I owe $4,000 to a credit card. Unfortunately, due to circumstances out of my control (medical), I hired a consolidation company. The consolidation company called this credit card co. many times about the debt. No realistic resolution happened (i.e. they wanted $500 dollars a week!!) and then months later, I got a letter from a lawyer representing the credit card co.
Again, the consolidation company tried to work with the lawyer. Everything is documented. Again, no realistic solution ever happened. Now I got a civil summons from the lawyer.
My questions are:
-Can they sue me when I am in consolidation?
-Should I mention in court that the consolidation company called them many times & would not settle or willing to do a payment plan? (i.e. bring documentation)
- If I lose, will I be forced to pay? If so can I pay in monthly payments? What happens if I don't pay?
-Overall, wouldn't it have been cheaper if the credit card co. just settled with the consolidation co and didn't hire the lawyer?
- Can I delay the court date?
Thank you for any advice you can give.
Yes, they can call you if the "consolidation company" is not a licensed NC attorney. This is the downside of using debt settlement or consolidation companies. They cannot stop the calls or the lawsuits. Yes, they can sue you. No creditor is "required" to "work with you" even if it could be cheaper to do so. No creditor can be forced to accept a settlement or a payment plan. This is the lie that these debt settlement or consolidation companies tell you when you sign up. Some creditors are harder to deal with than others. You can delay the court date if you are sued by asking for an extension of time and then filing a written answer after you are sued, but if you have no legal defenses, they wille ventually get a judgment against you. Working with a consolidation or settlement company is NOT a legal defense, nor is financial hardship. You can do a pay plan for a settlement, but they may insist that a judgment be entered which will be cancelled once you pay the settlement. Judgments are public record, and even after they are paid they may still show up on a credit report for 10 years. PLEASE go to a consumer bankruptcy attorney for specific advice ASAP. I have filed bankruptcies for many people who wasted time and money on debt settlement companies and could have been on the road to recovery sooner had they filed bankruptcy from the start. A consumer bankruptcy attorney will explain all non bankruptcy and bankruptcy alternatives for handling your debt issues, and some may defend your debt lawsuit in the process. Most offer free consultations. There are many good consumer bankruptcy attorneys in Charlotte. Use the Find a Lawyer feature here or use the attorney locator at www.nacba.org and by all means do not let your "consolidation company" hire you a lawyer. Contact your own lawyer now.
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Ms. Coleman gave you an excellent answer. I could recite my clients' experiences with debt consolidation but it would not add to Ms. Coleman's answer. Take her advice and schedule some consultations with one of the excellent bankruptcy attorneys in Charlotte.
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