Gurstel Law Firm is a debt collection law firm that sues people over unpaid debts.
And yes, they can garnish your wages. But only after they sue you and win a court judgment.
If you received a letter from Gurstel Law Firm, this isn't a typical collection agency contact. This is a law firm threatening legal action. They represent creditors who want their money back through the court system.
As the owner of a leading credit repair company in Texas, I see Gurstel Law Firm cases weekly. Clients come in panicked after receiving lawsuit papers. They ignored collection calls for months. Now they're facing court dates and potential wage garnishment.
Gurstel Law Firm operates differently from regular debt collectors. They don't just call and send letters. They file lawsuits. They obtain judgments. They garnish wages and freeze bank accounts.
Understanding who they are and how they operate protects you from making costly mistakes.
Let me explain exactly what Gurstel Law Firm does and what options you have when they contact you.
Who Is Gurstel Law Firm?
Gurstel Law Firm is a debt collection law firm based in Minnesota with offices across multiple states.
Founded in 1999, they specialize in collecting consumer debts through legal action. They're attorneys who represent creditors and debt buyers in court.
Size and Scope of Operations
Gurstel Law Firm employs over 100 attorneys and support staff. They handle thousands of debt collection cases annually across the Midwest and beyond.
They operate in Minnesota, Wisconsin, North Dakota, South Dakota, Nebraska, and several other states. Each office focuses on local court systems where they file lawsuits.
What Makes Them Different from Regular Collectors
Regular debt collectors call and send letters. They ask for payment. They negotiate.
Gurstel Law Firm takes the next step. They file lawsuits when negotiations fail or when creditors want aggressive collection.
Having attorneys means they can:
- Take you to court immediately
- Obtain judgments against you
- Garnish wages through court orders
- Place liens on property
- Freeze bank accounts
This legal power makes them more dangerous than typical collection agencies.
Their Business Model
Creditors hire Gurstel Law Firm on contingency. The firm gets paid a percentage of what they collect plus legal fees.
This creates a strong incentive to pursue cases aggressively. Every judgment increases their revenue.
According to the Consumer Financial Protection Bureau, law firms collecting debts generated over 16,000 consumer complaints in 2023. Gurstel Law Firm accounts for a portion of these complaints.
Regulatory Status
Gurstel Law Firm must follow both attorney ethics rules and debt collection laws.
They're subject to the Fair Debt Collection Practices Act like other collectors. They're also bound by state bar association rules governing attorney conduct.
This dual regulation should mean higher standards. In practice, attorney debt collectors sometimes operate in gray areas of the law.
Who Does Gurstel Law Firm Collect For?
Gurstel Law Firm represents various types of creditors and debt buyers across multiple industries.
Credit Card Companies and Banks
Major credit card issuers hire Gurstel Law Firm to collect charged-off accounts.
Capital One, Discover, Synchrony Bank, and other major issuers use their services. When you stop paying your credit card, and the account is charged off, the creditor might sell it or hire attorneys to collect.
Gurstel Law Firm files lawsuits seeking the full balance plus interest, attorney fees, and court costs. A $5,000 credit card debt can become $8,000 or more after these additions.
Debt Buyers
Debt buyers purchase old accounts for pennies on the dollar, then hire firms like Gurstel to collect.
Portfolio Recovery Associates, Midland Funding, LVNV Funding, and Cavalry Portfolio Services are common clients. These companies buy massive portfolios of charged-off debts.
They paid maybe 4 to 8 cents per dollar of debt. Hiring Gurstel Law Firm to sue increases their collection rates significantly.
Auto Lenders and Finance Companies
Car loan deficiency balances end up with Gurstel Law Firm frequently.
When your car gets repossessed, the lender auctions it. The sale price rarely covers your loan balance. You owe the difference, called a deficiency balance.
Lenders hire Gurstel Law Firm to collect these deficiency balances through lawsuits. Deficiency judgments allow wage garnishment and bank levies.
Medical Debt Collectors
Hospitals and medical providers sometimes use Gurstel Law Firm for large unpaid balances.
Emergency room bills, surgery costs, and extended hospital stays create significant debts. When patients don't pay, medical facilities either sell the debt or hire collection attorneys.
Medical debt lawsuits through Gurstel Law Firm can result in wage garnishment just like any other consumer debt.
