gives you some protections, but you have to act quickly to claim them.

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Wage garnishment basics

Wage garnishment starts with a Notice of Intent to Garnish sent to you. The debt collector must then wait 10 days before sending a garnishment summons to your employer.

Once your employer receives the summons, they must take up to 25% of your after-tax wages each pay period until the debt is paid.

For many Minnesota workers, this means losing hundreds of dollars from every paycheck.

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What’s Next in This Series

This is Part 1 of our Minnesota Garnishment Guide. Next, we cover:

Part 2—How to Stop Garnishment
Part 3—Claiming Garnishment Exemptions
Part 4—Wrongful Garnishment

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Ready to talk to a lawyer about garnishment?
Schedule a consult with debt defense lawyer Todd Murray.

Since 2009, Todd has helped hundreds of Minnesotans defend garnishments. His work has saved his clients millions of dollars (and many sleepless nights) in the process. Todd’s clients have described him as “very professional and easy to work with.” He lives in Minneapolis with his wife and four children.

The Minnesota Garnishment Guide: Part 2—How to Stop Garnishment

This is part two of a four-part series about garnishment in Minnesota:

Part 1—Garnishment Basics
Part 3—Claiming Garnishment Exemptions
Part 4—Wrongful Garnishment

How to Stop a Garnishment in Minnesota

There are four ways to stop a garnishment in Minnesota: (1) claim an exemption; (2) negotiate a settlement; (3) vacate the judgment; and (4) file bankruptcy. Here’s an in-depth look at each of these options.

Option #1: If you get need-based assistance, claim an exemption

The first way to stop a garnishment in Minnesota is to claim an exemption. Exemptions are legal reasons why your paycheck or bank account are protected from garnishment. Exemption laws vary by state. In Minnesota, some common exemptions are:

• Creditors cannot take your social security or other need-based government aid from your bank account.

• If you received need-based government aid within the last 6 months, your wages cannot be garnished at all.

• In most other cases, creditors can only take 25% of your paycheck.

Important caveat: if you’re being garnished for child support, alimony, or many types of government debt (including federal student loans) the rules are different. 

WHO IS CLAIMING AN EXEMPTION THE RIGHT OPTION FOR?

Anyone who qualifies for it. If your circumstances allow, you should assert your exemption to stop the garnishment and get your money back. But remember, claiming an exemption doesn’t make the debt go away, it just means that your money is protected from garnishment for the time being.

Option #2: If you can afford it, negotiate a settlement

A second way to stop a garnishment is to negotiate a settlement with the collector. The idea here is to get the creditor to stop the garnishment in exchange for voluntary payment.

WHO IS DEBT SETTLEMENT THE RIGHT OPTION FOR?

Anyone who can afford to pay a reasonable settlement to fully resolve the debt. If you have many debts and can’t realistically afford to settle all of them, this option probably isn’t the best choice for you.

Also, keep in mind that if the creditor is garnishing your wages for, say, $250 a month, they’re not going to agree to a voluntary settlement where you pay $100 a month. Your best bet to settle when a wage garnishment is already in place is to see if the creditor will take a lump sum payment for less than the full balance. Some creditors prefer the certainty of having some money right away rather than waiting months to get paid in full through garnishment.

Option # 3: If you meet the necessary criteria, vacate the judgment.

Another way to stop a garnishment is to vacate (undo) the underlying court judgment. If you take away the judgment, you take away the right to garnish.

To vacate a judgment in Minnesota, you’ll have to convince the judge that you have a really good reason for not responding to the creditor’s lawsuit and that you have a defense to the creditor’s claim. Further, in most cases you have to vacate the judgment within a year of its entry. 

WHO IS VACATING A JUDGMENT THE RIGHT OPTION FOR?

Anyone who didn’t receive the creditor’s lawsuit or who had a really good reason for not responding to it. For a couple of reasons, though, this is a long-shot option for most people.

• First, you must provide strong evidence that you never received the creditor’s lawsuit or that you had a good reason for not responding. Just telling the judge “I never got it” or “I didn’t know I needed to respond” isn’t going to cut it. 

• Second, you have to show the court that you have a valid defense to the debt. 

• Third, while vacating a judgment stops a garnishment in the short term, the debt doesn’t go away--you just go back to the beginning of the case. 

Because of these challenges, the vast majority of people would be better off choosing one of the other three options to stop a garnishment.

