What to do if you get sued for credit card debt?

You have to either hire a lawyer or go to court to file papers within the period of time provided for under the law (a phone call to the credit card company’s lawyers won’t protect you). If the court schedules a hearing, you or your lawyer have to appear in the right place and at the right time.

Why are there so many credit card lawsuits?

Many people think debt buyers prefer to avoid lawsuits to collect old credit card debts because it requires them to pay lawyers and incur costs of litigation. If this were true, however, credit card lawsuits would be far less common than is the case. In fact, there were nearly 200,000 credit card collection lawsuits filed in New York in 2011 alone.

When do you get court papers about a credit card lawsuit?

When you get court papers about a credit card lawsuit, you have a choice: take no action, or use the laws to level the playing field. The debt collectors have done everything possible to convince you they have all the power, but that’s not true.

What happens if you ignore a credit card debt summons?

If you ignore your summons, the court is likely to rule in the debt collector’s favor and your wages could be garnished until you pay back the amount of money that the court rules you owe. If you are sued for credit card debt, your first step is to verify that the debt is actually yours.

What to do when your credit card company sues you?

When you’re sued over your credit card debt, the most important thing is to take it seriously. Credit card companies typically do not want to pay the cost of a trial, so consider settling for a lesser amount outside of court. (Getty Images) Ignoring debt collection calls usually doesn’t make them go away.

What happens if you fail to settle a credit card debt?

If you fail to settle the debt with the debt collector, it might be sold and resold again. Eventually, a collector will probably refer the debt to an attorney’s office to initiate a lawsuit. Once your debt reaches the debt collection law firm, the attorney will usually give you one last chance to settle the debt to avoid a lawsuit.

What are the odds you will be sued by a debt collector?

If it is unsecured, he might offer you a reduced settlement or new payment arrangement to get you paying again. Big creditors don’t sue over small debts. The collection letter claims that you will be sued for the $284.37 you owe the XYZ Credit Card Company, but the odds that they will sue are extremely small.

Can a person go to jail for credit card debt?

Suing someone over an old debt is the last step in the debt delinquency timeline, not the first one. Here’s the good news- you can’t go to jail for credit card debt, and if a debt collector implies…

If you do receive a lawsuit for your outstanding debts you could hire an attorney for legal help or have your debt settlement company handle your lawsuit if they offer that option to you. Although no one wants to take on a big bank in court, you do have certain rights to your assets too.

Can a creditor file a lawsuit if you default?

Let’s face it — when it comes to debt, there can be consequences involved when you can’t afford to make your monthly payment. As a matter of fact, your creditor can actually file a credit card lawsuit anytime you default on your debt.

What happens when you get sued for credit card debt?

By the time an unpaid debt turns into a court summons, it has already passed from the initial creditor to at least one debt collection agency. Sometimes your debt has been handled by multiple debt collection agencies, each one selling or passing your debt along until one of the agencies decides to take you to court.

What happens if you default on a credit card?

Debt has its consequences, some of which will surprise the average American consumer. For example, when you default on credit card debt, the major consequence could be a lawsuit. Hold on.

Is there a way to settle my credit card debt?

Debt settlement is a great option to help you resolve your debts if you follow the program and choose the best company. If you are worried about getting sued by your creditors, enrolling with a debt settlement company that offers legal help would be a good option so make sure you do your research.

Can a credit card company forgive a lawsuit?

During your call with your creditors, there’s no harm in offering to pay off some of your debt. If you do speak with your creditors, you should ask the credit card company if they’ll forgive the remainder and forget about the lawsuit. It doesn’t hurt to ask to be “held blameless” as well.

Can you negotiate and settle a credit card lawsuit?

—Darby Yes you can negotiate and settle a credit card lawsuit. In some cases, if you cannot raise enough money to settle in a lump sum, you will be able to set up affordable payment arrangements to keep from being garnished, or your bank account levied.

Can a victim of identity theft sue a credit card company?

If you were a victim of identity theft and never applied for a credit card at all, this also can be raised as an affirmative defense. Many states such as New York require debt collection agencies to be licensed and registered in the state and include a license number in the complaint.

When do you get sued for a credit card debt?

Being sued for a credit card debt happens at different stages of collection. Are you being sued by a collection law firm on behalf of your original creditor? Lawsuits in the first stage of credit card collections (your account has never been sent to a debt collector) is not that common, but it does occur.

When to respond to a debt collection lawsuit?

Worse, the collector may be able to add attorney’s fees, court costs or interest to the balance. In some cases, the balance can double or triple due to these additional costs. Responding to a debt collection lawsuit, then, is a must. Once the plaintiff (the collection agency or creditor) files a lawsuit, the matter is put before the court.

Can a credit card company get a judgment against you?

If you are in default on a credit card account, the credit card company can try to get a credit card debt judgment against you by filing a lawsuit. If the credit card company gets a judgment, it can use all sorts of collection methods against you to get paid.

What’s the best way to settle credit card debt?

Out-of-court settlement is usually the best option. If you settle the debt out of court, the creditors and their lawyers can withdraw the case. You can avoid the hassle of filing an answer formally with the court.

Can a credit card company sue a delinquent person?

If you’re delinquent on your credit card payments, the credit card company or a debt collector hired by the credit card company might sue you to recover the money you owe. When you originally obtained the credit card, you signed an agreement either electronically or in writing.

What to do if you get sued by a credit card company?

If you are sued by a credit card company, then you should begin planning your defense right away. You certainly have a good shot of beating the lawsuit. As many as 90% of all plaintiffs in a credit card lawsuit have trouble proving that the defendants actually owe them money.

Can a judge dismiss a credit card lawsuit?

However, if the plaintiff waited too long, you can have the judge dismiss the lawsuit. The plaintiff hasn’t stated a valid claim. Typically, the plaintiff must attach to the complaint enough documents that show a valid contract. For example, a debt collection agency must show that it bought the right to sue on a valid debt.