Legal Matter

Were you served with papers and notice of a court date or is the notice simply a letter from the company threatening suit? My advice greatly depends on which it is.

So I assume from your post you owe $2300 total to them (approx). Any way you can come up with a small portion of that and try to settle?

PLEASE NOTE** If you do somehow come up with the funds to settle, and trust me they will take a lot less than you think they will, especially knowing you are unemployed they will take what they can get, BE SURE TO GET ANY SETTLEMENT AMOUNT IN WRITING. Never just send money unless you get a letter in writing saying your payment is a full release. This really is your best option, so try to gather some funds.

I commend you for doing the right thing and paying your debts. You will get through this. And stop beating yourself up. Think of the amazing future you will have after going through this learning lesson.

right now, this very second - go to dave ramsey's website (his name, no spaces, dot com).

Listen to his live show (on now).

There will be a caller with your situation and he will walk them through their rights and strategies.
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btw - a letter saying they are suing you is not the same as being sued. Did you get served court papers, or just a strongly worded letter threatening suit?

They would lose money suing you. They will say ANYTHING to frighten you into borrowing from someone else to pay them, however.

I believe that if you pay them anything at this point, that you will make it impossible for them to write-off your debt.

You need to actually understand your rights here. You do have some. And yes, for those who want to argue that you owe the debit, you do, but I'm going to ignore that part at this point.

Read what you can about consumer rights in regards to unpaid credit card debt and about collection calls in general. I think that you need to know whether you have to keep answering these phone calls or if you can stop taking them. You also need to know if you are talking to the credit card company itself, or an actual collections agency.

I do want you to know that you will probably be dinged by the IRS if the company has to write your debt off. The IRS may consider the $2300 to be income and you'd be responsible for paying taxes on it. Of course, if you aren't making any money, you might not have enough income to qualify for paying taxes on it anyway...

There's another thread on here that talks about a collection agency harrasing the family of a man who intentionally shirked his fiscal responsibilities (not your circumstances). They were calling a very long time after the debt was written off by the company. Collection agencies do this - make sure you understand this. And it won't help your credit to pay something like this off years later. All you do is make the collections people happy.

Don't pay one of those consolidation agnecies to deal with this. You'll get fleeced. However, you DO need to go to the library and check out a book by Dave Ramsey about how to live without any debt. DO THIS. It will change your life. Many women on here have done it and swear by his advise for people who overspend and have trouble managing their finances.

Knowledge is power, N.. You'll feel better once you understand what the credit card company/collections agency can legally do or not do, and what you can legally NOT pay. You also need to know HOW to not pay. That's important too.

Good luck.

N.:

You need to go to court. When you get the summons from the Sheriff. GO. TO. COURT. DO NOT MISS THE COURT DATE.

Your case will be called. You will tell the judge that you owe the money, want to pay the money but due to unemployment - you cannot.

The judge will ask for proof of unemployment and what you have been doing to keep a roof over your head, gas, etc. Then he/she will set a judgement against you. This judgement will allow the debt collector or credit card company to garnish your wages or your tax returns until the debt is paid in full.

If are you not working, I do not understand how you cannot qualify for free legal aide. However, in this matter - you really don't need it. You could fight and say it's not your debt (but that would be lying, right?) or you can make them prove the debt - but really - that's just avoiding the inevitable. You know it's your debt. You owe it.

Go to court. Tell the judge you are TRYING but they are not cooperating with you and your situation.

Good luck!

Total scare tactic! There is truly so little that they can do (possibly garnish your wages) but usually do nothing more than obtain a judgement that they really cannot collect. If you do get a judgement against you, change your bank account after the judgment date is entered by the court. My sympathy for the banking industry is zero!

They are bluffing. Trying to scare you. And it's working. They can't get money from someone who is unemployed. They're trying to force you to hit up your relatives or sell something to pay them - the louder and nastier they are, the more likely they will get paid before your other creditors.

Either send them $10 a month on a regular basis, or see if they will negotiate a settlement for a lesser amount than the $2300. Get caller ID and/or stop answering the phone.

Is this your only debt? If not, talk to one of the consolidation services (check with your state's consumer protection division to see if there are some that are not legitimate - I think CCCS is a legit one but there are others). They will negotiate with the credit card companies and take you out of the mix, and the creditors can no longer call you directly. Make the payments small and affordable, and then don't miss them.

Try not to panic - they can annoy the hell out of you but they can't do much. Even if they DID take you to court (which they don't want to do due to the fees involved), they will capitulate at the last minute and take $10 a month. The judge will sign off on it and the calls will stop. But it may not get that far.

i went thru this and ended up having to file for bankruptcy :-( .... my attorney told me , in the state of FL (where I am) if you are a single parent they cannot garnish your wages (good for me) and also in the state of FL they cannot take your house. those 2 things are protected. check the laws in your state, i would get a consultation with a lawyer, if you can truly not afford to make a payment plan with them. and trust me, none of them are sympathetic. i offered a payment plan to my cc company and they would not accept it. they wanted all or nothing.

All that will happen is they will get a judgment against you which will allow them to garnish your wages when you do start working.

They are bluffing, as others have said, but they can file a lawsuit in small claims court.

If that happens, DON'T ignore it..... they are hoping that you won't show up.... if you don't show up, they will get a default judgement against you.

If you do show up, and they do also, you might get lucky..... many of them get dismissed without prejudice, because they really don't have all the proof that they need to have to have a successful outcome.

Be careful if you use a consolidation company. A lot of them will advise you to ignore your debts, so that they can get you a better (i.e. lower) payment rate. It will make your credit worse. A friend of mine did this, thinking this company would help them get out of debt, and save their credit. It ended up working against them for a good while. Find a company this is willing to work with you and preserve your credit instead.
I also agree with some of the other posters. (I didn't read them all.) They are indeed bluffing. Tell the debt collector your situation (if you haven't already.) They have to document what you tell them. If you are able, make an arraignment with them to make a payment, no matter how small.

If they get a judgement against you, they can garnish your bank account but they cannot garnish your wages. They could get any money deposited into your bank account, though. I wonder if its just a threat as that is not much money owed to sue over, IMO.