What to Do If You Are Being Sued by A Credit Card Company

Credit card debt is an issue that plagues so many people today, especially during these difficult economic times.  What starts as annoying collection calls eventually turns into legal actions by the credit card company or a third-party debt collector.

American Express, Discover Bank, Bank of America, and Capital One lawsuits are all common. Then you have lawsuits from Portfolio Recovery, Midland Funding, CACH LLC, LVNV Funding, Cavalry SPV, and the list goes on and on. These are debt purchasers. As a debt lawsuit attorney, I represent clients in all of these lawsuits and have done so for more than ten years. I don’t judge my clients or why it wasn’t paid. My focus is on what we are going to do now to resolve it.

If you receive a summons in the mail showing that your credit card company has sued you to collect on a debt, do not ignore it. It is important that you know what is involved in a legal action to collect on a debt and how to respond if you are on the receiving end.

My suggestion is that this is when you should call me to discuss the pros and cons of whether you should get legal representation for the lawsuit or consider filing bankruptcy. Oftentimes, being sued for a debt is a sign of other things to come. Sometimes it makes more sense to wipe out all your debts while keeping your cars and your home.

Florida’s statute of limitations is five years for debts that include personal loans and written contracts. However, for credit card debt, the timeline is four years from the date of last payment on the debt, which will influence how soon the credit card company files a lawsuit.

Once the lawsuit is filed and you have been served with a summons, you usually have between 20 to 30 days from the date on the notice to file an answer. We cannot emphasize enough just how important it is to respond to the lawsuit in a timely manner. If you do not, you run the risk of the court giving the creditor a default judgement, automatically ruling in their favor. This judgment will only make the process quicker and allow the creditor to garnish your wages or bank account for payment. By responding, you are getting your chance to state your side of the case.

We recommend that consumers hire an attorney to help them respond to the lawsuit, but if you do not, you need to know what to say in your response. You will need to first verify the debt and how much is owed. You have the right to request documentation on the debt to ensure that the amount they are quoting is correct, and if it is not, provide the correct amount in your response. In your response, you can also request a settlement on the amount owed. The credit card company may prefer this option since it also saves them time and money on legal fees and makes the process quicker. A settlement can involve a payment plan or a lump sum payment for a reduced amount. If you are unsure of what to do in a settlement, we recommend consulting an attorney before working with the creditor to ensure that your rights are protected.

If the creditor has filed the lawsuit after the statute of limitations has expired, file a response with this defense and provide proof of when the last payment on the account was made. If you decide to fight the lawsuit, and the lawsuit is over $5,000, you will have a 20-day deadline to file a response to the lawsuit.

Writing a letter saying you couldn’t pay because you lost a job or someone became ill is NOT a proper response and actually will serve as admitting the debt and making the job a lot easier for the law firm suing you. I recommend you hire a lawyer to handle the matter. We typically work with these debt collectors daily and can try to obtain the best possible outcome for you.

In some situations, you may simply not have the money to pay on the debt. If you are in a dire financial situation with no money to fight the lawsuit or pay the debt, bankruptcy may be the best option for you. Speak with a bankruptcy attorney to understand what is involved and determine whether this option is best for you. Depending on your situation, filing for bankruptcy can be an excellent option for completely wiping out the debt, especially if it is unsecured credit card debt.

If you have questions on this topic or are struggling with debt, call us today to schedule a free consultation. The Benenati Law Firm has eliminated nearly a billion dollars of debt for its bankruptcy clients, making the firm one of the top twenty filers of bankruptcy in the nation. We have helped thousands of individuals and families eliminate their debt and get a fresh start financially. The day you hire our firm, we will contact your creditors to stop the harassment and collection calls. We make our hours convenient for our clients and offer FREE digital sign-ups and free consultations on Saturdays (9:00 a.m. – 3:00 p.m.) and throughout the week until 5:00 p.m. If you are in a financial crisis and considering filing for bankruptcy, contact an experienced Orlando bankruptcy attorney who can advise you of all of your options.