I am a home owner and was unemployed for a year or so. Only reason i wasnt making payments.
No. You need to contact the Attorney representing the creditor first to find out the amount you need to pay in order for the lawsuit to be dismissed/withdrawn.
My answers here are for general information only and should not be construed to be formal legal advice or the formation of an Attorney-Client relationship. I am not your Attorney. You should always consult with a local Attorney before taking any action based on the general information provided by me on this site. I practice law only in jurisdictions I am properly authorized to do so and do not seek to represent anyone outside the jurisdictions where I have been licensed to practice law. Currently, I am licensed to practice law in the Commonwealth of Massachusetts and the State of New York.
If sued, read the summons, you have a deadline to respond. Failure to file an answer means really terrible things. Default, exactly what they want and then potentially garnishment.
If your loan has been declared in default, simply making payment will not "reinstate" it. You can try to settle the debt or consult with a bankruptcy attorney. Bankruptcy may or may not be a good option for you, but don't start making payments until you speak to one. If you need to challenge the complaint, make sure to file an answer within 20 days.
Information applicable in Washington State. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship. Arrow Law Group, PLLC is a debt relief agency as defined by the United States Bankruptcy Code. We help people file for relief under Chapter 7 and Chapter 13 of the United States Bankruptcy Code.
A court summons requires you to respond with an answer to the underlying complaint. In Washington, the deadline is twenty days. If you do not respond within this time period, a default judgment could be entered against you. Once a judgment is obtained, the creditor will be able to pursue other options such as wage garnishments and bank levies. To ensure your rights in the litigation are preserved, you should file an answer immediately. In this vein, you may want to consult an attorney. However, it is possible to do this pro se, as there are multiple resources available to similarly situated debtors.
Once your answer has been filed, I recommend that you reach out to the attorney representing the creditor. The creditor may be open to a payment plan of some sort. However, the amount may be more than the underlying principal on the credit card debt. This is because of accrued interest and fees (e.g. interest, costs of the suit, attorney's fees). The underlying complaint should have a breakdown of the amount sought. Use this amount as the basis for any negotiations.
In many cases, the creditor's interests are being pursued by its assignee, a collection agency. To preserve the rights of the creditor, sometimes the agency will not be open to a payment plan until after a judgment is obtained. If this is the case, and if you have the resources available, an offer of a lump sum settlement can usually encourage them to negotiate. In any case, be it before or after judgment, make sure that you get a signed settlement agreement. Furthermore, make sure that the agreement states that no further collection action will take place provided you are in adherence to the payment plan. This will prevent any surprises (e.g. your bank account; your wages garnished).
If this debt is with a collection agency, do not make payments to the creditor directly. In this situation, because the debt is assigned, the collection agency and its attorney are who you should work with. Any payments made to the creditor directly will likely be returned to you.
I suggest you contact the attorneys representing the Creditor. If you are interested in arranging a payment plan, most attorneys will enter into a stipulated settlement and depending on your State's specific Court rules, may dismiss the underlying law suit. The best course of action, is to be in contact with both the Court and the Plaintiff's attorney.
Information provided on this site are for general informational purposes only, they are not to be relied upon as legal advice and are not a substitute for consulting an attorney licensed in your state. As I am licensed to practice law only in the State of Maryland, the information provided may actually be incorrect as it relates to your specific State. No attorney-client relationship is created as a result of the information being provided. It is strongly suggested that you consult with an attorney who is licensed in your State and has experience in this practice area.
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