What legal rights does a credit card company have in a default case?
Question Details:
I had a credit card with a balance of $5,000. Ihad to take a 20% paycut at work so I called my credit card issuer and asked if they would freeze my account and that I was willing to pay them back the amount that I owed but that I couldn't send the minimum amount but I could send $20 per month. Also, as I worked any extra that I would send that in addition. They said no; I would have to make the payment as originally agreed. My debt has been passed off to a law firm that is now saying that I owe nearly $7000. If this goes to trial what can they do to me? Garnish my wages? If so, how much? I was told that they they could take my home and put me and my kids out on the streets. I'm really getting scared; at this point any info would be helpful.
Hi. I am a Missouri attorney that handles a lot of debtor representation work, throughout most parts of the state.
I am not certain from your original posting as to whether or not the creditor has already filed a collection lawsuit against you. You did indicate that the debt was being collected by a law firm. A referral to a law firm typically occurs as a last resort, before the company will have the law firm file a case against you.
If, on the other hand, a case has been filed, and you have received a court date, the first piece of advice is to be sure that you appear on time on the court date, or else have an attorney whom is assisting appear for you. If you or an attorney does not appear, the creditor will take an automatic "default judgment" against you. This means that you will have a court order then to pay the entire amount alleged to be owed, and a relatively short time to make the payment. If the creditor gets a default judgment, they can then garnish wages, freeze your accounts, or levy your property, meaning that a sale of your property could be ordered.
If you have an attorney appear on the court date, he or she will typically work with the attorneys for the creditor to negotiate some type of payment arrangement that will, ideally, allow you to re-pay the debt in small monthly payments. I have had success in the past in getting the amount of the overall debt reduced as well.
There are numerous tactics that attorneys use in negotiating for the best re-payment plan possible, and, often, an attorney can extend the court dates so that you can have additional time to come up with any payment you may be required to make.
You do always have the option for setting the case for trial. However, complex rules of civil procedure and evidence typically apply, and, in order to prevail, you would have to establish a solid legal ground as to why you do not owe the debt. The creditor will likely bring witnesses as well. Typically the best way to go with these cases is to work out a re-payment plan that will result in a dismissal of the case, when the payments are made.
I hope this helps at least to some degree. My e-mail is mth2000@yahoo.com. Thank you.
NOTE: This answer is for educational purposes and does not constitute legal advice. The use of this site does not create an attorney-client relationship or privilege between the user and the attorney responding.
Ok you need to speak with someone to help you with this matter. You may want to start with legal help as the matter is already with an attorney. You should start by contacting the State Bar of Montana: http://www.montanabar.org or Montana Legal Services Association: http://www.montanalawhelp.org/Program/575/index.cfm. They will be able to provide free or low cost legal help.
Next contact the Montana Attorney Generals Office for credit counseling. They may be able to help reduce the debt and help with a repayment plan. It is also te first required step to filing for bankruptcy should that option be discussed. http://www.doj.mt.gov/consumer/consumer/creditcounselingservices.asp
Many of us are in the same boat. Although this is not a consolation at this point what is good is that there is a lot of help out there because of it. Good luck.