Option # 4: If you have other debts, consider filing bankruptcy

The fourth way to stop a garnishment is to file bankruptcy. Bankruptcy stops wage garnishments and bank levies immediately and may allow you to get the garnished money back. Plus, unlike claiming an exemption or vacating the judgment, bankruptcy also wipes out the debt itself in most cases.

Who is bankruptcy the right option for?

Anyone who has multiple debts. While you might be able to settle one or two accounts, chances are you’re not going to be able to settle multiple debts unless you have access to significant amounts of money.

What’s Next in This Series

This is Part 1 of our Minnesota Garnishment Guide. Next, we cover:

Part 1—Garnishment Basics
Part 3—Claiming Garnishment Exemptions
Part 4—Wrongful Garnishment

Ready to talk to a lawyer about garnishment?
Schedule a consult with debt defense lawyer Todd Murray.

Since 2009, Todd has helped hundreds of Minnesotans defend garnishments. His work has saved his clients millions of dollars (and many sleepless nights) in the process. Todd’s clients have described him as “very professional and easy to work with.” He lives in Minneapolis with his wife and four children.

The Minnesota Garnishment Guide: Part 4—Wrongful Garnishment

This is part four of a four-part series about garnishment in Minnesota:

Part 1—Garnishment Basics
Part 2—How to Stop Garnishment
Part 3—Claiming Garnishment Exemptions

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What is Wrongful Garnishment?

The Fair Debt Collection Practices Act prohibits debt collectors from doing anything that is unfair, untrue, harassing, or abusive. It also forbids debt collectors from taking action that they can’t legally take. Here are some typical FDCPA violations related to garnishments:

Making false statements in the garnishment paperwork

This could include things like: (1) claiming that they have a judgment when they don’t; (2) misstating the balance due; (3) incorrectly describing possible exemptions; and (4) instructing your employer to hold money longer than allowed (in Minnesota, 180 days).

continuing to garnish when the collector knows you’re exempt

If you’ve claimed a valid garnishment exemption and given the debt collector complete proof of your exemption, it’s illegal for them to continue with the
garnishment process. This includes making you appear at an exemption hearing when the collector already has proof of your exemption.

Threatening to garnish all of your wages

In Minnesota, a debt collector can only garnish 25% of your wages. So if a collector is lying if they threaten to garnish 100% of your wages.

garnishing for a debt you’ve already paid

If you’ve already paid the debt in full, you can’t be garnished for more money. Similarly, if you’ve negotiated a payment plan to resolve a debt and you’re current on that payment plan, a debt collector can’t garnish you.

Court judgment was vacated

Most garnishments happen after a court judgment has been entered. What if the court judgment is vacated, though? If the collection judgment is wiped out, then the collector's power to conduct a garnishment is wiped out.

Improper pre-judgment garnishment

Although most Minnesota garnishments happen after a judgment has been entered, the law does allow pre-judgment garnishments in limited circumstances. The way to tell if it’s a prejudgment garnishment is to look at the case caption. If there’s a judgment, it will list the court file number and date of the judgment. If there isn’t a judgment, it will say something like “subject to Minnesota Statutes 571.71, subd. 2.”

Debt collectors occasionally mess up this process. I've seen cases where they do a pre-judgment garnishment even though the defendant has answered the lawsuit. I've also seen cases where they garnish without sending the Notice of Intent to Garnish.

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You Can Sue for Wrongful Garnishment

If a debt collector violates the FDCPA through a wrongful garnishment, you can sue them and hold them accountable for their illegal conduct. You can sue even if you owe the debt. If you win the case, you get: (1) $1,000 in statutory damages; (2) any provable actual damages--such as out-of-pocket loss or emotional distress; (3) the collector has to pay your attorney fees; and (4) the collector has to pay your court costs. Most consumer rights attorneys take FDCPA cases on contingent fee arrangements, which means you don’t have to pay any attorney fees up front.

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What’s Next in This Series

This is Part 4 of our Minnesota Garnishment Guide. Next, we cover:

Part 1—Garnishment Basics
Part 2—How to Stop Garnishment
Part 3—Claiming Garnishment Exemptions

Ready to talk to a lawyer about garnishment?
Schedule a consult with debt defense lawyer Todd Murray.

Since 2009, Todd has helped hundreds of Minnesotans defend garnishments. His work has saved his clients millions of dollars (and many sleepless nights) in the process. Todd’s clients have described him as “very professional and easy to work with.” He lives in Minneapolis with his wife and four children.

