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LostLady's avatar

I'm being sued by a collection agency. What should I do?

Asked by LostLady (14points) November 30th, 2012

I came home one day to find a court summons stuck in my door, left by the state marshall. I’m being sued by a collection agency. My Chase credit card informed me that they were writing me off and I thought I wouldn’t have to worry about my debt but then it got bought by Midland Funding. Now they are taking me to court and I am terrified! I’ve been out of work for three and a half years and cannot afford to pay. I no longer have an IRA or savings account. I am seriously broke and cannot afford a lawyer. The debt is just over $6000. I am a property owner with my other siblings and am scared to death they could take my property away. I don’t even want anyone in my family to know about this. Help!!!! What should I do? I’ve tried to read the court summons several times and don’t even understand it completely. Is it possible to find a lawyer/public defender for free to help me? I live in CT. Any and all advice welcome! I feel like I’m about to have a nervous breakdown. This is so overwhelming. I was with Care One for a year and a half after I lost my job and things were fine till my unemployment ran out, then my savings…. I know I’ve stuck my head in the sand when it came to dealing with this matter but now I have no choice. I’ve never been to court and don’t know what to expect. Please help me…anyone who has been through this or knows what I need to do!!!

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22 Answers

JLeslie's avatar

I’m not very familiar with the laws. Is there any way you can agree to pay a small amount monthly to keep them off your back? Even $10?

Probably filing brancruptcy might help, but I don’t know exactly what you need to do and how to qualify for it.

Try the link @Tropical_Willie gave you. Hopefully they can get you to the right person who can answer questions and give you some practical help.

Some states the “homestead” is always protected and cannot be taken away because of other debts, I don’t know if CT is one of them.

Another option maybe call the courthouse and someone there can tell you if there are public defenders who can help you?

Do you have other bills outstanding? If you do, I think you are going to have to get a real action plan on how to handle the financial troubles you are having. Being proactive will help you be in better control rather than just waiting to see if collectors are going to come after you. Can you go to a relative for help?

Tropical_Willie's avatar

If you have a court summons I believe it too late to set-up a payment plan with Midland Funding. Contact the toll free number on the website Iink. There should have been a letter from Midland before the court summons.
Did you ignore a letter from Midland thinking ir was “junk mail” ? ?

I’ll say it again contact SLS in Connecticut right now, Midland is a nasty and predatory collection agency. You will need to have a lawyer ( free I hope ).

I’m not a lawyer.

Judi's avatar

Appear in court! If you don’t, they will win by default. If you go to court, explain your situation and tell them that you don’t even have the money to file bankruptcy, the judge might take piety on you reduce the debt and negotiate something like 5 dollars a month. Your other alternative is bankruptcy which was designed for people in your exact situation. It is not a shameful thing to be a victim of a failed economy.
The thing I am most concerned about is your self esteem. I know what it is like to be where you are. Breathe. your circumstances don’t determine your value.
Also, if teh real estate you own is a primary residence, I don’t believe they can take it, although they might be able to put a lein on it and take the money once it is sold. Do they know that you own it? They probably don’t and you shouldn’t tell them.
(I’m not an attorney either.)

trailsillustrated's avatar

Go to the court hearing. Often, the collection agency reps don’t show up and the case if thrown out. Or, gather 600$ from someone, anyone, call them up, and offer it to settle. If they do (and they often will settle for pennies on the dollar) get it in writing. Just so you know, if this debt is forgiven for the full $6000 you will get a 1099 from the irs and it will be added income.

JLeslie's avatar

For sure show up at the court date, I thought that was a given.

Dutchess_III's avatar

I would tell the siblings that I co-ow property with to give them a chance to buy my share. They’re going to find out anyway.
Other than that, do what the Jellies above say.

KNOWITALL's avatar

Been there done that, with tons of medical bills. Don’t panic.

Basically they are telling you that you have to pay, one way or another. They can attach a lien to the property you co-own, which means if it’s sold, you have to pay the judgement (more than likely out of your own portion) and when it’s sold it will show up on the title search and the new buyers will see it, along with your family.

What I would do, and have done, is to call the company suing you and make payment arrangements before it becomes a lien or judgement. I understand a lot of us are having really tough times right now but we still have to pay what we owe, even if $50 a month.

