If you are experiencing financial difficulties and cannot pay your bills, then you will likely end up getting sued by at least one of your creditors if you stop making payments. Often a collection lawsuit can be the straw that broke the camel’s back, and you may decide to file bankruptcy instead of defending the lawsuit. Once you file bankruptcy then all collection efforts must cease, including any lawsuits or wage garnishments. However, if there’s only one account that’s causing you problems then defending the collection lawsuit may be a reasonable option.
Generally the only defense to a collection lawsuit is that the debt is not actually yours and they have sued the wrong person or that you paid the debt and they made a clerical error. These are rare scenarios that you shouldn’t expect to happen to you, so that leaves just two other options. First we will determine if the creditor can actually prove his case in court by requesting proof of the debt, which should include a signed contract plus an itemization of charges and payments they relied upon to reach the ending balance. It could be that they cannot produce the documents and have to dismiss their case or that they cannot produce a contract that includes a right to collect attorney’s fees which may allow us to negotiate a smaller settlement. The last step to resolving a collection case is usually negotiating a settlement for a reduced lump sum or a monthly installment payment. Your attorney may also help you set up a payment plan that allows you to avoid a wage garnishment, but if you miss your payments the creditor may go back to court to get a garnishment.
In some cases it may also be possible to sue the creditor or even the creditor’s lawyer for violating state or federal laws regarding debt collection. Usually this involves a violation of the federal Fair Debt Collection Practices Act (FDCPA), which regulates what actions creditors can take to collect a debt and what remedies are available to consumers harassed by unethical debt collectors. Common legal violations of debt collectors are making threats like they can have you arrested and sent to jail for not paying (that can’t happen legally in the U.S.), calling outside of normal daytime business hours, calling a third party such as your employer to ask them to get you to pay, or continuing to harass you after you have disputed the debt’s validity in writing. Sometimes your lawyer may be able to negotiate a mutual release of liability between you and the creditor if they violated the law, which means your debt is wiped out and you agree not to sue them under the FDCPA.
- Put an end to credit card company harassment
- Get legal defense from collection agencies
- Become familiar with your rights in disputes with creditors
- Find options for confronting tax burdens that are insurmountable
- Protect your assets and property from repossession or foreclosure
- Avoid eviction
We have been serving the people of Memphis since we established our law firm. We have been dedicated to keeping our legal fees low while we also provide extraordinary legal representation. We know you have financial concerns and we will do all we can to keep your fees affordable. But we will also provide you the legal help you need no matter the stakes in your case and the complexity of your financial situation.