How to answer interrogatories in a debt collection lawsuit

In the past, I've written about the importance of answering a debt collection lawsuit. But answering the lawsuit is only the first step. After the debt collector receives your answer, they'll usually send you written discovery. The discovery will probably have interrogatories, requests for production of documents, and requests for admission. In Minnesota, it's critical that you respond to each of these things within 30 days of receiving them.

This post focuses on how to respond to interrogatories. Interrogatories are simply just questions about the case. Debt collectors are allowed to ask about anything that is relevant to their claims or your defenses. Do your best to answer each question. If you don't understand what the interrogatory is asking, then you may answer that you object to the interrogatory as vague or ambiguous. Your answers to each interrogatory are due within 30 days. Unlike requests for admission, it's not fatal to your case if you don't answer within this time. But you should make every effort to answer within 30 days and you should never just ignore the interrogatories.

A final word of caution: there are many forms available online that seemingly can be used to answer debt collection discovery. But before you just copy and paste from the internet, make sure you understand what the form answers mean and whether they apply to the discovery requests for your case. And be careful with objections. Unless you understand what an objection means and are relatively sure it applies to the question you've been asked, it's probably best to just answer the question.

What is a summary judgment motion?

A summary judgment is a final decision by the court without having a trial. Debt collection lawsuits rarely go to trial and most are decided on a motion for summary judgment. The purpose of a trial is to resolve the facts that are disputed. In other words, the jury listens to all the witnesses’ testimony, reviews any exhibits, and decides whose story is more believable. When someone brings a summary judgment motion, they're arguing that all the important facts are undisputed, so there's no need for a jury to hear testimony and that the judge should just apply the law and make a decision. In debt collection cases, the creditor usually brings the summary judgment motion.

So what should you do if the debt collection lawyer brings a summary judgment motion in your case? First, you need to figure out if there are any facts that are disputed. If there are, the judge should deny the summary judgment motion and schedule the case for trial to resolve those disputed facts. If you come up with some, you'll need to put them in your response to the creditor's motion. In Minnesota, a response to a summary judgment motion must be filed with the court—and sent to the creditor's attorney—at least 14 days before the hearing. If you don't file a written response, you'll probably lose the case and the judge might not allow you to make any oral arguments at the hearing.

A summary judgment motion is probably the most difficult phase of a debt collection lawsuit for a non-lawyer to handle. You should strongly consider talking to a lawyer with experience defending debt collection lawsuits.

Who is National Collegiate Student Loan Trust?

Over the last few years, National Collegiate Student Loan Trust has brought hundreds of debt collection lawsuits against Minnesota citizens. If you've been sued by National Collegiate Student Loan Trust, here's what you need to know.

Who is National Collegiate Student Loan Trust?

NCSLT doesn't lend money. It's merely a series of trusts that contain a pool of hundreds of private student loans. The loans have been packaged together and sold as investment vehicles. If this sounds similar to the way mortgages are handled, it should.

There are several National Collegiate Student Loan Trusts. They are typically named with the year the loan was originated. For example, most of the cases I'm seeing lately involve National Collegiate Student Loan Trust 2007.  I've also seen loans held by National Collegiate Student Loan Trust 2005 and 2006.

How do the student loans get into these trusts?

First, a bank issues a student loan to help someone pay for college. The bank then sells the loan to an entity called National Collegiate Student Loan Funding. This entity is merely a holding company that deposits all of the student loans into the individual trusts. Once the loans are packaged into trusts, bonds are sold to investors. The investors receive money based on the amount of money collected from student loan borrowers.

The trusts themselves don't actually service the loans and collect the payments. They hire someone, called a servicer, to do that for them. In most of the cases I've seen, the servicer is U.S. Bank.

Another interesting element of these trusts is that the loans are partially guaranteed. This means that the investors basically have an insurance policy when student loan borrowers aren't able to make payments. If the borrower defaults, the guarantor steps in and covers the payment.

What should I do if I'm sued by National Collegiate Student Loan Trust?

In my experience, it's difficult to negotiate a reasonable payment plan with National Collegiate Student Loan Trust. They demand that the borrower hand over a bunch of sensitive financial documents, such as tax returns and pay stubs before they'll even consider a settlement offer. And the offers that they make are rarely affordable. To avoid this frustrating experience, I've been advising people to fight back against the lawsuit by answering it and challenging NCSLT's proof in court.

