Midland Credit Management Is Suing Me in Michigan — What Do I Do?

When you hear "Midland" in a debt collection context, it almost always refers to two related but legally distinct entities: Midland Credit Management Inc. ("MCM") and Midland Funding LLC. Both are wholly owned subsidiaries of Encore Capital Group, Inc. (NASDAQ: ECPG), one of the two largest publicly traded debt buyers in the United States. Encore is headquartered in San Diego, California.

The entity split matters. Midland Funding LLC holds the purchased debt portfolios — the legal owner of the receivable. MCM is the servicer that handles day-to-day collections. When you receive a collection letter, it is usually from MCM. When you are sued in Michigan, the named plaintiff is usually Midland Funding LLC.

Encore Capital purchases portfolios of charged-off consumer debt — primarily credit cards from Citibank, Chase, Bank of America, Capital One, HSBC, GE Money Bank, Washington Mutual, and Target (TD Bank).

In 2015, the CFPB and 47 state attorneys general — including Michigan — entered a consent order with Encore Capital Group for collecting on debts known or that should have been known to be inaccurate, suing consumers using false affidavits, and filing collection suits without adequate documentation. The order required Encore's subsidiaries to obtain documentation before suing.

Why this matters in Michigan: Michigan has several distinctive procedural protections for defendants — the MCL 600.2145 counter-affidavit rule, the MCL 600.8407(1) bar on debt buyers in Small Claims, and the Brownbark II rule on bulk assignments. The exact documentation gaps the 2015 consent order targeted map directly onto these Michigan defenses.

If you were just served with a complaint from Midland Funding in Michigan Circuit Court or District Court, here is what almost certainly happened. You fell behind on a credit card or other consumer account. The original creditor wrote the account off and sold it as part of a portfolio to Encore Capital, which placed the accounts on Midland Funding LLC's books.

Michigan defendants get a procedural advantage that defendants in many states do not have: under MCL 600.8407(1), debt buyers (assignees) are barred from the Small Claims Division entirely. Midland must file in District Court General Civil where you have full discovery rights.

In Michigan, a default judgment carries serious consequences. Midland can garnish up to 25% of your disposable earnings, issue periodic garnishments on your bank account, and pursue other collection remedies.

Michigan gives you twenty-one days to file your Answer after you were served, if you were served within Michigan. This deadline is set by MCR 2.108(A)(1). If you were served outside Michigan, you have twenty-eight days under MCR 2.108(A)(2).

Did Midland attach a sworn "affidavit of amount due" to the complaint? If they did, the affidavit becomes prima facie evidence of the amount owed UNLESS you file a sworn counter-affidavit with your Answer under MCL 600.2145.

Michigan has strong procedural rules requiring debt buyers to plead and prove the assignment of the underlying debt. Under MCR 2.201(B) and Michigan common law going back to Masterspark Co. v. Hickerson, 211 Mich. 411 (1920), an assignee plaintiff must plead the assignment in the body of the complaint, not merely allege ownership.

The leading modern case is Brownbark II LP v. Bay Area Floorcovering, 295 Mich. App. 248 (2011). The Michigan Court of Appeals held that a generic block assignment without account-level identification is insufficient. The plaintiff must show that the specific account at issue was transferred — not just that some bulk transaction occurred.

The Midland Funding / MCM entity split makes this defense particularly potent in Michigan. Midland Funding LLC is the named plaintiff and the legal owner of the debt portfolio. MCM is the servicer. Under MCR 2.201(B), the assignment must be pleaded as ending in Midland Funding LLC specifically — the named plaintiff. Under Brownbark II, the assignment must identify the defendant's account specifically.

The records used to satisfy MCR 2.201(B) and Brownbark II are typically maintained by MCM as servicer, not by Midland Funding LLC as owner. Under MRE 803(6) (the business-records exception), the custodian who authenticates the records must lay foundation showing personal knowledge of how the records were created and kept. An MCM employee almost never has personal knowledge of how Citibank or Chase generated and stored its original account data. The MCM custodian is not testifying about MCM's own records when she authenticates a Citibank statement; she is purporting to authenticate Citibank's records, which she has no personal knowledge of.

