What You Need to Do If Sued For a Bad Debt
What You Need to Do If Sued For a Bad Debt
Credit card companies write off bad debt due to several reasons like time, cost and most importantly due to lack of resources. However as per the working procedure credit card companies even bundle up some of the accounts and send them forward to attorneys all over the country who further file law suit as a process of recovering debt. If your account is one of those accounts then how will you handle the situation? This article will highlight a few points which can help you under such circumstances.
Filing an answer: In case you have received summon because of a complaint filed by an attorney of a credit card company then you will need to take steps. Summon will have a time line which will tell you how much time you have to file an answer. In such a case it is in best interest to hire a lawyer, however if your financial condition does not permit you so then you can file an answer yourself. You can also go ahead and file a counter claim on your own. For this you will need to contact the local clerk of court office and get a standard answer form. Then you will have to go through the complaint and respond to each complaint that has been made against you. In case you are denying any part of the claim such as the balance owed then you will have to demand proof. Each answer should be numbered. Then you can file your answers with the clerk's office and send a copy of the same to the credit card company's attorney. In case you have questions regarding the process you can ask for legal advice.
File a counter claim: A consumer can even file and serve a counter claim on the credit card company's attorney. This counter claim is basically a document stating that you are suing the credit card company. In case the credit card company has broken any fair credit reporting act or there is a false claim against the consumer then you can file a counter claim. While filing a counter claim it is bets to hire an attorney. They will be better equipped to argue in the court on your behalf.
Negotiate a payment plan: In case the account stated in summon is yours and you do have a debt with the credit card company then you must try and negotiate a payment plan with the attorney's office. Most credit card companies prefer to get their payment than to follow the judicial procedure. In case the attorney agrees for a payment plan and you are unable to keep up with your side of the bargain then the legal proceedings will resume.
A normal legal proceeding could result in the judge determining that the debt is indeed yours. In this case your credit score will take a major hit. You could also have your assets seized and sold. Depending on the state law a debtor's wages can also be garnished to pay off the debt or the judge might just dismiss the case if the credit card company could not provide sufficient evidence.
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