How to Deal with a Debt Lawsuit

by Gary on February 25, 2013

Are you facing a lawsuit because of debt that you owe?  Your bank, a credit card company, or other business may have just served you with legal papers indicating that they are using the court to collect. For many Dallas residents, these sorts of debt claims are the first time they have ever dealt with the legal system. It can be a stressful and confusing process.

But no matter how much you owe or what your circumstances, please know that things are not hopeless. There are various options to defend against the suit, work on a settlement, or arrange for protection from excessive debt. The important thing is to reach out to a debt lawsuit attorney to share your story and learn what can be done.

Who is suing you?

One of the most important first steps is to identify who is suing you and for what specific account.  Sometimes lawsuits are filed by original creditors (i.e. the companies who from which you originally borrowed).  Some of the most common are banks and credit card companies like American Express, Citibank, JPMorganChase, Discover Bank, Capital One Bank, HSBC, Target National Bank, FIA Card Services (aka Bank of America), Ford Motor Credit, Ally Financial.

Before filing the lawsuit these creditors likely called your home, work, or even family members. They likely also sent many letters trying to get you to send money. Because of this you may already know what specific amounts they claim you owe. However, if you are not sure, the legal documents you receive notifying you of the suit should indicate the accounts which are the basis of the suit.

How should you respond?

When you learn about a debt collection lawsuit it is critical to act in a timely fashion to retain legal assistance. An attorney can review your specific situation and explain your options. In general, the best course is usually to put forth substantive defenses challenging the creditor’s right to prevail in the lawsuit or to work directly with the creditor to arrange a settlement. Many community members are unaware of the ability to work with the company to arrange a payment deduction or payment plan that is feasible for your financial circumstances.

What if you are buried in debt?

Sometimes the debt at the center of a lawsuit is just one of many different obligations that one owes and is struggling to repay. In those situations it might be appropriate to consider whether options like bankruptcy might be prudent. While it comes with unfortunate connotations, bankruptcy is actually a smart move in many cases to get out from under heavy financial burdens and start fresh.

For help with these and any similar issues in our area please contact the Dallas debt attorneys at Armstrong Kellett Bartholow P.C.

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