If you are facing a debt lawsuit, you may want to seek the help of a debt defense attorney. Why? Well, maybe you don’t feel like you owe the money. You feel that the amount is in dispute. Perhaps the other party failed to fulfill their obligations to you. You believe the creditor used illegal harassment tactics to try to intimidate you into paying. There are many laws that protect consumers from dishonest creditors and unethical contract collection companies.
Even if you owe the creditor money, often when an attorney gets involved, they can negotiate a more favorable settlement agreement, since the creditor now faces getting nothing if they sue you. In fact, if the creditor loses the case, he also loses the fees he paid to his attorney.
When does it not make sense to hire a lawyer?
How to defend yourself against a claim from a creditor?
If you have no money in the bank and no assets, the creditor may get a judgment, but will never be able to collect on you. If you find yourself in this situation, you are basically “judgment proof” and it would not make sense to hire an attorney to defend you and protect your money or property from him. If you don’t show up in court, your creditor could get a default judgment, but they won’t have a way to collect the debt.
If the debt you are being sued for is relatively small, the attorney’s fees to defend the lawsuit may be more than the actual amount owed. It may be easier and less expensive to simply pay the creditor.
If your creditor is taking you to small claims court and you have proof that you do not owe the creditor money, you may determine that it is best to represent yourself. If you are unsure about this, it may be time to discuss the case with a debt defense attorney. Again, consider the amount in dispute and the cost of the attorneys’ fees. Many debt defense attorneys will give you 30 minutes to discuss your case free of charge. Generally, a 5-10 minute phone call is enough to make that decision.
If you know you legitimately owe the debt, you might try to work out a deal with the creditor to save time and money. If a creditor gets a judgment against you, he could end up paying much more, since the judge could award him attorney and court fees.
Counterclaims against your creditor
You may have a legitimate counterclaim against the creditor. If you do, once you involve your attorney, the creditor’s attorney may be able to advise you to settle and avoid costly litigation. In fact, if you think you don’t owe the money because they didn’t honor their agreement or deliver the promised services, you may be able to countersue for damages. If you have a dispute like this and are being threatened with a lawsuit from a creditor, it will definitely benefit you to get a good debt defense attorney. If the amount of money is enough to justify the attorney’s fees to defend you, then it is a good idea to contact a debt attorney as soon as possible.
What happens if you do nothing and your creditor gets a default judgment against you?
Many people who owe money avoid their creditors and their creditors go to court and get default judgments. The problem here is that the creditor will usually add attorney fees, interest, and court costs. The amount owed can skyrocket. As soon as the court makes that judgment, interest will begin to accrue until the money is paid in full. Your creditor will be able to garnish wages, put liens on real property, and find ways to legally collect the debt.
What if I have bills I owe but can’t pay and am about to be sued by many creditors?
If this is the case, it would be wise to talk to a bankruptcy attorney who can explain how bankruptcy works. If you are concerned about defending multiple creditor lawsuits, especially unsecured debts like credit card debt, you should speak with a bankruptcy attorney. You may find yourself with more than you can handle. An experienced bankruptcy attorney can present you with all of your options. In the long run, it may be in your best interest to discharge all of this debt by filing for Chapter 13 or Chapter 7 bankruptcy.
Despite the negative connotations that the word ‘bankruptcy’ carries, in many cases it is the best option. Solve all your problems at once. It can help you get back on solid financial footing faster than letting debt overwhelm you and completely destroy your credit. Of course, this is all general information. You see, everyone’s financial situation is different. This is why it pays to talk to a debt defense attorney or bankruptcy attorney before you start racking up default judgments against yourself for unpaid debts.
