What to do if I was just served today on an old credit card?

UPDATED: Aug 27, 2011

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What to do if I was just served today on an old credit card?

I was served today on an old old credit card for about $8,000. I was out of work and didn’t have the means to pay living expenses and all my bills. My wife and I have just started to get back on track with our bills and credit and don’t want to file bankruptcy. What do I need to do so as to not lose the judgement for not answering? Will the creditor still be willing to negotiate a settlement out of court for less even after filing? I might be able to get a small $3-4K loan on my car to pay a lesser amount. I’d rather pay a small loan payment than a larger monthly judgement amount.

Asked on August 27, 2011 California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

First issue: how old is the default (that is, how long ago did you stop paying)? It appears that in California, the statute of limitations, or time to sue, on a defaulted credit card debt is 4 years, so if you stopped paying longer ago than that, it may be that you can't be sued.

Assuming that the case is not too old and you can be sued--

Second: if you don't answer you will lose by default. No matter what, file an Answer in the case. Deny any allegations you can in good faith deny; answer other ones that you don't have the knowledge to answer. By answering, you avoid an automatic loss and give yourself time to try to settle.

Third, you can and should try to settle. Any settlement is voluntary on the creditor's part, so try to come up with the best offer you can make. Initially offer something less than that--they'll never believe your first offer is your best--but be prepared, if you want to settle to go to the best one you could possibly honor.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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