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Creditor lawsuits for unpaid debt

On Behalf of | Oct 18, 2021 | Uncategorized

Credit card debt is a big problem for a lot of people in Michigan. When you can’t keep up with your credit card bills, you could start defaulting on payments. This can set off a stressful chain of events that leads to a creditor lawsuit against you.

What happens when you don’t keep up with payments

If you miss one minimum payment on a debt, you may only have a fee show up on your next credit card bill. Keep missing payments, though, and your creditors will start contacting you by phone and mail.

When your creditors are unable to get in touch with you, they may send your account to collections. You’ll receive more calls and letters from the collection agency until the company decides to file a lawsuit against you.

What happens if you are sued for unpaid debt

A collection agency can petition the court to order you to pay the debt. Debt collectors may also get the court to place a lien on your bank account to recover the debt. There is no jail time for unpaid debt in the U.S. or penalties for filing for bankruptcy.

If you are sued for a debt, you will receive a letter about your court hearing in the mail. You will have the right to defend yourself against the lawsuit. There are cases in which collection agencies sue the wrong person for a debt or include false information in a lawsuit, so you should verify the details of any debt you are being sued for.

Other options

You may have better options available to you to get out of debt. If you are facing lawsuits for unpaid credit card bills, chances are your debt has become larger than you can reasonably afford to repay. You may want to speak with an attorney about negotiating a settlement or filing for bankruptcy.