When an unpaid credit card debt turns into a lawsuit

Have your credit card debts become so large that you can’t even afford the minimum payments?  Or perhaps you’re already behind and your accounts have been turned over to collections? What do you do to get out of this financial mess?

If you are in this situation, maybe you’ve wondered about what the legal repercussions might be once you get to the point where you can no longer continue paying your creditors. Can credit card companies sue you for what you owe? And when they do, what happens when they get a judgment against you?  These are the questions I’m often asked by people who seek legal advice regarding their debts.

Of course, credit card companies don’t make it easy for you to catch up once you fall behind.   They are quick to add on additional fees and demand that you bring your account up to date immediately by paying the current amount due, all past due payments as well as late fees. And if allowed by the agreement that you signed when you first applied for the credit card, your interest rate can also go sky-high upon default.  Before you know it, your debt problems have become a financial nightmare and your phone starts ringing off the hook with bill collectors harassing you at home and at work. What do you do at this point?

If your credit card debts have escalated beyond your control, perhaps you are getting nervous about what your creditors will do next. Can you be sued? Yes, you can be sued once your creditors are convinced that they have exhausted all other options to force you to pay. Of course, the benefit to be gained by suing you must outweigh the costs so the creditor will take that into consideration as well.  But most delinquent accounts are turned over to collection agencies in high volumes which significantly reduce the creditors’ litigation costs. Smaller companies like credit unions will also sometimes sue you in small claims court and they don’t even need an attorney to file the lawsuit.
I often see people who ignore their debts for a long time until one day they receive a summons at home or at work and only then do they realize the seriousness and urgency of their situation.  If you are sued by a creditor, it is very important that you do not ignore the lawsuit or you will definitely regret the consequences once the creditor takes the next step of garnishing your wages, seizing funds out of your bank account, filing a lien against your real property or a combination of the above.

If filing bankruptcy is your best and only option, it is best to seek legal help right away before your debt problems get worse. Spare yourself the suffering and the agony caused by debt if at all possible. In choosing a bankruptcy lawyer, remember that not all bankruptcy lawyers are created equal and may have different ideas on how to help you. It is important to choose a knowledgeable and experienced attorney who has your best interests at heart.  Most debt problems are solvable but often they get worse if ignored. Don’t make this fatal mistake.   If bankruptcy is not your best option, sometimes debt settlement can also be a way to avoid bankruptcy as long as you can come up with a realistic payment plan that your creditors will accept.

If you are in debt and have not figured out a way to get out, constant worrying will not get you anywhere unless you act to change your situation for the better. For a free consultation, call my office at Toll-Free 1-866-477-7772 and we will help you step by step in finding a solution that’s right for you.

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None of the information herein is intended to give legal advice for any specific situation.  Atty. Ray Bulaon has successfully helped thousands of clients in getting out of debt. For a free attorney evaluation of your situation, please call  Ray Bulaon Law Offices at  TOLL FREE 1 (866) 477-7772.  

10 Comments
  1. Good pm,pwede po bang humingi ng tulong?hirap na hirap na po ako,dumating po ako sa punto na nabaon sa utang at hindi ko na po makayang bayaran ang mga credit cards ko,minsan po iniisip ko na magpakamatay na lang para matapos na po mga bangungot sa buhay ko,sobrang torture po yung mga colectors,pipilitin ka magbayad at pag hindi padadalan ka ng subpoena,legal action,summon,may time pa na pati boss ko tinawagan ng colection agency kaya po nagkaroon ako ng problem sa work ko dahil dun.willing naman po akong magbayad,pero sa ngayon po talaga kahit na i harass nila ako everyday wala pa po talaga ako maibayad.sana po matulungan nyo ko mapagaan man lang ang divdib ko.salamat po.

  2. same situation here ruby, I guess the best option here is to talk to them instead of hiding from these shits. ako nga binabantaan na ko na kakasuhan ng criminal case RA 4848 at sinabihan pa ko na stop hiding. i told them na Im not hiding, I just really couldn’t pay my debts in their terms. I only have so much. if they continue harrassing you maybe you can talk to bsp and pao for more legal advice

  3. Hi po pa help nman po last February 28, 2019 I received a letter from collection agency informing that my credit card account was referred to them for appropriate action due to delinquent account.

