What to do when faced with a credit card lawsuit

credit card lawsuit

What to do when faced with a credit card lawsuit

1 1 Cynthia Conlin

You may have known it was coming but hoped it wouldn’t. Paying bills has been a struggle. You got behind. Now you are faced with a credit card lawsuit, and a process server has handed you a summons and complaint. What do you do?

Do not ignore it

Most importantly, take the lawsuit seriously. It will not go away if you ignore it. You may have ignored the bills, the collection letters, and the calls, but this is the real deal. This is litigation.

If you ignore it and fail to respond as required by the rules of civil procedure, the court will enter a default against you. The default will turn into a judgment for more money than you borrowed and more than your biggest bill was. Not only will there be late fees, interest fees, and more, but there will probably also be attorney’s fees and court costs.

A judgment can affect you in multiple ways. First, it will harm your credit. In the future, reminders may appear if you try to buy a house or engage in any other purchase that requires credit. Second, the creditor will be able to collect on it for years to come —in some cases up to 20 years. When you least expect it, perhaps after things have been going well for you, the creditor may quietly swoop in and garnish your bank account — or your wages. Its attorneys will not care if you have been saving to buy your children Christmas presents or if you need to pay other bills. They just want to collect what’s in the account. The creditor can also seize assets, such as your car or any property that is not exempt.

You may have defenses you never knew

When clients come to us after receiving a credit card lawsuit, the first thing we do is examine the complaint. Often, defects on the face of the pleading itself are vulnerable to attack. While most defects are small, occasionally they are fatal.

Sometimes there are issues related to assignment, where the creditor sold the debt to another company but a sufficient paper trail is lacking. Other issues may relate to statutes of limitation, choice of law, or special clauses in the credit-card agreement. Others relate to the way the lawsuit is pleaded. Essentially, as a sued debtor, you may never know what defenses could be presented unless a trained attorney examines the lawsuit.

In some cases, presenting those defenses will show the creditor you mean business, you won’t just take it without a fight. This in itself, knowing that the creditor is up for a fight, give you leverage so you can settle for a reasonable amount. And, in a small portion of cases, the defenses are so strong that the case may eventually go away completely.

You can probably negotiate a settlement

Next, in almost all cases the creditor is willing to negotiate a settlement. When you do negotiate a settlement, it is wise to have an attorney supervise it and help jointly draft it. A settlement agreement that is drafted in the favor of the creditor, with no input from your attorney, will give the creditor the most rights and you the least.

Have you been served with a credit card lawsuit?

In summary, if you are served with a summons and complaint suing you for credit card debt, before you throw those papers in the garbage, seek council.

If you would like a consultation on your credit card lawsuit, call Cynthia Conlin & Associates at 407-965-5519 or contact us here. You can also schedule a consultation on Attorney Conlin’s personal calendar here.

Cynthia Conlin

Cynthia Conlin is the lead attorney at the Law Office of Cynthia Conlin, P.A., an Orlando law firm focusing on assisting businesses and individuals with litigation needs.

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