Payday and Title Loan Companies
High-interest lenders use aggressive collection tactics, including legal action through firms like Gurstel.
Payday lenders and title loan companies charge extreme interest rates. When borrowers default, the balances grow quickly. These lenders hire collection law firms to pursue judgments.
Student Loan Servicers
Private student loan companies hire Gurstel Law Firm for defaulted loans.
Federal student loans have different collection processes. Private student loans follow regular debt collection laws. Gurstel Law Firm handles private student loan litigation.
Property Management Companies
Landlords use Gurstel Law Firm to collect unpaid rent and lease-breaking fees.
Breaking a lease early or leaving rent unpaid creates debt. Property management companies hire collection attorneys to pursue these amounts.
How Gurstel Law Firm Got Involved in Your Debt
Understanding the timeline helps you recognize where you are in the collection process.
Stage 1: You Stop Paying
The process starts when you miss payments on a debt.
Credit cards require payment by the due date each month. Miss one payment and you're 30 days late. Miss two, and you're 60 days late. Miss three and you're 90 days late.
Auto loans, personal loans, and medical bills follow similar patterns. Each missed payment pushes you deeper into delinquency.
Stage 2: Internal Collection Efforts
The original creditor tries to collect first.
Their internal collection department calls and sends letters. They offer payment arrangements. They try working with you directly.
This phase typically lasts 90 to 180 days. If you don't pay or make arrangements during this time, the account moves to the next stage.
Stage 3: Charge-Off or Sale
After 180 days of non-payment, most creditors charge off the account.
Charge-off is an accounting term. The creditor writes off the debt as a loss for tax purposes. But you still owe the money.
At this point, creditors have two options. Sell the debt to a debt buyer or hire a collection attorney.
Stage 4: Assignment to Gurstel Law Firm
The creditor or debt buyer decides legal action is necessary.
They assign the account to Gurstel Law Firm. This happens when:
- The debt amount is large enough to justify legal costs
- Previous collection attempts failed
- The debtor has assets or income to garnish
- The statute of limitations hasn't expired
Accounts under $1,000 rarely justify lawsuits. Legal costs exceed potential recovery. Gurstel Law Firm typically handles cases of $2,000 or more.
Stage 5: Pre-Lawsuit Contact
Gurstel Law Firm sends demand letters before filing suit.
These letters identify them as attorneys. They demand payment within a specific timeframe. They warn that failure to pay will result in legal action.
This is your last chance to negotiate before court proceedings begin. Many people ignore these letters, thinking they're just more collection attempts. That's a mistake.
Stage 6: Lawsuit Filing
If you don't respond to demand letters, Gurstel Law Firm files a lawsuit.
They file in your county's court system. You receive a summons and complaint by mail or process server. The documents tell you when to respond and when the court date is.
You typically have 20 to 30 days to file a written answer. Miss this deadline and you automatically lose by default judgment.
Stage 7: Default Judgment or Court Hearing
Most defendants don't respond to debt collection lawsuits.
According to research by the Consumer Financial Protection Bureau, defendants fail to respond in approximately 70% of debt collection cases. This results in automatic default judgments.
If you do respond, the case goes to a hearing. Gurstel Law Firm presents evidence. You present your defense. The judge decides.
Stage 8: Judgment and Collection Actions
When Gurstel Law Firm wins, they get a court judgment for the debt plus interest, attorney fees, and court costs.
This judgment is powerful. It allows them to:
- Garnish up to 25% of your wages
- Freeze and levy your bank accounts
- Place liens on property you own
- Intercept tax refunds in some states
The judgment is valid for 10 to 20 years, depending on your state. They can renew it for even longer.
Can Gurstel Law Firm Actually Garnish Your Wages?
Yes, but only after obtaining a court judgment against you.
How Wage Garnishment Works
Wage garnishment means your employer withholds part of your paycheck to pay your debt.
Gurstel Law Firm files a garnishment order with the court after winning their case. The court sends this order to your employer. Your employer must comply or face penalties.
Federal law limits wage garnishment to 25% of your disposable income. Some states have lower limits. Disposable income means your pay after mandatory deductions like taxes.
What Income Can Be Garnished
Regular wages and salaries are subject to garnishment.
