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Thread: need advice, being sued for credit owed

  1. #26
    Senior Member Neptune's Avatar
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    Default Re: need advice, being sued for credit owed

    Thank you so much for all the info and support given to me here. I am very, very grateful.

    Hide my computer? Oh no. My name is on the account for my ISP. Can they find this out and seize my pc?
    Do I need to change the name on the account right away?

    My BF also uses a cell phone 'in my name' that he pays for. It's in my name because he was helping me build up better credit from my first 'fuck up'. Should I tell him to change the name on the account?

    How do they attempt to seize items? Do they first send you paperwork issuing a set of questions to you about your assets and then send an officer to your house to come in and collect?

  2. #27
    Banned Melonie's Avatar
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    Default Re: need advice, being sued for credit owed

    Neptune, stop sweating the small stuff and do as Zofia recommends - even though it has been longer than 35 days since you received the notice, send in your response now which at least includes a signed statement that "I dispute the charges" .

    There is nothing sacred about the 35 day time limit. As Zofia said, as long as your statement "I dispute the charges" is received by the court before the collection attorney actually comes before the bench with his request for a default judgement against you, the judge CANNOT HAND DOWN A DEFAULT JUDGEMENT. This is very important for the following reason.

    If you don't send the court a statement which says that you dispute the charges, the judge can simply assume that everything the collection attorney is saying before the court is true (since you haven't disputed it), and then the court can hand down a default judgement against you without requiring further proof. However, if you DO send the court a statement, then the judge is forced to say to the collection attorney - PROVE IT (that you actually owe this money and have not responded to previous collection attempts). From the collection attorney's standpoint, this means it is now necesssary to research records in detail and prepare new court documents based on the info in those records. Sure, if the collection attorney does this you'll still wind up with a judgement against you - BUT ..

    #1 any judgement which winds up being granted down the road will be no worse than the default judgement that would be granted if you don't respond to the court (other than higher court costs perhaps).

    #2 it will take time for the collection attorney to prepare these new court documents, meaning that the judgement will be "postponed" for a while, or

    #3 the collection attorney will come to his senses and figure out that it's going to cost him more than the $1400 you owe to prepare these new documents and spend yet more time in court trying to win a disputed judgement against you. I'd wager that this collection attorney is in business to MAKE money, so there's virtually no way he'll decide to spend more of his own time and money in expenses than he can collect from you on this debt in return - i.e. he'll simply stop pursuing your case (without getting a judgement against you), and he'll move on to harass someone else who owes more money than you do and who actually has some assets which are worth more than the amount of their debt so that the collection attorney can turn a profit on his collection efforts.

    Write your answer on the first page of the court documents you received TODAY, make a photocopy for your own records, and then mail the original first page (which I assume shows your name, the name of the outfit suing you, and a case number or something like that) with your signed statement on it disputing the charge back to the court on Monday morning return receipt requested! Sending back your answer does NOT increase the likelihood that you'll have to appear in court ! If the collection attorney decides not to give up on your case, and does prepare the new documents and does go back into court seeking a disputed judgement, you can still decide not to appear and you'll be absolutely no worse off for it (see #1 and #2). My own feeling is that if you owed $14,000 the collection attorney would probably go the "extra mile" in seeking a disputed judgement, but for $1400 he's just going to cut his losses in terms of time and expenses and move on to harass someone else with better collection prospects.

  3. #28
    Senior Member Neptune's Avatar
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    Default Re: need advice, being sued for credit owed

    Thank you so much!
    with love, neptune

  4. #29
    God/dess Zofia's Avatar
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    Default Re: need advice, being sued for credit owed

    Neptune, what Melonie said is so right! Your ISP account is not an asset, it's a debt. The bank, if they seize your debts, will be worse off, not better. Same is true of your cell phone service. That's a debt, not an asset. The computer and cell phone are probably worthless. At best they are worth no more than what someone would pay for them at an auciton and that's not much. As a legal matter, every state has certain exemptions from execution that cover personal property. Make the collection of this debt expensive and time consuming and the bank will go away, or be willing to compromise. Also, your object is simply to delay until you can take bankruptcy.

  5. #30
    Senior Member Neptune's Avatar
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    Default Re: need advice, being sued for credit owed

    I filled out the answer sheet with my $15 filing charge check, return reciept.

    Thank you all so much for the 'exact' advice I really needed. Melonie, thank you for drawing out exactly what I need to do. I was freaking out because I didn't know how to handle it.

    I still have 3 other cards that are still in collections at this time with amounts that are equal to or less than the $1400 I'm defaulting on.

    What is the best route to go from here? If I were to add my total debt, all cards included, it would be somewhere in range $5000 or $6000 I owe out. All cards are in collections.

    Which options are the smartest? negotiate a lump sum to pay off each card individually, credit consolidation? I'm not sure going bankrupt again for 5 or 6k is worth it...or is it?

  6. #31
    Banned Melonie's Avatar
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    Default Re: need advice, being sued for credit owed

    Neptune, that's a difficult call. The first thing to consider is that the $5000 or $6000 that you think you owe may turn into $10,000 or $12,000 when late fees, penalties, interest etc. are tacked on. For the time being I would follow the same game plan of stall, stall, stall.

    Best case scenario is if you owe these other creditors less than $1400 each, they'll come to the same conclusion that hopefully this first collection attorney will - that when you don't "roll over" on their first try at a default judgement that they're better off simply dropping your case and moving on to another person who owes more money than you do and who also has some assets that they can glom onto which are worth more than the debt they owe.

