Being in debt can cause considerable (and often extreme) amounts of stress. With the average household today in over $131,000 of debt, financial duress is all too common, resulting in ongoing delinquencies, difficulty in making the house and car payments, and some consumers may even be defaulting on mortgages and student loans. Credit cards are one of the biggest issues for many consumers in the US though.
Your debt—and credit cards especially—may have escalated to the point of no return due to one or more serious life events that were out of your control such as an illness, a major accident, or unemployment. As the bills continue to pour in, you may find yourself searching for solutions continually—and thinking about money around the clock. Or, like so many others struggling to pay an insurmountable amount of bills, you may be struck with such a sense of hopelessness that you not only begin ignoring the phone calls from debt collectors but attempt to forget about the problem altogether. Although your credit will probably end up diminished (perhaps substantially so) behind the scenes, this ‘head in the sand’ approach may work indefinitely. One day though, a process server may show up at the door bearing a summons and lawsuit with your name on it.
There is a definite shift once the credit card company files a lawsuit. Responding (usually required within 20 to 30 days) is recommended, and your collections lawsuit attorney may be able to fight the lawsuit quite easily simply by asking the creditor to verify the debt and prove that they have the right to sue you over the account. In the best scenario, the case could end up dismissed—but if not, you may find that the creditor is amenable to negotiating a payoff at a handsome discount.
As you work beyond the experience of being sued and resolve the issue, here are some tips for going forward:
- Educate yourself about what is on your credit report, and begin figuring out how to satisfy other outstanding debts or judgments. Consult with your attorney regarding your options, to include negotiating debt settlements.
- Examine your finances to understand exactly how much is coming in—and what needs to go out. In setting up a budget, make sure that it is realistic, allowing you to stick with it for the long-term.
- Try to pare down your debt, along with getting rid of too many credit cards. Pay off debt with higher interest, as well as looking into any possible programs for transferring balances to lower-interest accounts.
- Discuss filing for Chapter 7 bankruptcy as a last resort if there is still overwhelming debt without enough income to pay creditors. While you may worry about the social stigma associated with bankruptcy, it can be an extremely effective mode of financial planning to set you free from debt and allow you to start fresh.
If no action was taken regarding the collections lawsuit, you may find yourself forced to deal with a judgment. Consult with an experienced judgment attorney as soon as possible to have it reversed or negotiated down so you are not forced to deal with wage garnishing or levying of bank accounts or property.
Speak with an attorney from Fitzgerald & Campbell, APLC as soon as possible to examine your options. Our attorneys have decades of experience in serving clients as they navigate through challenging financial situations, to include student loan issues, bankruptcy, and other debt management processes. We are here to help! Click here to schedule a free 30-minute consultation, call us at (844) 431-3851, or email us at info@debtorprotectors.com