In practice, Midland complaints filed in Michigan often fall short. The chain of assignment is often presented as a generic block transfer of thousands of accounts. The specific account number is often not tied to the bills of sale. The original cardholder agreement is often not attached. Each defect supports a motion for summary disposition under MCR 2.116(C)(8) or (C)(10).

This maps directly onto the 2015 Encore consent order, which required Encore's subsidiaries to obtain the original cardholder agreement and account-level transfer files before suing.

For credit card debt and most consumer accounts in Michigan, the statute of limitations is six years under MCL § 600.5807. The clock starts running on the date of your last payment.

If you made your last payment in March 2018, the six-year clock began on that date and expired in March 2024. A lawsuit filed in late 2024 would be filed outside the limitations period and would be time-barred. If you cannot remember when you last paid, look at your old credit reports — payment history is usually visible going back several years — or request the original creditor's account records.

The statute of limitations in Michigan is an affirmative defense that must be raised in your Answer or it is waived. Under MCR 2.111(F), affirmative defenses must be specifically pleaded in your responsive pleading.

This defense is unusually important in Midland cases because the 2015 Encore consent order specifically addressed Encore's subsidiaries' practice of suing on time-barred debts. Encore was required to refrain from suing on debts past the SOL and to disclose to consumers when a debt was time-barred. Midland complaints in Michigan nonetheless continue to surface accounts at the edge of the SOL — calculate your dates carefully.

Michigan's 6-year SOL is on the longer end nationally, but the assignment-pleading defenses under MCR 2.201(B), the small-claims bar under MCL 600.8407(1), and the affidavit/counter-affidavit rule under MCL 600.2145 give Michigan defendants strong tools beyond just the time-bar defense.

Most credit card agreements contain a clause requiring that any dispute be resolved through binding arbitration administered by AAA or JAMS. When Midland Funding bought your account, they bought it subject to whatever terms were in the original cardholder agreement.

Michigan has unusually strong rules favoring arbitration motions. The Michigan Uniform Arbitration Act (MCL 691.1681 et seq.) requires the trial court to stay litigation pending arbitration when a valid arbitration clause exists. Under MCL 691.1687(1), the stay is mandatory — the court has no discretion to refuse it once it finds a valid clause.

This is a powerful defense for Michigan Midland defendants. AAA and JAMS commercial filing fees for a business claimant typically run from $1,500 to $5,000 or more, plus the arbitrator's hourly fees. If the disputed debt is, say, $3,200, the cost of arbitration may exceed the recoverable amount.

When a Michigan defendant files a motion to compel arbitration — and the court grants it under MCL 691.1687 — Midland must choose between paying thousands in arbitration filing fees or abandoning the case. They very often abandon, which can result in a dismissal.

To use this defense, you generally need a copy of the original cardholder agreement showing the arbitration clause. Pair the arbitration motion with an MCR 2.116(C)(8) attack on the assignment pleading and a Brownbark II chain-of-title defense for maximum leverage.

Your Answer is the most important document you will file in this case. A good Answer in Michigan does three things: it admits or denies each numbered allegation under MCR 2.111(C), it raises every applicable affirmative defense under MCR 2.111(F)(2), and — where appropriate — it raises a counterclaim.

For the admit-or-deny portion: do not admit anything you do not actually know. If Midland alleges that you owed Citibank $3,217.42 as of a charge-off date you do not remember, deny that allegation for lack of knowledge.

The affirmative defenses to consider in a Michigan Midland Answer include lack of standing or chain of title under MCR 2.201(B) and Brownbark II (with particular attention to the MCM/Midland Funding entity split and the foundation problems an MCM custodian faces under MRE 803(6)); statute of limitations under MCL § 600.5807; failure to state a claim under MCR 2.116(C)(8); account stated cannot be established; arbitration clause; and Small Claims jurisdiction violation under MCL 600.8407(1) if Midland improperly filed in Small Claims.

The most important Michigan-specific item: if Midland attached a sworn "affidavit of amount due" to the complaint, you MUST file a sworn counter-affidavit with your Answer under MCL 600.2145. If you do not, the affidavit becomes prima facie evidence of the amount owed — handing Midland one of the elements of their case for free. Many pro se defendants miss this step. Do not.