    Absolute worst case scenario is that all of these collection outfits give in to their collective cases of dementia, they all decide to throw profit to the winds by expending the extra time and effort to seek disputed judgements against you after you respond "I dispute the charge" to all of their claims. A year or 2 from now these disputed judgement cases finally get before a judge, and the judge grants the creditor a disputed judgement against you in every single case. All of these creditors then head straight for your door with their judgements in hand like a pack of wolves. Then WHAM - you file bankruptcy again - and leave all of them whimpering with their collective tails between their legs as the bankruptcy filing turns their court granted judgements into so much toilet paper!

    Keep in mind that collections are a business. Creditors routinely sell off "bad debts" like yours to collection agencies for 30,40,50 cents on the dollar knowing that it's virtually impossible to collect the full value of the debt in many cases. The collection agent then attempts to get the debtor to pay off 50,65,75 cents on the dollar with no effort and pockets the difference over the 30,40,50 cents on the dollar he spent to buy your debt. Or the collection agent is willing to invest some (I repeat, some) effort in an attempt to collect 100% via a court judgement and still can pocket a profit providing that his collection expenses do not exceed 50% of the debt.

    However, if you make it difficult enough that the cost to the collection agent to prepare documents and spend time in court seeking a judgement exceeds 50% of the value of your debt (which in your case is $700 or less - maybe three hours of an attorney's time plus six hours of a clerk's time) then they're better off financially simply dropping your case and moving on rather than investing more time and money than they can possibly collect from you in return. I'll wager that this is exactly what the other collection agents are going to do once you dispute their first attempt at a default judgement.

  7. #32
    Senior Member Neptune's Avatar
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    Default Re: need advice, being sued for credit owed

    I DID in fact get a judgment against me. So I lie in default now.

    I'm STILL not working, however when I do begin working and making some cash at a regular neighborhood club which probably won't be reporting me, could I open a small checking account and just keep about $200 in there for online purchasing?

    Will anyone try to garnish a few hundred dollars in my account?

  8. #33
    Banned Melonie's Avatar
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    Default Re: need advice, being sued for credit owed

    Will anyone try to garnish a few hundred dollars in my account?
    They won't try to garnish your bank account - more likely they'll try and sieze the entire balance. Employee paycheck garnishment is limited by state laws to a certain percentage of your earnings, but bank accounts and most other "assets" have no such protection. Since the credit card company already has a judgement against you in hand, they could theoretically 'clean out' your bank account with one fax to your bank.

    This could make your financial problems worse if for example you make $200 worth of online purchases based on a $200 deposit you just made. However by the time the funds transfer request from the online business actually hits your bank, if the credit card company has cleaned out your balance the day before, your "check will bounce". This can put you in trouble with both the online business you made the purchase from, as well as in trouble with your bank, and can potentially lead to criminal charges.

    You're better off getting a "secured" credit card for online purchases if you can. However, since you 'boned' a credit card company who has now been granted a judgement against you, you probably won't get approved by any credit card company.

    Also, if I'm reading between your lines correctly that you plan on being less than 100% accurate in your income reporting once you start dancing again, having every transaction of your bank checking account automatically available to the credit card company you defaulted on is very likely to draw attention immediately. They're going to see deposits coming in and purchases going out, and if none of this money is going in the credit card company's direction to pay down your defaulted balance they are rather likely to bring this fact to the attention of the court that issued the judgement against you as well as the IRS.

    Not that I'm making any recommendation (for the record, every dancer should be reporting her income and paying her taxes), however ... if you have it in mind to "fly below the radar" in regard to your dancing income, you'll also need to "fly below the radar" in regard to your expenditures. This means no checking accounts, no credit cards, nothing which will create a record of the money you are spending which can potentially be compared to the money you are (not) reporting as income. This leaves two alternatives - pay in cash or pay by money order.

  9. #34
    God/dess Zofia's Avatar
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    Default Re: need advice, being sued for credit owed

    I DID in fact get a judgment against me. So I lie in default now.

    I'm STILL not working, however when I do begin working and making some cash at a regular neighborhood club which probably won't be reporting me, could I open a small checking account and just keep about $200 in there for online purchasing?

    Will anyone try to garnish a few hundred dollars in my account?
    If they garnish a bank account, every penny that comes into it, will have to go to the judgment creditor. This even applies to Social Security Disability, or Social Security Retirement benefits, payments from a 401K or Pension Plan and even payroll. Generally all these things are exempt from execution, but once they enter your checking account they lose their protection.

    Your only real choice for a credit card now is a prepaid one.

    However, there still is some good news, all debts are negotiable. The collection agency paid fifty cents on the dollar or less to Capitol One. They make a profit on anything they get over that percentage, plus court costs and whatever they had to pay their attorney. Go negotiate.

  10. #35
    Veteran Member soybeangirl's Avatar
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    Default Re: need advice, being sued for credit owed

    They can and will file for garnishments on your wages. It's all very very messy. You should check the phone book and find a bankruptcy atty who offers free consultations. See what they tell you. Good luck.

  11. #36
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    Default Re: need advice, being sued for credit owed

    neptune, the letter from capital one was not a suit. its a common collection tactic used by creditors. they will make it look like you are in big legal trouble, but thay cannot force you to pay. after awhile, your debt (lets say its $500) will be sold to a collection company for $250. Capital one writes off your debt and is done with it. The new collector will still try to get you to pay the $500 you owe, and pocket the rest as profit. If they are unsuccessful, they will sell the account to another collector for, say $100, and so on. Some collection accounts are bought and sold for $20! Any amount they collect from you is basically profit. I would tell capital one to f*ck off if you really cant pay. deal with your bad credit, as it is already ruined. The only other way is to do another bankruptcy.

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