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Default Judgments Arise As Consumers Are Forced to Use Up Credit During Pandemic

  • Nov 24 2020

To say that life isn’t fair may seem to be an empty, overused statement these days—although for many it is clearly evidenced through repercussions caused by the COVID-19 pandemic, whether in terms of health, finances, or both. Previous to the viral outbreak, you may have already been experiencing money problems. For most people in the US, major financial distress is usually due to a personal crisis like sickness or an injury with a long-term recuperation period. Other unfortunate personal crises may have factored in too, like unemployment, divorce, or additional financial burdens like cumbersome student loan debt.

The COVID-19 pandemic brought on a long list of frightening repercussions, including the potential for illness and loss of loved ones, unemployment, restrictions, closed businesses—all piled on top of a previously stressful situation for many, punctuated by historical levels of consumer and household debt. If you had credit cards with available balances at the ready upon losing your usual income—or business—it may have been difficult to avoid using them when no other funds were available.

Recent data shows that the average American has four credit cards, with balances hovering at $6,200. Increases have also been seen in the amounts that cardholders are allowed to max out, with limits in the last decade growing by 20%. Consumers now also show a growing (and concerning) tendency to charge basics like groceries on their credit cards.

As debt collectors are coming back full force, courts are expected to be inundated with collection lawsuits. You may be wondering what you can do in the face of health issues, unemployment, and more; ironically though, while your situation may seem worse than ever, creditors are more inclined now to negotiate—mainly because they are worried about bringing in any sort of revenue while millions are struggling and without jobs.

Consult with a skilled attorney from Fitzgerald & Campbell, APLC to examine your options. This is especially critical if you have recently been served with a summons and complaint, whether by a deputy or private process server. While it may be extremely tempting to push the documents under the rug and forget them, such action is not in your best interest at all! A collections lawsuit that goes ignored usually (and almost automatically) turns into a default judgment. Even worse, this can mean loss of wages of up to 25% of your disposable income, freezing and loss of control of bank accounts, and even seizure of personal belongings.

Contact Fitzgerald & Campbell, APLC now. Let us review your case and discuss what would work best for you. We are here to help! Our attorneys have decades of experience in serving clients as they navigate through challenging financial situations, to include collection lawsuits, default judgments, and more. Click here to schedule a free 30-minute consultation, or call us at (855) 709-5788, or email us at info@debtorprotectors.com.


Posted in: Judgments