Where FDCPA violations are present — and the 2015 Encore consent order makes these unusually likely — consider an FDCPA counterclaim in federal court for statutory damages plus attorney's fees.

Michigan has several consumer protection statutes that apply to Midland cases. The Michigan Collection Practices Act, codified at MCL §§ 445.251–445.258, regulates collection practices and provides a private right of action under § 445.257 for actual damages, statutory damages of up to $50, and attorney's fees.

The Michigan Occupational Code (MCL § 339.901 et seq.) requires collection agencies operating in Michigan to be licensed. Unlicensed collection by an out-of-state debt buyer can support a defense to the suit and a private right of action for damages.

The Michigan Consumer Protection Act (MCL §§ 445.901 et seq.) prohibits unfair or deceptive practices in trade or commerce, with private actions for actual damages plus attorney's fees. Application to debt collection is more limited than under the FCEUA in Pennsylvania or the CSPA in Ohio, but it can be relevant where the conduct is independently deceptive.

The federal FDCPA also applies to MCM (the servicer) and Midland Funding (the owner). FDCPA violations entitle you to up to $1,000 in statutory damages plus attorney's fees in federal court. The CFPB findings against Encore Capital — Midland's parent — establish that Encore's subsidiaries collected on inaccurate debts, used false affidavits in court, and filed collection suits without adequate documentation. Those findings are direct evidence of FDCPA-violative conduct.

The combination of Michigan's assignment-pleading rules, the small-claims bar, the mandatory arbitration stay, FDCPA counterclaim availability, and Encore's 2015 multi-state consent order means Midland faces real downside risk in Michigan cases.

After you file your Answer with the Michigan court clerk and serve a copy on Midland's attorney, the case enters discovery. Discovery in Michigan is governed by MCR 2.301 and following, and gives each side broad rights to request documents and information.

In a Midland case, this is where the chain-of-title defense gets tested. You can serve a request for production of documents under MCR 2.310 demanding every assignment document, every bill of sale, the original cardholder agreement, and the complete account history. Midland must respond within twenty-eight days. If they cannot produce a clean chain of title and an authenticated account record satisfying MCR 2.201(B) and Brownbark II — including resolving the MCM/Midland Funding custodian-of-records issue — their case is in serious trouble.

What very often happens next is a settlement offer. Michigan practitioners report that Midland commonly settles real-Answer cases for forty to sixty cents on the dollar.

If the case does not settle, it proceeds to a court date. Cases under $7,000 would normally be in Small Claims — but MCL 600.8407(1) bars debt buyers from that division, so Midland cases land in District Court General Civil, where you have full discovery rights and a more robust procedural environment.

Answered is a self-help legal platform built specifically for pro se defendants in consumer debt collection lawsuits. The Michigan playbook was reviewed by a Michigan-licensed consumer-rights attorney and is built around the specific statutes and rules that govern Midland cases — MCR 2.108(A)(1), MCR 2.111(F)(2), MCR 2.201(B), MCL 600.2145, MCL 600.5807, MCL 600.8407(1), MCL 691.1687, and Brownbark II.

When you upload your summons and complaint, Answered does the following: it extracts your service date and your 21-day Answer deadline; it identifies the Midland Funding / MCM entity split that drives most chain-of-title attacks in Michigan; it scans for the procedural defects most commonly found in Midland pleadings, including missing assignment pleading under MCR 2.201(B), generic block-assignment defects under Brownbark II, and missing original cardholder agreement; it checks whether Midland attached an "affidavit of amount due" requiring a counter-affidavit under MCL 600.2145; it identifies whether your debt may be time-barred under the six-year SOL of MCL 600.5807; it checks whether Midland improperly filed in Small Claims in violation of MCL 600.8407(1); it checks whether an arbitration clause is likely available under MCL 691.1687; and it generates a court-ready Answer with the affirmative defenses that apply.

The Answer document is formatted for Michigan Circuit Court or District Court General Civil, includes the proper caption and case style, and contains the affirmative defenses and (where applicable) the sworn counter-affidavit under MCL 600.2145.

Pricing is simple: free to start, and a one-time $99 charge to unlock and download your final documents. There is no subscription. There is no per-document fee.