If you are currently being sued by a creditor or debt collector, the subject of the lawsuit could be debt accrued during 2020, but more likely it was left over from ‘pre-COVID times,’ and just picked back up as moratoriums on debts collections lifted. Being sued is a problem, but even worse is a growing issue that has come to light in the past months: credit cards have been used as an alternative source of income for many consumers during difficult times, hiking balances up to their limits in many cases.
If this is the case with your finances currently, you may feel like there is no way out. And while the situation may seem dire, it is important to realize that even more than ever, you are not alone; in fact, millions are in terrible circumstances in terms of health or finances—or unfortunately, both. Along with that, so many have had to caretake for other family members as well as deal with the sadness of losing them or watching them suffer from terrible long-term side effects. That does not mean, however, that creditors and debt collection agencies are going to be patient forever.
If you are being sued, it is imperative to take care of the situation as soon as possible. You may feel like you literally have nothing left to lose, but no matter what your age is, it is critical to consider whether that will really be true 20 years from now. Surprisingly, that is how long a default judgment could follow you around in California since the initial judgment is good for ten years, and it can be extended for another ten if the debt is not satisfied. That’s an awfully long time to be worrying about wage garnishments (up to 25 percent of your disposable income), as well as losing your property for sale at public auction, and having control of your financial accounts taken from you.
Strangely, this is a better time than ever to negotiate terms. Remember, creditors and debt collectors have been under their own form of financial strain, and at this point, they may be willing to take pennies on the dollar. You may also find that they are willing to reorganize payment plans, and even refinancing may be easier. Seeing the process through and realizing that the debt has been satisfied may take some doing, but could be well worth it in the end to save further damage to your credit—and send you on a new path to financial freedom.
Speak with an attorney from Fitzgerald & Campbell, APLC as soon as possible to examine your options. Our attorneys have decades of experience in serving clients as they navigate through challenging financial situations, to include student loan issues, bankruptcy, and other debt management processes. We are here to help! Click here to schedule a free 30-minute consultation, call us at (844) 431-3851, or email us at firstname.lastname@example.org.