Make it Harder for Debt Collectors and Creditors to Sue You
Are you afraid of being sued over your delinquent credit card bill, hospital bill or payday loan? There is a tactic you can use to significantly reduce your odds of being sued and win the judge over if you are sued. Here's how --
First of all, don't assume that you will lose in court if you are sued. Judges have been known to dismiss suits filed by creditors, even if they can prove the debt is valid. In any event, you can try to get the judge on your side and reduce your odds of being sued by doing the following --
Write the debt collector / creditor and tell them you can afford to send them X dollars each month. Sample letters are included in this section. This amount should be large enough so that the debt can be paid off in a two or three year period at most. Send this offer by certified mail, return receipt requested. They might reject your offer and demand payment in full, but regardless of whether they agree to your terms or not, send in whatever you told them you would each month anyway. Even if they reject your partial payments and send each one back to you uncashed, keep sending them payments each month just as you told them you would. Send each one certified mail, and keep receipts and copies of everything, including the envelope used to send the payment back to you.
Why do the above? If your account is turned over to an attorney for litigation, you will simply send him or her a letter claiming that you tried to pay off the debt but the creditor (collector) wouldn't accept your payments. Send copies of your records proving this to the attorney. Don't send the originals -- only the copies. List in your letter the dates that payments were sent and the total that you've tried to send the creditor. Be sure the attorney knows that you sent these payments by certified mail.
An experienced collection attorney knows that you have made an effort to pay and will be able to prove this in court. All trial attorneys know that judges do not like their time wasted with unnecessary lawsuits. If you presented proof in court that you sent partial payments in an attempt to pay off the debt, the judge will likely become angry at the plaintiff's attorney and chastise him for wasting the court's time. If he's angry enough, perhaps he will even dismiss the plaintiff's lawsuit. You might even get your obligation to pay the debt dismissed altogether.
What is likely to happen after the collection attorney has become aware of your attempt to make payment is that he will probably decline to file suit and will advise the original creditor to work out some sort of agreement with you. And even if he does file suit, you have some good ammunition.
In any event, before deciding to negotiate with a creditor or collector regarding your debt, or if you are thinking about just stopping paying certain debts, make sure you understand that some debts are uncollectible because they are too old. Secondly, be aware that a creditor might be able to garnish your wages, usually up to 25%, to recover the debt if you stop paying. Make sure you understand wage garnishments and out of statute debt before deciding what action you are going to take.
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