    This was happen due to unexpected financial problem. Tinawagan ko muna yung credit card company para malaman kung ano pwede ko gawin then ni refer nila ko sa collection agency na may hawak sa account ko. Diniscuss ko sa collection agent kung ano yung ngyari kung bakit umabot sa ganitong sitwasyun. Then diniscuss nya sakin kung ano pwede gawin need ko daw mag down ng 20k within this month then 5k na monthly.Masyado tlga mataas yung down na hinihingi naya pati yung monthly sa current situation ko hndi ko tlga mapoprovide. Nakiusap uli ako sabi ko kung pwede pa ba yun mababaan sabi nya hindi na daw, sabi nya manghiram na lang daw muna ako sa mga kaibigan ko ng pera or kung may post dated check sila para daw ma settle ko yung bill. Gusto ko rin naman masettle ito para wala na ko iisipin kaya lang hindi ko alam kung saan ako kukuha ng ganung pera. Sa ngayon hindi ko alam kung ano gagawin ko, sana may makapag advise sakin kung ano pwede ko gawin. Sana po ay matulungan nyo ko.

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  4. Hi ask ko lang about sa sister ko na lumaki na utang dahil sa interest ng credit card,we dont know where is her wereabouts,kaso may mga property sya na magulang ko nagamit pano po un pag ndemanda na ate ko pde kaya nila makuha property?pde kaya na ang magulang nya na lang magapply ng amnesty at sila na magbyad kung maaproved?

  5. Hi ask for legal advise lang po

    Same scenarios sa previous na andito i used to have 4 credit cards which I due can maintain naman yung balances before, unfortunately lang nagkaroon ako ng financial problems which nagkaroon ako ng motorcycle accident that caused be a lot of money and debts. hanggang dumating sa point na nabaon ako sa utang then nawlaan ako ng work for 3 months and one of the main reason kaya di ko mabayaran yung cards ko, Kaso ngayon nagkaroon na ko ng work kaso ayaw nila ko bigyan ng enough time na makabawi lang hindi pa ko sumasahod sa new work gusto na nila ipa settle yung depts ko

  6. Hi po, ask ko lang po if pwede pa ba ulit maningil ang collecting agency after more than 10years na ng credit card debt ko? Pag ganyan na po katagal applied na po ba sa mga credit card debt ko un tnatawag na STATUTE BARRED? Pupwede pa ho ba nla ulit ako kulitin magbayad?

  7. Hi po, asking for help also and what better way to do. May multiple cards po ako and before nababayaran ko Naman Yung monthly. Pero na out of control po ako dahil Yung mga pinambabayad ko ng monthly eh inutang ko din sa mga cards hanggang magrambol na sila. May mga personal loan din ako na nakatulong pambayad pero ganun din umikot Lang Yung mga utang ko hanggang di na ako maapproved for loans. At nito ngang December January, nag skip nako sa mga credit cards, Sabi mg mga kaibigan ko unahin muna Yung mga tseke, pero Panay na Rin pong tawag mg areecive ko, sobrang nakakastress talaga, di Naman Tayo criminal nabaon lan talaga sa mga making paghandle ng mga kautangan, hingi po Sana nga advise, nataninh salamat po

  8. I thought Im the only one having issues with credit cards. Hindi na din ako makabayad dahil pati yung minimum payments tumaas na rin. Dumating sa point na need ko kasing i-stop ang payments for minimum one gawa ng emergency matters. Nagkaroon kasi ng instance na need ko munang istop yung payment gawa ng issues on family. Pero lumaki na siya ng lumaki and parang out of control na. Im having anxiety and depression na in terms of this. Ayoko naman idisregard but, right now, I dont know what option i could do sa sobrang mentally stress na ako. Please help me how i should free up my mind on this.

  9. Hello po.may dumating napo sa haus nmin for property evaluation.mr ko ang sadya nila.since di daw kmi kasal,di daw nila pwede idisclose sa akin but hiningi nila co number ko.babalik daw sila on monday(today is sat) , ksma ang brgy for property assesment daw.may binabanggit sila about small claims,civil case and worst daw is criminal case.actually, ninerbyos mga anak ko sa the way silang magsalita and nagtingunan mga kapitbahay nmin kc row house kmi nkatira.pumunta daw sila dito hindi para maningil.ano pong magandang gawin?legal po ba yung kasama nila brgy para sa property assesment na yun?pls, advise po asap..tnx po.

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