Or you can sell something to make a big payment as a good faith payment, then they’ll almost always accept payment arrangements.

BTW- this will affect your credit and will also show up in your state’s legal website as a judgement that anyone will be able to see.

FYI- I am down to $1000 on a $6800 medical bill I’ve paid off $100 a month for the last 5 years. I am extremely proud of myself, my husband, and the sacrifices we’ve made to get this done w/o a judgement being filed. Yeah me!

tedd's avatar

DO NOT pay them anything until you have fully explored your options.

If the debt is expired they will try to coerce you into paying, the second you give them penny number one the debt is no longer expired.

Go to the court hearing, it sounds like they’re just trying to bully you if this is the first you’ve heard of it.

Honestly I may even contact the court (find their contact info from your internet in case it’s lied about on the mailing), and make sure its even scheduled for a court hearing at all. I’ve heard of some shady things happening from collections agencies.

KNOWITALL's avatar

Um, with all due respect, if the money is owed then it should be paid. That’s why America is in this financial mess because of so many people making excuses for non-payment or filing bankruptcy.

I’m not rich and my husband has tons of medical bills, my car is dead and I just spent $200 I didn’t have at the vets this week. I have no meat in my refrigerator to eat. Sacrifice and do the right thing.

LostLady's avatar

If I can arrange some kind of payment plan with them before my court date, will it stop this from going to court??

KNOWITALL's avatar

Yes it will. That was my first question as well.

LostLady's avatar

My problem is right now I have absolutely no income. I was doing so great with Care One but when my unemployment ran out I drained my savings and could no longer make payments :( I understand where you’re coming from, I KNOW I owe and do not want to resort to bankruptcy but I need more time to find a job and get back on my feet.) I never understood why people would end their lives over financial problems but now that I’m in this boat, I understand completely! It’s overwhelming and depressing. I have so much anxiety it’s making me feel immobilzed. (Which I know is the WORST thing to do, because sticking my head in the sand and ignoring this issue is what led me to this road in the first place.)

CWOTUS's avatar

Welcome to Fluther.

Assuming the facts are as you have stated, then you are bankrupt. And though I agree with @KNOWITALL that debts should be repaid, the fact is that at present you simply cannot repay this debt. So you should explore the potential relief – if only to your psyche – of going that route, formally – and legally – declaring bankruptcy and relieving yourself of the debt so that you can start over.

For now, though, be sure to show up at the court hearing. Not doing so would automatically lose the suit being brought against you, but may result in a bench warrant besides. So then you’d have another problem to dodge. When you go to the hearing bring documentation to prove your financial status, including bank statements (closing statements showing zero balances), IRA statements and other former stores of funds which have been exhausted, and also bring employment records (with termination notices, if you have those) that show employment history and loss of employment.

Face the fact of your status as a bankrupt, and let your close family and co-owners know. Resolve not to become a deadbeat, and consider what you will have to do to get back on a sustainable and sound financial footing.

If you can work out a payment plan with the collection agency, assuming you can generate some income to do that, then that would be admirable and worthy. But if you can’t do it, then it’s about time to acknowledge (and lightly publicize) the fact so that you can start to resolve the situation. Facts don’t go away because we choose to ignore them.

KNOWITALL's avatar

If you have no income whatsoever, I would go before the judge and explain. I’m not sure it will do you any good, but it’s worth a shot if your situation is as dire as you explain. They may defer payments a few months as well. If nothing else, take the judgement and embarassment with the family members. I’m sorry about your situation, I really feel for all of us in financial situations right now, that see no way out.

Just remember, this too shall pass, and the entire country is having the same problems.

Judi's avatar

Just another note, even if you work something out with the creditor, STILL SHOW UP AT COURT. No matter what they try to tell you, they will show up and will get a judgement by default. They will tell you anything to convince you not to show up.

KNOWITALL's avatar

My court date was cancelled, I called the court and the atty handling the ‘suit’, after I made payment arrangements.

woodcutter's avatar

You can’t get blood out of a stone. You are broke and they aren’t going to get shit. You are not the first person they have found in your situation. You will end up paying income tax on that money…watch. You will have earned 6000 dollars in a year. That is way below poverty level so you might not.

Judi's avatar

It will be considered “unearned” income and I’m sure there will be no tax due. (If the collection agency writes it off.)

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