Legal Action by Creditors

It usually takes about six months before you don`t pay a debt before you can be sued. In general, creditors and employees of credit card companies prefer to develop a viable payment plan with their debtors rather than take legal action. If you owe money, dealing with creditors and collection agencies can be a cumbersome and very stressful affair. You want to stop the constant barrage of collection calls and letters reminding you that you have outstanding debts – as if you weren`t already aware of it – calls that can negatively affect you mentally and physically. And it gets worse when creditors threaten to take legal action against you to get the money back. You can sue a debt collector who violated the FDCPA. You must take legal action within one year of the collection agent violating the law. You may need the legal services of a lawyer to help you bring this lawsuit. By responding to the lawsuit, either yourself or through a lawyer, you can ensure that the debt collector has to prove that you owe the debt, that the amount of the debt is correct, and that the debt collector has the right to sue you to collect it. You may even be able to resolve the debt by responding or appearing in court, as some debt collectors prefer to settle rather than have a lengthy legal battle. While this can be used as a scare tactic if one of your creditors has actually received a wage garnishment, they have the right to have your wages garnished.

If this is the case, you should try pursuing the following options to stop a wage garnishment: Debt collectors can`t lie to you to get you paid immediately. For example, they can`t threaten to sue you if they don`t intend to sue you. Debt collectors must hire a lawyer to take legal action, and legal services are expensive. The threat of legal action may therefore be empty. They may not intend to sue you. Lying about a legal action against you is considered a fraudulent practice and is prohibited by the FDCPA. If you simply ignore the complaint by not responding with a formal response, your failure to act may result in a default judgment against you. This means that they will find you guilty and the judge will decide your sentence.

Some lawyers may also offer free services or charge discounted fees, such as through your local bar association. You may want to find a lawyer who has experience with the Fair Debt Collection Practices Act and debt collection issues. There may also be legal aid offices or clinics in your area that offer their services free of charge if you meet their criteria. Service members should contact their local JAG office. Your response to the lawsuit will likely be determined by your financial situation. You can negotiate an arrangement with the creditor at any time. Legal services are expensive. Thus, the creditor can settle the lawsuit to reduce the cost of attorney`s fees.

If you can, get legal advice on how to prepare a response. The Law Society in your area can offer free legal assistance. The law of debtor-creditors governs situations in which one party is unable to pay a pecuniary debt to another. There are three types of creditors. First, those who have a lien on a particular piece of land. This asset (or the proceeds of its sale) must be used to repay the debt owed to the secured creditor before it can be used to repay debts owed to other creditors. A privilege may arise by law, agreement between the parties or legal proceedings. See, for example, secured transactions and mortgages. Second, a creditor may have an overriding interest. A priority stems from the law. If a creditor has priority, its debt must be paid if the debtor becomes insolvent before other debts.

For example, Congress has prioritized debt over the federal government. See Federal Tax Lien Act. The last type of creditor is one that has no lien over the debtor`s assets and is not subject to any legal precedence. Has a debt collection agency threatened you with legal documents? You hope it scares you so you can pay as soon as possible, but is this threat real? What can you do if you can`t pay the debt? Federal law limits the actions a debt collector can take.