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Creditor Lawsuits: What to Do When You Have No Income

Creditor lawsuits
  • May 31 2018

Trying to pay all the bills is stressful for most of us on a good day. As the cost of living rises in most areas and many pay raises can’t compete—or simply don’t happen at all—individuals and families are challenged just to keep up with the basic monthly payments such as the home, car, and utilities. Consumers today owe an average of $178,037 to lenders for their mortgages, along with $27,755 to auto loans, and $15,983 to credit card debt. When something goes wrong, it can be difficult enough to keep up with the basics, not to mention unsecured debt—or burdensome student loans which may leave borrowers in the younger ranges (20- to 30-years-old) with monthly average payments over $350.

Credit card debt is one of the most common reasons consumers today are served with collections lawsuits—and many of the larger corporations are proficient at churning out thousands of summons and complaints each year. If you have been on the receiving end of a collections lawsuit, you may be at a loss for what to do, especially if you are aware you owe a debt but have no income to pay it. In consulting with a skilled collections lawsuit attorney, you can explore your options, and gain a better understanding of why it may be critical to file a response to the lawsuit.

If you truly have no income and do not foresee having any in the future, the lawsuit may just signify one more wound to your credit. Your attorney may still recommend attempting to defend the lawsuit, however, if they suspect the debt collection agency suing you may not have the proper standing or cannot provide all the necessary paperwork for the account. In some cases, lawsuits are launched with a surprising amount of errors—or unfortunately, in all too many cases, the debt may have been a result of fraudulent activity or stolen activity. In the end, it is almost always worth it to make the effort to avoid having a default judgment granted against you.

If you do have a job, income, financial accounts, or property, a creditor could make your life significantly unpleasant if a default or court judgment is granted against you. If you fail to respond to the lawsuit, chances are good that the judge will grant a judgment almost automatically, giving the creditor the right to begin garnishing your wages, freezing your bank accounts, and taking your property to be auctioned off for satisfying the debt. While it is not recommended that you let the process go this far, your attorney may be able to file a motion to vacate and then fight the original case, or they may suggest you file for Chapter 7 bankruptcy to see almost all unsecured debt discharged within three to six months.

If you are concerned about impending creditor lawsuits or fighting a default judgment, consult with an experienced law firm like Fitzgerald & Campbell, APLC as soon as possible. A solution can be found to help you through any of these issues, even if a judgment has already been granted. Let us review your case and discuss what would work best for you. We are here to help! Call us today for a free consultation at (855) 709-5788 or email us at info@debtorprotectors.com.

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Posted in: Collections lawsuit, Credit Card Lawsuits