What to do if I enrolled in a debt settlement programbut am now being threatened with a lawsuit from one of my creditors?

The lawyers from the company don’t have time for me; basically I get no response at all. I wonder if it is possible to get away from this company and go with another? My husband was in a similar situation with his debt, enrolled with another company, and was debt free in 3 years. Never had these kinds of problems. I am beside myself. Is there anything I can do to get out this contract with them? Other than bankruptcy, do I have other options? I have been with them for almost 10 months.

Asked on October 28, 2011 under Bankruptcy Law, Pennsylvania

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

1) As to whether you can get out of your contract with this company, it depends on whether  they have breached the contract. Not communicating with you may well suffice, since they are not fulfiling their obligation(s) to you. Also, if they lied or misrepresented to you to get you to sign up with their service, that misrepresentation should let you out of the contract, too.

2) In tems of lies or misrepresentations: if they told you that, for example, you could safely pay your money to the debt settlement company, that is a misrepresentation. There is no right to pay your debt to a debt settlement company and not to the creditors. As soon as the creditors are not paid on time, you are in default and they can sue. Not telling you that, or claiming that would not happen, could be the sort of misrepresentation that would let you out of the contract.

Given that  you need to deal with terminating a contract with a debt settlement company and also with a potential lawsuit, you should retain an attorney to help you.


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