National Collegiate Student Loan Trust can usually prove that they acquired a pool of loans from the originating bank. But, in my experience, they rarely have sufficient proof that they own your loan. There are other ways to challenge the sufficiency of their evidence and, depending on the specific facts involved, you may have other defenses as well. We've been successful getting NCSLT cases thrown out of court and have negotiated very favorable payment plans by pushing back.

How to kill 'zombie debt' using the statute of limitations

They call it zombie debt because it's so old that by the time a debt collector picks it up, you've totally forgotten about it. Creditors sell old, uncollected debt to debt buyers for pennies on the dollar--that's why you may be getting phone calls or letters on a debt you don't even remember having. Just as there are very specific ways to kill a zombie (click here only if you don't scare easily), there are specific defenses you may have against zombie debt. One of these is the statute of limitations.

Statute of limitations: The statute of limitations is the legal term for how long a party can sue you on a debt. The statute of limitations for suing for breach of a credit card contract in Minnesota is six years. This means that a creditor or debt buyer can sue you anytime up to six years from the date of your last purchase or last payment, whichever was later. There are some exceptions to this, so you'll want to consult an attorney.

Special statute of limitations: There may be a shorter statute of limitations if the debt was a store credit card. It's a store card if you could only use it at one store (store-branded cards with Visa or Mastercard logos don't count.) Those lawsuits are governed by a different law, called the Uniform Commercial Code (UCC), and they may have a shorter statute of limitations of only four years.

Super-special bonus statute of limitations: Minnesota has a borrowing statute. In short, this means that if a legal claim "arises" in another state with a shorter statute of limitations, that shorter statute of limitations may apply. This may be relevant for credit card companies based in states such as Delaware, which has a three-year statute of limitations. But be warned, the law is tricky on this. We would recommend you only try this defense under supervision of an experienced attorney.

Fighting debt collectors vs. filing bankruptcy

We make a point of not selling any particular service to our clients. We're here to listen to your story and then lay out the different options you may have. Often, consumers call us when they've been sued by a creditor. Getting sued is a scary thing and the person sitting across the table from us is often nervous and upset.  We do our best to take fear out of the equation and get focused on reaching a resolution. In a situation like this, we generally start with a few questions, like:

-Do you actually owe the debt claimed in the lawsuit?

-Does the amount demanded in the suit seem like approximately what you thought you owed to this creditor?

-Who is suing you (original creditor or debt buyer)?

We'll then turn to a more holistic discussion of your situation. In order to set forth your options we will need to learn about your work situation, your monthly obligations, your assets and your other debts (are you at a point where other creditors may sue you?). We will also ask about your future plans. If you're planning to buy a house or a new car in the near future and will require the ability to get new credit, that will impact the way you deal with the suit.

In any case, your unique situation will determine what options are open to you, but the two most common remedies our clients choose are defending/settling the lawsuit or filing bankruptcy.

Defending a lawsuit: If you are interested in defending the lawsuit, we will determine what defenses and potential counterclaims you have. Sometimes we can develop counterclaims that really turn the table on the creditors. We will let you know if we think your case has that potential and give you our opinion on the strengths and weaknesses of the creditor's claims. We can also discuss whether it makes the most sense for you to litigate the case or try to settle it.

Bankruptcy: You can find more detailed information on the bankruptcy process here.

If you are facing suits from multiple creditors we can discuss whether a bankruptcy, either Chapter 7 or Chapter 13, makes more sense than fighting a series of lawsuits. In terms of legal fees, it costs about the same to hire us to file a Chapter 7 bankruptcy as it does for us to defend one debt collection suit. Of course there are ramifications either way, but rest assured that we'll discuss them at length with you and help you make the best decision.

What is an Order for Disclosure?

When a creditor obtains a judgment in Minnesota, they can request that the court send you a form called an Order for Disclosure or OFD. The form asks you where you work, how much you make, where you bank, and other questions about your assets. The purpose is to allow the creditor to discover what assets you have that may allow you to pay the judgment.

But here is the critical part:  you MUST fill out the OFD and return it to the creditor within 10 days. If you don't, then the creditor can go to a judge and ask the judge to issue a bench warrant for your arrest. That's right, they can haul you to jail for not filling out a form. So if you get an Order for Disclosure in the mail, make sure you truthfully fill it out and return it. Not every debt collector will seek a bench warrant for failure to return an OFD, but some will and you don't want to spend time in jail just for failing to fill out a form.