can't do ch.7 involved in personal injury lawsuit

What is the name of your state? Arizona.

I have been disabled since 2001. I recently got back to work in a reduced capacity. (i.e. not making as much money). I owe about 9,000 in credit card debt. I cannot afford to make payments on them since I am paying about $1000 per month for my medical care, which employer insurance will not cover for one year, because it is pre-existing. I know that $9000 is not alot, but I can't make the minimum payments the credit card collection agencies demand.

I can't declare bankruptcy because a bankruptcy attorney tells me that the bankruptcy trustee would be in control of settling my personal injury lawsuit (the cause of my disability). My mother was injured with me, and she had to declare bankruptcy, and the bankruptcy trustee settled her personal injury lawsuit for the amount of her debts, not caring that she needed compensation for ongoing medical care. I will not declare bankruptcy, because I will not give the control of settling my lawsuit over to a trustee when I have severe, life-long financial needs.

My largest collection is with United Collection Bureau, for about $6500. They won't take payments that I can afford.

Do you think they will garnish me for this? Any apprx average time frame they take to do this? I can't declare bankruptcy, and if I'm garnished I won't be able to afford my medications. Do creditors ever take liens on personal injury lawsuits and stop collection activity like garnishment?

I appreciate any information. Thank you.

[Ladynred]

First no one can garnish anything without first winning a judgment against you. If you have not yet been sued, then you needn't worry, yet, about garnishment.

IF it comes to that, you may have ample reasons to appeal a garnishment and keep that from happening since it would cause you hardship. No creditor can force you to do without needed medications just to pay them !

Ladyinred,

Thank you for the information. Have you ever heard of a collection agency taking a lien on a debtor's personal injury lawsuit and ceasing collection activity? I would be willing to do that. A collection guy from one of the collection agencies kept asking me tonight, "are you disabled because of an accident?" So I thought he might have been fishing for that sort of information.

[bigun]

Lisa,

Speak with your lawyer about using the anticipated settlement as collateral for a loan to pay these collections. If he/she has any experience in personal injury law, they'll know of lenders that'll make these types of loans.

I know about the type of loan you are talking about. I was awarded $750,000 for my injuries after two years of litigation. Now, the insurance carrier that should have to pay this is claiming that the policy excludes my sort of injury. Because the insurance coverage is in dispute I do not qualify for those sorts of loans against the settlement. The judge ordered the insurance company to pay me, but they are appealing, so I am looking at about two more years of poverty and dealing with my creditors. Any ideas on how to deal with the creditors? The last one I spoke with this evening said "Good Lord, declare bankruptcy lady". I didn't tell him that I won't, because I won't give control of settling my lawsuit to a bankruptcy trustee.

[bigun]

When did you last pay the orginal creditor?THe SOL in Az for a credit card is only 3 years.
STATE: ARIZONA †
INTEREST RATE

Legal: 10%
Judgment: 10% or contractual
STATUTE OF LIMITATIONS (IN YEARS)

Open Acct.: 3
Written Contract: 6 in Az. - 4 outside Az.
Domestic Judgment: 5-additional 5 upon request (indefinitely)
Foreign Judgment: 4
Here are Az. requirements for a collection agency to operate in the state. Check and see if your collectors are legal.

Collection Agency Licensing Requirements:


A person desiring to conduct a collection agency must comply with Arizona's licensing requirements prescribed under Title 32, Article 9, Sec. 32-1001, et seq., of the Arizona Revised Statutes. The requirements include the submission of an application and financial statement, an application fee of $1,500, posting of a bond in an amount based on the gross annual income of the licensee for the preceding year with a minimum amount of $10,000, and a maximum bond amount of $35,000.and compliance with all regulations set forth in the statutory provisions. Application and licensing information may be obtained from the Department of Banking
2910 North 44th Street, Suite 310,
Phoenix, Arizona 85018,
[url]http://www.azbanking.com.[/url]

These requirement are covered by Arizona Revised Statutes 32-1001 to 32-1057 available here. See ARS 6-123, which prescribes the Collection Agency Application Fee of $1,500.00, and is available here.



Review Arizona Revised Statutes here. Always discuss actual cases with your actual legal advisor or legal department. The Arizona Bar Association is linked here.
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