Credit card lawsuits on the rise

Many people in the United States have lived beyond their means for years, and now with the nation’s recession and high unemployment rates, credit card lawsuits are at an all- time high.  If you find yourself being served a summons for repayment of credit card debt, don’t ignore it, there are solutions to help you.

When will credit card companies start legal action?

Credit lawsuits costs can be recouped

Typically, if you have fell behind on credit card payments, most companies will go approximately six months until they send a letter stating that a judgement  will be filed against you for non-payment.

Many times credit card companies will use this as the last resource, due to the expense of a lawsuit, and many times the credit card company will not have proper documentation for the courts, and they don’t end up recouping their money.  However, this is not always the case, so if you are being threatened by a company, it is best to act on it immediately.

 

What steps do you take if you get a lawsuit against you?

Many times a credit card company will sell your account to a debt collection company, however, in the event that the credit card company sues you, there are steps you should take before action takes place:

• Be sure to contact the courts so they know you  have intentions of settling this matter.  Many times this will buy you more time to try and settle with the company outside of court.

• Read all documentation carefully.  Credit card companies will often times have the incorrect amounts you owe, and they don’t always keep good records.

• Many times the balances will be much higher than what you owe.  Credit card companies will try and get more money by adding more interest and other charges to the account.

• Try to settle with the credit card company by asking that they take off interest and other late charges.  If they will settle with you, out of court, be sure to get everything in writing so they cannot come back later on you for unpaid debt.

• If a settlement is out of the question, you may want to seek legal advice about your rights as a consumer.

If you have fallen behind in credit card payment, don’t wait until the situation escalates into legal action.  If the consumer does not act promptly to the matter, garnishment of wages can be rendered, and the only course of action you can take at this point is to ask the judge to lower the amount of garnishments.  Many times it is difficult to get the judge to lower garnishments.

If the lawsuit has got to the point of garnishing wages, certain items are protected from garnishments, such as social security, federal and state tax and unemployment insurance, however, health insurance, union dues, and retirement contributions are not protected and the amount of garnishments can be taken from this, sometimes leaving the employee with nothing much to live on.

If you are faced with financial burden, be sure to stay on top of it and not ignore it.  There are many options out there to keep you out of a credit card lawsuit, beit a professional like James Foley or your own personal research.

About the author: Thanks to the writing that has complemented Cindie's work as a medical coder in Missouri, consumers can be informed on a variety of dynamics, from attournies in Fort Worth to food.

* Image attribution: Maggiebug21; CC BY-SA 3.0