If a debtor does not make his payments, a creditor can seek payment of the debt by a legal proceeding whereby a judgment is granted. If you have ever taken out a loan or applied for a credit card, hopefully you have read the fine print of the documentation. One of the things that fine print says is that you agree to be sued in the event you do not make your payments.
The main goal in a creditor's law suit is to prove that you actually owe the debt. It is smart, if you really do owe the debt, to attempt to resolve any pending legal action quickly. It is often that a creditor may prefer a settlement to continuing with a legal action. To show good faith, it is helpful if you can provide an up-front partial cash payment.
It is important to ascertain if the statute of limitations has already run. If so, the debt is uncollectible. You should note though that your legal obligation to pay the debt can be reinstated if you make even a small payment.
If an attorney is handling the matter for the creditor, call the attorney and make an offer. No matter how modest your offer may be, the attorney is ethically bound to discuss the offer with the creditor.
For many reasons, going to court should be avoided. In all instances, a settlement is better than ending up with a judgment. If a judgment is obtained by your creditor, it will then be shown on your credit report. A judgment can remain on your credit report for up to ten years.
SHOW UP if you are forced to go to court! Many people who cannot reach a settlement with their creditor make the error of not attending the hearing. This, in turn, means that the creditor will be granted the judgment by default!
It is important to note that if you do appear, you should be prepared to present a defense and work toward a resolution of the matter. You will earn the respect of the judge and plaintiff creditor by doing so. This will require that you present a defense on your behalf.
The creditor's goal is to obtain a judgment against you. If he is successful, you will receive a court judgment which will give you 30 days to pay the debt. If, after 30 days, the debt is still unpaid, the creditor may have additional legal remedies open to him. One of these remedies may be to place a lien against your house or other property. If a lien is attached to your home, the debt will have to be paid in full before you can refinance or sell your home.
The garnishment of wages is another legal remedy which is allowed in some states. Additionally, sometimes creditors are allowed to seize personal property to collect the debt.
The result of a judgment on your credit score will be far-reaching. Besides a loss of borrowing power, other areas of your life can be adversely affected. For instance, your chances of promotion or a new job opportunity may not materialize! It is wise to avoid a judgment at all costs. - 29866
The main goal in a creditor's law suit is to prove that you actually owe the debt. It is smart, if you really do owe the debt, to attempt to resolve any pending legal action quickly. It is often that a creditor may prefer a settlement to continuing with a legal action. To show good faith, it is helpful if you can provide an up-front partial cash payment.
It is important to ascertain if the statute of limitations has already run. If so, the debt is uncollectible. You should note though that your legal obligation to pay the debt can be reinstated if you make even a small payment.
If an attorney is handling the matter for the creditor, call the attorney and make an offer. No matter how modest your offer may be, the attorney is ethically bound to discuss the offer with the creditor.
For many reasons, going to court should be avoided. In all instances, a settlement is better than ending up with a judgment. If a judgment is obtained by your creditor, it will then be shown on your credit report. A judgment can remain on your credit report for up to ten years.
SHOW UP if you are forced to go to court! Many people who cannot reach a settlement with their creditor make the error of not attending the hearing. This, in turn, means that the creditor will be granted the judgment by default!
It is important to note that if you do appear, you should be prepared to present a defense and work toward a resolution of the matter. You will earn the respect of the judge and plaintiff creditor by doing so. This will require that you present a defense on your behalf.
The creditor's goal is to obtain a judgment against you. If he is successful, you will receive a court judgment which will give you 30 days to pay the debt. If, after 30 days, the debt is still unpaid, the creditor may have additional legal remedies open to him. One of these remedies may be to place a lien against your house or other property. If a lien is attached to your home, the debt will have to be paid in full before you can refinance or sell your home.
The garnishment of wages is another legal remedy which is allowed in some states. Additionally, sometimes creditors are allowed to seize personal property to collect the debt.
The result of a judgment on your credit score will be far-reaching. Besides a loss of borrowing power, other areas of your life can be adversely affected. For instance, your chances of promotion or a new job opportunity may not materialize! It is wise to avoid a judgment at all costs. - 29866
About the Author:
Lexington Law Fixed this Lady's Bad Credit and Raised Her Score by 163 Points. See Why it Works at www.lexingtonlawreviews.com.
