My Credit Check shows an unpaid balance for $2734.68! How much money do I need to owe a credit card company before they sue me or something dreadful?
If I had a penny for every time I get this question, I’d be lounging poolside sipping fruity drinks at some beach-front “ritzy” resort. Get the point?
If your credit card issuers (Creditors) don’t get paid, they’ll push your delinquent account to inside collections.
Inside collections fails to squeeze money out of you, so they hand it off to outside collections.
If debt collectors can’t collect, they’ll sell to “junk debt buyers” (or JDBs) who will squeeze a little harder knowing they bought your unpaid debt for literally pennies. The profit potential is incredible, filling these JDBs with greed beyond your imagination….debt collectors on steroids!
When trying to predict whether you’ll get sued, one question you must ask when trying to predict whether you’ll get sued is, “How easy of a target am I?”
- Do you own your own home?
- Do you have full-time job?
- Do you have cash in the bank?
- Do you send letters to debt collectors, flaunting your unpaid debt? More importantly, do you….
KEEP DEBT COLLECTORS AWAY
Debt collectors usually don’t mess with debts under $500. It’s not uncommon for a “local” collection agency to go to court with a dozen lawsuits at a time, and the court puts them all on the same docket. One right after the other, the judge rules in favor of the Plaintiff (credit card issuer) since the Defendant failed to show up (default judgment).
If you’re sued, at least respond to the Summons and show up. You automatically LOSE by not responding or showing up.
Now, If your unpaid debt is over $2000, you’re viewed differently, since the debt collector sees profit potential.
Their Intent Is To Scare You, Not (Necessarily) To Sue You!
Many people mistakenly believe they’ve been sued, when in fact they’re probably being sent an “INTENT” to sue letter. Big difference.
Your credit card companies typically will send you letters saying they will write off the debt, garnish your wages, and possibly sue you. Whether or not they’ll sue considers what you own (assets), what it will cost & whether or not you’re a pushover.
By contacting you with an “intent” letter, they are letting you know you need to contact them with acceptable arrangements to avoid it being referred to their attorney.
The amounts are not small amounts, it is worth their while to sue you–even with paying attorney fees. If they have sent this letter, they have determined that you:
- Have assets
- Have a decent job
- Have a bank account;
- Have a mortgage.
If it goes to court and “THEY” get the judgment, you are looking at possible garnishment of wages, garnishment of bank account or a lien put on your home–all depending on the state in which you live.
In Florida, for instance, if you own your own home your “homestead exemption” should protect you from judgment creditors. It’s difficult (and beyond most people’s understanding) to touch a person’s home unless you (for instance) are not paying your house payment.
**Disclaimer: I am not an attorney and don’t pretend to be. Please consult appropriate legal counsel in your area for proper legal advice.
TIP: Do not avoid your creditor’s or debt collector’s letters. Contact the credit companies and try to make arrangements with them if you are getting hassled.
Let them know your financial situation–most companies will work with you. Not because they’re nice but because they know the worst case scenario has you making payments as it is.
Are you ready to receive lots of automated phone calls and letters?
Yep, this ‘s assembly-line debt collection, down to the debt collector’s automated dialing. Debt collectors get paid well for chasing you get (on average) 30% of whatever they collect. If you owe about $500, they can get back about $150. And if you live in a different state where they don’t have an office, they have to hire an outside agency to continue the collection…more money out of their pocket.
If your local court offers you Internet access to court records, do a quick search to see how many lawsuits they file in your court and develop your PLAN.
And when you do a “my credit check,” you will confirm a bad credit account:
- Reported 100% accurately,
- Within Statute of Limitations,
- Free of any violations.
Last, have you ever heard of a “friendly judgment” strategically filed against YOU by YOU? I don’t want to get in to this now, but inside our members-only area we’re discussing a powerful “secret” for protecting yourself from judgment creditors without filing bankruptcy.
Pretty interesting…..
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