How does my daughter defend a credit card debt lawsuit with no attorney?
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Answer:
When a person is served with a complaint for a debt, he needs to file an answer to the complaint within the specified time, or else the plaintiff will win a default, or automatic, judgment in its favor. If the plaintiff gets a judgment against you for money and you are unable to pay it, the plaintiff can ask the court to create a judgment lien, and assets, such as bank accounts, can be attached, wages may be garnished, etc.
At a hearing, the defendant should appear on time and be properly dressed. Any documentation regarding the debts should be brought, such as receipts, billing statements, letters, memos, etc. The most common defenses to collection of a credit card debt include The most common are the statute of limitations, statute of frauds, waiver, estoppel, improper plaintiff, improper defendant, invalid debt transfer, violation of bankruptcy discharge, and violation of the Fair Debt Collection Practices Act. The defendant should address the court in a respectful manner and state the facts in a calm and succinct manner, avoiding being long-winded. Outbursts of temper should be avoided.
In some cases, a debtor may be able to negotiate a settlement with the debtor, although this is more difficult once a suit has been filed. In some cases, the creditor may settle for a lesser amount if the debtor is insolvent, since a promise to pay something is better than collecting nothing. These types of agreements are called an accord and satisfaction. If it is possible, a debtor should get a release included in such an agreement so that the creditor may not pursue the full balance of the debt claimed.
Anyone considering filing bankruptcy should first evaluate all of the potential alternatives, and then make an informed decision regarding whether bankruptcy is the best choice. It should be stressed that this is a personal decision for each individual. There is no one answer that is right for everyone. Only by carefully exploring all of the alternatives may a person truly know whether bankruptcy is the best solution to their debt problems.
Prior to making a decision to file bankruptcy, each individual should first attempt to contact his or her creditors and determine whether it is possible to obtain their cooperation in working out a different payment schedule. Most people would be surprised to learn that creditors often are willing to make reasonable modifications to assist the debtor in repayment. Communication and honesty are the key words here. In exploring this option, the creditor should be honest and forthright with the creditor regarding one's financial situation.
The debtor should also take a close look at his or her assets. If any have a resale value, consider whether a sale of those assets and the application of the proceeds of the sale to one's debt may reduce the debt to a more manageable level. Often, after the sale of one or more personal assets, debt is reduced to a level which makes bankruptcy a less attractive option.
Another option to explore, which may not be available to every debtor, is a consolidation loan. It may be possible for some debtors to obtain a consolidation loan to repay one's debt, which very often will result in lower overall payments.
Another option to examine is Consumer Credit Counseling Service. CCC is a nationwide nonprofit organization that attempts to work with both the debtor and his or her creditors to devise a more manageable repayment plan. This service very often results in revised payment plans which are acceptable to both the debtor and the creditor, thereby eliminating the need to file bankruptcy.
The automatic stay is one of the most valuable functions of a bankruptcy proceeding for the debtor seeking relief from creditors. The automatic stay immediately stops any lawsuit filed against you and virtually all actions against your property by a creditor, collection agency or government entity and provides an injunction against the continuance of any action by any creditor against the debtor or the debtor's property. After filing for bankruptcy, the automatic stay will prevent creditors from calling and harassing the debtor in any way. In fact, should a creditor continue to attempt to contact the debtor during the automatic stay, that creditor could be held liable for damages.
Federal bankruptcy laws provide a private cause of action for an individual injured by any willful violation of the automatic stay. The injured individual is entitled to recover actual damages, including costs and attorney's fees. Punitive damages are awarded when the actions taken by the creditor are particularly egregious and there is a showing of actual damage.
After 10 years, the bankruptcy must be dropped from your credit report. The policy of the Associated Credit Bureaus is to remove Chapter 11 and Chapter 13 cases from credit reports after 7 years to encourage debtors to file under these chapters. It is possible to have the information removed before the 10 years is up. If credit bureaus failed to timely verify the information with the court clerk, and you initially disputed the information as erroneous, under the Fair Credit Reporting Act (FCRA), unverified information must be deleted. If you suspect your public records have not been verified by the court, ask the credit bureau to provide you an explanation of how they verified. If your records are not removed by the credit reporting agencies automatically, you can send a letter of dispute to have the records taken off your report.
A judgment lien is a court ordered lien that is placed against the home or property when the person (judgment debtor) fails to pay a judgment against him or her. A creditor can ask the court to place a judgment lien on the debtor's property after winning a judgment for money owed and the judgment remains unpaid. If the court decides that the creditor is owed the money, and the judgment debtor will not or cannot make payment, the judge will order that a judgment lien be placed against the property. A court may order assets such as bank accounts and other property to be attached, or wages or other income to be garnished.
