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Credit card debt can become overwhelming. Interest, fees and penalties can add hundreds or thousands to the amounts you borrowed and are expected to repay. What if you are unable to continue making your credit card payments, or if your payments are simply too much to handle? When you miss a credit card payment, you are considered in default of your accountholder agreement. Defaulting on credit card debt can have consequences, including, collection calls, collection letters, negative credit reporting, lawsuits, judgments, and even garnishment.
What are your options? Whether you have already defaulted on your credit card debt, or are planning to default, it is imperative to plan ahead. After defaulting on debt you are subject to collections and legal action. It is imperative to speak to a knowledgeable consumer law attorney to learn about your rights under federal consumer protection laws incuding the Fair Debt Collection Practices Act and Telephone Consumer Protection Act. Sometimes creditors and debt collectors violate these laws, and you may be entitled seek damages that can reduce or eliminate your debt altogether. For some, bankruptcy is a good option. If you have a high amount of total debt, minimal assets and modest income you may be a good candidate for chapter 7 bankruptcy. Filing bankruptcy can allow you to eliminate credit card and other debts without having to pay these debts back. For others, debt settlement can be a good alternative. Although creditors are under no obligation to accept a settlement, debt settlements can be achieved when an individual can show a financial hardship and the means to pay a lump sum or installment payments for less than the full amount of the debt. One of the main benefits of a debt settlement is you can avoid filing bankruptcy. Many creditors will accept anywhere between 20-40% of the total debt, while others require higher amounts. The results will vary depending on your individual circumstances so you should consult a knowledegable debt settlement lawyer. Doing nothing is the worst thing you can do. Not only can you miss out on potential claims you may have for violations of federal consumer protection laws, but you leave yourself open to the risk of lawsuits, judgments, wage garnishments, and tax refund garnishment. Hadous|Co. attorneys are skilled consumer protection litigators. We never charge you for a consultation. We want to earn your trust and are confident that we can help you get out of debt and start fresh. Contact our office at (313) 415-5559 to schedule a free consultation. After filing bankruptcy, an automatic stay arises by operation of law that prevents your creditors or other debt collectors from attempting to collect debts. You can think of the automatic stay in bankruptcy as a "time-out."
If you obtain a bankruptcy discharge of your debts, your creditors will not be allowed to attempt to collect debts that were discharged in bankruptcy. However, what if a creditor or collector attempts to collect a debt that was discharged in bankruptcy? Know your rights. Collection after bankruptcy is becoming increasingly common, as debt buyers or other third parties assigned your debt attempt to squeeze payments from you. Your discharged debt can be sold for pennies on the dollar. Sometimes, collectors will call or send you collection letters threatening to report you to the credit bureaus (national consumer reporting agencies). In some instances, unscrupulous collectors will actually report you to the credit bureaus for a debt that was discharged in bankruptcy. This can be extremely distressing, and you should consult a knowledgeable consumer lawyer. The collector can be held in contempt of the Bankruptcy Court Order of Discharge for attempting to collect a discharged debt. The collector can also be found liable for damages under Fair Debt Consumer Protection Act (FDCPA) and the Fair Credit Reporting Act (FCRA). If you filed for bankruptcy and obtained a bankruptcy discharge, you are entitled to peace of mind and to a fresh financial start. Unscrupulous debt collectors threaten these. You should consult a knowledgeable consumer attorney if a collector contacts you to collect a debt that was discharged in bankruptcy. We regularly represent consumers in actions for damages against unscrupulous debt collectors. We invite you to contact us directly, or to visit us online to learn more: Fair Debt Collection Practices Act. |
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May 2024
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