Credit Card Debt Lawsuit (CM2025-02)

[C.M.]

Jurisdiction

Maine

This week I was served with a lawsuit for an unpaid credit card debt that is about $2,700 and I want to know how to best proceed.

I want to know if I were to make an offer to settle the debt for a reduced amount of around 50% to be paid on a monthly basis if I'm doing so I would lose any protections such as the right to seek bankruptcy protection should the attorney bringing the lawsuit against me reject my offer and insist on the full amount.

I have no assets other than 1 8yo car, I rent my home and have not significant savings.

I do have a vacation coming up but that is not refundable or transferable. I know that does not look good but it was also a gift from our in-laws. The card debt is many years old and was the result of me becoming seriously ill from which to this day I have high monthly medical expenses for life saving medications.

I was out of work for almost 6mo without warning when I became sick and as a result fell behind on many responsibilities. Some worked with me and froze my repayments till I was able to resume payments but this creditor fell through the cracks, in part due to lack of sending me notices. They never sold the debt so I never got the typical sleazy debt collection phone calls and such. I heard nothing till this lawsuit.

 

[zddoodah]

I want to know if I were to make an offer to settle the debt for a reduced amount of around 50% to be paid on a monthly basis if I'm doing so I would lose any protections such as the right to seek bankruptcy protection should the attorney bringing the lawsuit against me reject my offer and insist on the full amount.

Making an offer to settle would not impact your ability to file BK.

 

[Redemptionman]

and if you are facing multiple cards or defaults then a debt consolidation firm could be of help as well.

They will settle your debts for pennies on the dollar and represent you in any lawsuits filed regarding that debt.

 

[C.M.]

Thank you both for taking the time to respond. I just have a couple of follow up questions...

1) Do I send my request for an out of court settlement to the plaintiff's attorney, or do I send it to the court that will be hearing my case if I went to challenge the debt, or do I need to send it to both?

2) Can I get some recommendations on such companies that might be able to help me with the settlement process. I just did a quick google and the couple that I just looked at talked about furnishing me with the forms I will need to send out, but their site said they cannot provide legal advice, and I would need to hire an attorney. This does not sound like the level of service mentioned above.

 

[Redemptionman]

Thank you both for taking the time to respond. I just have a couple of follow up questions...

1) Do I send my request for an out of court settlement to the plaintiff's attorney, or do I send it to the court that will be hearing my case if I went to challenge the debt, or do I need to send it to both?

2) Can I get some recommendations on such companies that might be able to help me with the settlement process. I just did a quick google and the couple that I just looked at talked about furnishing me with the forms I will need to send out, but their site said they cannot provide legal advice, and I would need to hire an attorney. This does not sound like the level of service mentioned above.

1. If you are able to settle the debt with the collector without going to court then get a release before you pay them or send them the funds.

2. there are so many financial debt consolidation companies out there that a list would be huge. They are all not rated very highly because lets face it they are dealing with insolvent people who have bills they can not pay. You basically want to find the lesser evil ones out there. They will in most cases write the responses to court filings for you if they don't find one that will. You can see that from the reviews and ratings the company you are researching receives

GL with it

 

[zddoodah]

Do I send my request for an out of court settlement to the plaintiff's attorney, or do I send it to the court that will be hearing my case if I went to challenge the debt, or do I need to send it to both?

If you want to settle, that's between you and the plaintiff's attorney. If you want to file a responsive pleading, you do that with the court. If you make a settlement proposal, be mindful of your deadline to file a responsive pleading. The plaintiff's attorney may be willing to give you an extension to respond while you're discussing settlement.

Can I get some recommendations on such companies....

Nope (and I've never heard of a settlement company that will also provide an attorney to represent you in litigation).