Credit Card Debts

Overwhelming credit card debt is one of the most common financial challenges for people in Florida and all across the United States. Late fees, rising interest rates and harassing phone calls from creditors are making credit card debt unmanageable for many people.

In some cases, filing bankruptcy is the only way to escape the downward spiral of mounting debts.

In other cases, people can avoid bankruptcy by settling debts, defending or settling lawsuits, or filing claims of exemption. Proper management of exempt income and assets is essential to protect exempt assets as well as settling with creditors.

Here are some options to know:

If a lawsuit has been filed

Once you are served with the summons, the clock is ticking. How much time is determined by the summons?

If you do not file an answer with affirmative defense and/or motion to dismiss or appear at the Small Claims pre-trial in the time specified in the summons, a default will most likely follow.

A proper response will stop a default and require the party suing to bring their full case to the court. Some cases require on-going discovery and litigation designed to make the plaintiff prove their case. To be entitled to a judgment, they should be made to prove their case.

Defenses that may apply

The following defenses may apply depending on the circumstances:

  • They failed to meet the requirements of 15 USC § 1642 requiring an application of credit
  • There is no assignment or an incomplete assignment of the debt
  • Usury and or loan sharking rates were charged*
  • They are suing the wrong person
  • The debt was settled or discharged in bankruptcy
  • There is a dispute as to the amount
  • There is a counterclaim for unfair collection practice
  • Identity theft
  • Statute of limitations
  • Violation of lending laws

Looking at your big picture

Many times a person has more than one debt to consider. In dealing with individual credit card cases, it is important to consider the big picture. Can you afford the settlement which they offer? If you take the settlement, what will happen to your other debts? Do you really want to pay a lump sum settlement before filing bankruptcy? Probably not. But these are just a few questions you might want to ask. Knowing the big picture and having an overall plan gives you strategy and a direction to work toward. See an attorney who can help you make that plan and strategy.

Dealing with short term emergencies

Some short term emergencies include but are not limited to:

  • Garnishment of wages
  • Garnishment of accounts
  • Harassment
  • Judgments
  • Orders from the court to provide financial information
  • Sheriff’s sale of personal property

Are you being harassed?

The following are acts by collectors which might be actionable for statutory damages (up to $1,000) and/or actual or punitive damages.

  • Trying to collect a debt from the debtor after the person knows that they are represented by an attorney for that debt
  • Calling before 8 AM or after 9 PM
  • Contacting your employer
  • Pretending to be law enforcement when they are not
  • Threatening to put you in jail if you do not pay. (You can be put in jail for not following a contempt order from the court to provide financial information, but there needs to be a judgment and an actual order from the court.)
  • Calling too many times
  • Calling when they know you cannot afford to pay

Documenting violations

The better the documentation, the better your chances of proving your claim.

  • Talk to your attorney to discuss how to document the violations.
  • Understand the elements that need to be proved in order to prevail in court and how to collect the proof.
  • Know how to inform them of your representation.
  • Be honest and accurate.

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