Can a Creditor Sue Me For Unsecured Debt?
By John Hurley
Can a creditor sue me for unsecured debt? Unfortunately, the answer is yes. Just because a loan is not secured for real property, creditors are still able to go to court to collect the money you owe them.
The process is that they will serve you with a Complaint. You will have a certain amount of time to respond to this Complaint on official papers. If you do not respond, the creditor will pursue a Default Judgment and you will not have the opportunity to "have your day in court."
If you do respond, then the creditor will have to take their case to a Judge or Jury and prove that you owe the amount. If they win, you will have a Judgment against you. Ironically, part of the total Judgment amount will include all of the legal expenses incurred when preparing the case against you.
The creditor can then act on this Judgment by garnishing your wages (in some states, they can take up to 50 percent.) They can also act on their Judgment by seizing your property. Your bank accounts, cars, and even your home are not safe once a Judgment has been issued against you.
If you are served with papers, you have several options.
One is to contact the company and try to negotiate a settlement. Often, the creditor will offer to reduce the amount owed by half to get rid of the case and the obligation.
Another thing you can do is fight. If you go this route, don't try to do it alone. Retain the services of an attorney or you are sure to lose.
If you fear that you might get to the place where an unsecured creditor might sue you, consider seeing a debt consolidation specialist to ward off the situation. In this sense, you can take care of your debts all at once and pay one low monthly fee that covers all of your obligations.
So, the answer is yes to "can an creditor sue me for unsecured debt?"
If you have fallen into the trap of easy credit, and found yourself over your head in debt, there is help! Go to http://www.helpfordebt.org to reach out to organizations that can assist you in reducing your debt - sometimes up to 50%. You will learn to make - and stick to - a budget and they will help to negotiate your credit card and other bills down.
You are not alone. Many other people who were in exactly the same circumstances as you are have found relief through the programs offered through http://www.helpfordebt.org
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