What is a debt buyer, and why is a company I never borrowed from suing me?

You opened a credit card with a bank. Years later, a company called LVNV Funding or Portfolio Recovery Associates sues you. You have never spoken to them, never signed anything with them, and never received a bill from them. So how are they in court?

What a debt buyer is

A debt buyer is a company whose business is purchasing charged-off consumer accounts in bulk and collecting on them. When a bank decides an account will not be repaid, it charges it off, which is an accounting step, then sells it. Portfolios of thousands of accounts change hands for a small fraction of the face value.

The buyer then collects, sells the portfolio again, or files lawsuits.

The names you will see in a caption

• Midland Credit Management and Midland Funding, part of Encore Capital Group
• LVNV Funding, serviced by Resurgent Capital Services
• Portfolio Recovery Associates, part of PRA Group
• Cavalry SPV I, serviced by Cavalry Portfolio Services
• Unifund CCR
• Jefferson Capital Systems
• Crown Asset Management
• Absolute Resolutions Investments
• Credit Corp Solutions
• Velocity Investments

Some of these entities have almost no employees. They are holding companies that own receivables while a separate servicer does the collecting and a local law firm files the suits.

What the buyer actually receives in the sale

This is the part that matters in court. When a portfolio is sold, the buyer typically receives an electronic file: account numbers, names, addresses, balances, charge-off dates. It usually does not automatically receive:

• Your signed application or cardholder agreement
• The complete monthly statement history
• An itemization separating principal, interest, and fees
• Any documentation of the individual account beyond the data row

Sale agreements frequently disclaim the accuracy of the information and sell the accounts "as is," with the right to request a limited number of media documents later for an extra fee.

Why that creates a real defense

To win, a plaintiff has to establish standing — the right to sue on this specific account. Proving standing requires a documented chain of title: a bill of sale from the bank, an account-level schedule showing your account was in that sale, and an assignment for every subsequent transfer.

A bill of sale that says "Seller transfers the accounts described in Exhibit A" is worth nothing to the plaintiff if Exhibit A is missing, redacted, or does not include your account number.

Why the affidavit is not a substitute

Buyers close the gap with a sworn statement from one of their own employees, saying they reviewed business records and the balance is accurate. That signer did not open your account, did not generate your statements, and often has no first-hand knowledge of how the bank's systems worked. Courts differ on how much of that they accept, but the objection is legitimate and it is available to you.

What this means practically

You do not have to prove the debt is not yours. You file an Answer, deny what you cannot verify, raise lack of standing and broken chain of title as affirmative defenses, and serve discovery asking for the documents that would connect the account to the plaintiff.

Very often, the response to that discovery is what resolves the case.