Combined data taken from the U.S. Census Bureau and the Federal Reserve found that in 2016, credit card debt for the average American household was about $5,700. Sometimes, credit card companies try to collect outstanding debts by filing a lawsuit against the debtor. The debt collector will either be the credit card company or a third-party collection agency. Taking the terms of the lawsuit at face value is not always the best choice, in some cases there could be differences in the collection terms when first getting the credit card. It may be your gut instinct to try to ignore the lawsuit, but if you fail to show up in court, an automatic victory will be awarded to the credit collection agency.
How to Fight Back Against Creditor Lawsuits
- Renegotiate with creditors: You may be able to contact your creditor and attempt to renegotiate a more manageable repayment strategy for your debt. This will likely be difficult to do.
- Declaring bankruptcy: In some cases, letting the creditor know you may have to declare bankruptcy on your debt will cause them to ease their grip. If the debt is at a very unmanageable level, declaring bankruptcy could be the best option for you to start climbing out of debt.
- Predatory lending practices: Baiting in borrowers with excessively high interest rates, unforeseeable surcharges and fees, and allowing borrowers to borrow too much can be illegal. A bankruptcy attorney will be able to review your lending terms to see how they apply to your debt, and if any predatory lending was involved.
Lewisville debt settlement attorneys at Julian, Crowder & Shuster law firm can help you get the best options in negotiating debt repayment with your creditors.