Bonuses, commissions, and overtime can be garnished. Retirement account contributions might be garnished depending on the account type.
What Income Is Protected
Certain income sources are exempt from garnishment.
Social Security benefits cannot be garnished for consumer debts. Disability payments are protected. Veterans' benefits are protected. Child support and alimony received are protected.
These protections only apply if you keep protected income separate from other funds. Mixing Social Security payments with regular income in one account can make the entire account vulnerable.
The Garnishment Process
After winning a judgment, Gurstel Law Firm files for a wage garnishment order.
The court holds a hearing. You receive notice of this hearing. You can attend and claim exemptions if the garnishment would cause hardship.
Most people don't attend these hearings. The court issues the garnishment order by default.
Your employer receives the order and must begin withholding immediately. The garnishment continues until the debt is paid in full or you take action to stop it.
Multiple Garnishments
Federal law limits total wage garnishment to 25% of disposable income.
If you have multiple judgments, creditors must take turns. One garnishes until paid, then the next creditor starts.
Some states allow multiple garnishments simultaneously if the total doesn't exceed the 25% cap.
How Long Garnishment Lasts
Garnishment continues until the judgment is satisfied.
A $10,000 judgment could take years to pay off through garnishment. Interest continues accruing during this time.
The only ways to stop garnishment are paying the judgment in full, negotiating a settlement, filing bankruptcy, or successfully disputing the debt.
Impact on Your Job
Your employer cannot legally fire you for one wage garnishment.
Federal law protects employees from termination due to a single garnishment. However, if you have multiple garnishments, this protection doesn't apply.
Even though it's illegal, some employers find other reasons to terminate employees with garnishments. The hassle of processing garnishment orders makes employers unhappy.
What to Do If Gurstel Law Firm Contacts You
Don't ignore their letters. That's the worst possible response.
Step 1: Verify the Debt
Request debt validation in writing immediately.
Under the Fair Debt Collection Practices Act, you have 30 days from first contact to request validation. Send a letter stating: "I dispute this debt and request validation under the FDCPA."
Mail it certified with return receipt. Keep copies of everything.
Gurstel Law Firm must provide proof of the debt. Original creditor name. Account numbers. Amount owed. Documentation showing they have the right to collect.
Step 2: Check the Statute of Limitations
Every state has time limits for suing over debts.
These range from three to ten years, depending on the state and debt type. Texas is four years for most consumer debts. Minnesota is six years.
If the debt is older than your state's statute of limitations, it's time-barred. Gurstel Law Firm can ask for payment, but cannot legally sue you.
Making a payment on time-barred debt can restart the statute of limitations in some states. Don't pay without legal advice if the debt is old.
Step 3: Respond to Any Lawsuit
If you receive a summons and complaint, respond immediately.
You typically have 20 to 30 days to file a written answer with the court. Your answer should admit or deny each allegation in the complaint.
You can hire an attorney or respond yourself. Many consumer attorneys offer free consultations for debt defense cases.
Responding forces the Gurstel Law Firm to prove its case. They must show documentation that you owe the debt and that they have the right to collect it.
Step 4: Attend All Court Hearings
Never skip a court date related to a debt lawsuit.
Appearing in court gives you a chance to dispute the debt or negotiate a settlement. Not appearing results in an automatic default judgment.
Bring any evidence supporting your defense. Payment receipts showing you paid the debt. Documentation showing the debt belongs to someone else. Proof the statute of limitations has expired.
Step 5: Consider Settlement
If the debt is legitimate and you can't win in court, negotiate a settlement.
Gurstel Law Firm will often settle for 40% to 60% of the balance if you can pay a lump sum. Get settlement terms in writing before paying.
Negotiate to have the lawsuit dismissed as part of the settlement. Request that they not report the judgment to credit bureaus.
Step 6: Know Your Bankruptcy Options
Bankruptcy stops lawsuits and wage garnishments immediately.
Chapter 7 bankruptcy discharges most unsecured debts. Chapter 13 creates a payment plan through the bankruptcy court.
Filing bankruptcy triggers an automatic stay. This legal protection stops all collection activity, including lawsuits and garnishments.
Bankruptcy has serious credit consequences. But if you're facing multiple lawsuits and garnishments, it might be your best option.
Consult a bankruptcy attorney for a free evaluation of your situation.
