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Going to Court for Credit Card Debt — Key Tips

Don’t Panic, We’ve Got Your Back

Getting sued over credit card debt can feel like the world is crashing down; but don’t worry, it happens to tons of people – and there are ways to deal with it. We’re here to walk you through the whole messy process, and give you tips on how to handle it like a pro.First things first, take a deep breath. You’re not going to jail over this, no matter what those aggressive debt collectors might threaten. Debt from credit cards or loans is considered “civil debt”, which means it’s just a dispute over money, not a criminal case. So relax, you’re not about to get locked up.That said, you can’t just ignore the lawsuit either. Doing nothing means the court will automatically rule in favor of the creditor, and then they can pursue aggressive collection tactics like garnishing your wages or putting liens on your property. Yikes, right? But don’t stress, there are smart ways to respond and protect yourself.Quora link on being sued for debtReddit link on being sued for credit card debt

The Most Important Step? Respond to That Summons!

We can’t stress this enough – the biggest mistake you can make is doing nothing when you get summoned to court over credit card debt. Ignoring those letters is basically surrendering and letting the creditor win by default.When you get served with a summons and complaint, read through it carefully. It will tell you how long you have to file an official response, usually around 20-30 days. Don’t miss this window! Responding, even briefly saying you dispute the debt, buys you critical time.Now some tips on how to properly respond:

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  • Get the court forms: Most courts have fill-in-the-blank “answer” forms to respond to a summons. You can get these online or from the court clerk.
  • Raise any defenses: In the answer, list any reasons you don’t think you owe the full debt, like missed payments already paid or errors in the creditor’s records. Admit things you know are true, deny what you dispute.
  • Include documentation: Attach any statements, receipts, or records you have about payments made towards the debt. More evidence is better.
  • Meet all deadlines: Make sure you get your response filed by the deadline! Being even one day late can mess everything up.
  • Serve the creditor too: After filing with the court, you have to provide a copy of your response to the creditor’s lawyers as well, which is called “serving” them.

Avvo link on responding to a debt summonsLawinfo link on answering a debt collection lawsuitPhew, I know filing a legal response sounds intimidating, but you’ve got this! Just follow those steps closely. And if you get stuck or need help, you can always hire an affordable debt defense lawyer to make sure it’s done properly.

Understand Your Rights and Defenses

So you’ve responded and bought yourself some time – nice work! Now it’s time to build your defense strategy for when the case goes to court. Don’t just roll over, because you may have more leverage than you think.First off, understand that the burden of proof is on the creditor to show you legitimately owe the debt they claim. They need to provide the original credit agreement and records of all transactions – amounts borrowed, payments made, interest charges, everything. If their records are incomplete or seem fishy, you can object.There are also certain legal defenses you may be able to use to get the debt dismissed entirely:Statute of Limitations

  • In most states, creditors only have a limited number of years to sue over a debt, usually 3-6 years from your last payment
  • After the “statute of limitations” runs out, you can argue the debt is too old and they can’t collect
  • But be careful, reviving the debt with a new payment can restart the clock

Lack of Standing

  • The creditor suing you may not actually own the debt anymore if it was sold to a third-party
  • You can demand they show proof they have the legal “standing” to collect the debt
  • Many cases get dismissed when debt-buyers can’t prove their ownership

Violations by Creditors

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  • If creditors harassed you, failed to validate the debt properly, or broke other debt collection laws
  • You may be able to get the case dismissed as a penalty for their violations

FindLaw article on debt collection lawsuits and defensesThere are other potential defenses too, like identity errors if it’s not your debt, or bankruptcy discharges. The key is, don’t just assume you have no options! Creditors are counting on you to just roll over.

Consider Settling – The Smart Way

Of course, your ultimate goal is to get that pesky debt off your back for good. And in many cases, settling out of court can be the smartest solution – if you negotiate carefully.Creditors know court battles can be costly and time-consuming, so they’re often motivated to settle if you can make a reasonable lump-sum offer. A common tactic is trying to settle for 40-60% of the outstanding balance.But don’t just blurt out a number! You need to approach it with care:

  • Wait until you’re close to a court date to negotiate – creditors get more flexible as it looms
  • Understand your state’s laws on “debt re-aging” – some restart the clock if you re-confirm the debt
  • Get any settlement terms in writing before paying to avoid future headaches
  • Demand the creditor agrees to stop reporting the debt and clear it from your credit
  • Consider bringing in a professional debt settlement firm to negotiate for you

Quora thread on negotiating credit card debt settlementsReddit guide to settling credit card debtSettling for less than the full balance can save you big money and get this debt off your plate for good. Just be smart about it and don’t let creditors take advantage of you.

When Bankruptcy May Be Your Best Option

For some people, bankruptcy is the most realistic way to get out from under crushing credit card debt. It’s not an easy choice, but it gives you a court-approved fresh start.In a Chapter 7 bankruptcy, your credit card debts can be fully discharged, meaning you’re no longer legally obligated to pay them. Your liability is wiped out completely.With a Chapter 13, you get some breathing room by restructuring your debts into a multi-year repayment plan you can actually afford based on your income.FindLaw overview of Chapter 7 vs Chapter 13 bankruptcyNow bankruptcy isn’t a magic wand – it does heavily impact your credit score for 7-10 years. But it also stops debt lawsuits and collection harassment in their tracks. For many, that relief is worth the credit hit when they’re drowning in debt.If you’re considering bankruptcy, it’s wise to consult a local bankruptcy lawyer. They can review your full financial picture and advise if it’s your best option compared to alternatives like debt settlement.

Don’t Let Debt Collectors Scare You

Look, debt collectors know their whole business relies on pushing people around and making empty threats. They try to bully and intimidate so you’ll just give in.But here’s the truth – they have absolutely no power to arrest you or put you in jail over unpaid credit card debt. It’s an empty scare tactic used to make you feel desperate.Under the Fair Debt Collection Practices Act, it’s illegal for debt collectors to falsely threaten arrest, lawsuits they don’t intend to file, or any other misleading statements. You can and should report violations like this.FTC guide on your rights under the Fair Debt Collection Practices ActAvvo article on debt collector harassment and FDCPA violationsOther common illegal collector behaviors to watch out for:

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  • Calling before 8am or after 9pm
  • Contacting you at work if you’ve told them not to
  • Using profane or abusive language
  • Failing to identify themselves as debt collectors

If a collector does any of those things, send them a written notice telling them to stop. Under the FDCPA, that forces them to communicate only through your lawyer going forward.The bottom line – know your rights and don’t be intimidated by unscrupulous collector tactics. With the right knowledge and defenses, you can resolve this.

Key Takeaways on Handling a Credit Card Lawsuit

We’ve covered a lot of ground, but here are the key points to take away:

  • Never, ever ignore a summons for debt – always respond!
  • Raise any legitimate defenses like expired statute of limitations
  • Consider negotiating a settlement, but be smart about it
  • Bankruptcy may be an option for a true fresh start
  • Debt collectors have no power to arrest you – report violations!

Getting sued is stressful, but you’ve got this! Defend yourself properly, understand your rights, and explore all options from settlement to bankruptcy. You don’t have to just roll over for aggressive creditors.

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