credit card debt/collection agency

live in michigan

have approximately $14,400 in credit card debt. was not able to make minimum payment, tried to negotiate payment plan with creditor, but they refused. couldn't afford to make payments with debt management agency either. now debt has been turned over to collections who have called me at work stating that i will have legal action taken against me unless i can pay or transfer at least $6,000 of the debt, and then make monthly payments of at least $50.00. my questions are, can they take legal action without notifying me in writing? can legal action be taken even though i have been paying what i can afford all along on my debt every month? if they take me to court, how long does it usually take to actually get to court once i'm notified? sould bankruptcy be a vialbe option for me - i rent an apartment, have a car loan, have student loans, medical bills, plus 2 other credit card bills. Total debt is around $56,000.00. i live paycheck to paycheck with no savings. any advice besides cutting back and living within my means, which i have already started to do albeit late in the game?

[bigun]

If they sue, you'll have to be notified. Either a process server hands you the lawsuit or, you get a registered letter from the court. Whatever happens has to conform to state law. How long it takes to go to court depends on how crowed the docket is in your city and if the venue is small claims or circuit court. If it's small claims, it'll be a lot faster process.
As to bk helping, you need to look at just how much can be discharged in bk. Y our student loans will probably survive bk unless there are some extenuating circumstances in your life and, you may wish to reaffirm the auto loan. Take those 2 items out of the equation and how much would be left to discharge in bk?
I have 2 suggestions. Can you defer the stuent loans for 1 year? Would that free up some cash that could go to reducing debt? Next, could you borrow a few grand from a relative or, get a relative to cosign for a loan? If so, try and negoiate a lump sum settlement of 30% or so on the cards in collection.
If all else fails, and you are sued and the creditor gets a judgement against you, then I'd suggest filing bk. If you're living paycheck to paycheck, you can't survive with having the check garnished. Good luck!

[VeronicaGia]

It is very easy to take a deferement or forbearance on your student loans; I just did that for six months and am now back to paying. You don't really need a valid "reason", simply ask for one. You can take it up to a year at a time. Interest does accrue, but it might be worth it if your loan payments are high.

After you have done that, you may want to try a NON-PROFIT credit counseling service. In MI, Profina is one of the largest, but there are others. Call a few up, make sure they are non-profit! Maybe then you can make payments, and you'll have a year deferement on your student loans, so you may be able to get out from under everything. And hopefully within a year, you will be in better financial condition, and can resume student loan payment.

Best of luck.

[VeronicaGia]

Also, a link to the FDCPA (Fair Debt & Collection Practices Act)

Read it, understand it, and make sure your creditors are following it to the letter of the law.


[url]www.cardreport.com/laws/fdcpa.html[/url]