Your Rights When Dealing with Gurstel Law Firm
Gurstel Law Firm must follow debt collection laws despite being attorneys.
Fair Debt Collection Practices Act Rights
The FDCPA protects you from abusive collection practices.
Gurstel Law Firm cannot harass you. They cannot call before 8 AM or after 9 PM. They cannot contact you at work if you tell them your employer prohibits it.
They cannot lie or mislead you. They must identify themselves as debt collectors. They must provide accurate information about the debt.
They cannot threaten actions they won't take. If they threaten to sue, they must have authorization and intention to file suit.
Right to Dispute the Debt
You have the right to dispute any debt they claim you owe.
Your dispute must be in writing within 30 days of first contact. They must stop collection until they provide validation.
Many debts Gurstel Law Firm pursues lack proper documentation. Original creditors often can't provide signed agreements or detailed account histories.
Right to Legal Representation
You can hire an attorney at any point in the process.
Many consumer protection attorneys work on contingency for FDCPA violations. If Gurstel Law Firm violates your rights, you might not pay attorney fees out of pocket.
Having an attorney levels the playing field. Gurstel Law Firm takes represented defendants more seriously.
Right to Claim Exemptions
Certain assets and income are exempt from collection.
Exemption laws vary by state. Common exemptions include homestead protection, vehicle equity up to certain amounts, and necessary household goods.
If Gurstel Law Firm tries garnishing protected income or seizing exempt assets, you can file exemption claims with the court.
Right to File Complaints
You can report FDCPA violations to regulatory agencies.
File complaints with the Consumer Financial Protection Bureau at consumerfinance.gov/complaint. File with your state attorney general's consumer protection division.
Document every interaction with Gurstel Law Firm. Dates, times, names, and content of conversations. This evidence supports complaints and potential lawsuits.
How Gurstel Law Firm Impacts Your Credit
Lawsuits and judgments severely damage your credit score.
Before the Lawsuit
If the original debt was already in collections, you already have credit damage.
Collection accounts drop credit scores by 80 to 150 points. The assignment to Gurstel Law Firm for legal action doesn't create additional credit reporting initially.
After Judgment
Court judgments appear in the public records section of your credit report.
A judgment can drop your credit score another 50 to 100 points beyond the collection account damage. The judgment stays on your report for seven years from the filing date.
Even if you pay the judgment, it still reports for seven years. It updates to "satisfied" but remains visible to lenders.
Impact on Future Credit
Judgments make it extremely difficult to qualify for new credit.
Most lenders automatically deny applicants with unpaid judgments. Even paid judgments raise red flags.
Mortgage lenders typically require all judgments to be paid before closing. Some require judgments to be paid and seasoned for 12 to 24 months.
Removing Judgments from Credit Reports
Judgments can only be removed through:
Waiting seven years for automatic removal Successfully disputing the judgment as inaccurate Negotiating a "vacate judgment" as part of settlement Filing bankruptcy
Some defendants negotiate with Gurstel Law Firm to vacate the judgment after payment. This removes the judgment from court records and credit reports.
Get this agreement in writing before paying. Not all cases qualify for vacated judgments.
Final Thoughts From a Texas Credit Repair Expert
Gurstel Law Firm isn't just another collection agency sending threatening letters.
They're attorneys with the power to sue you, obtain judgments, and garnish your wages.
Running a credit repair company in Texas, I've helped dozens of clients dealing with Gurstel Law Firm lawsuits. The clients who act quickly get better outcomes. The ones who ignore the problem face wage garnishment and bank levies.
If Gurstel Law Firm contacts you, take it seriously immediately. Verify the debt. Check the statute of limitations. Respond to any lawsuit paperwork.
Don't assume you can't fight back. Many debt collection lawsuits are won by defendants who simply show up and demand proof of the debt.
Gurstel Law Firm counts on you not responding. They win most cases by default. Don't make it easy for them.
Your wages, your bank accounts, and your credit are at stake. Protect them by knowing your rights and taking action.
If you're overwhelmed or unsure what to do, consult a consumer protection attorney or credit repair professional. Many offer free consultations to evaluate your situation.
The worst thing you can do is nothing. Ignoring Gurstel Law Firm won't make them go away. It just makes their job easier.