what are my options?

[sugarbaby3000]

What is the name of your state?What is the name of your state?What is the name of your state?What is the name of your state?What is the name of your state? Texas

Hi,

I suffered a financial setback after divorce. My spouse made three times as much as I did and was able to keep the house. I had to pay for the divorce because although he asked for it, he refused to pay for it. It wasn't safe to stay married, either. I am single, no children. I began living off my credit cards to make ends meet and found myself with $35K in credit card debt and cannot obtain a loan to pay them off. I tried Consumer Credit Counseling last December and was told that I would have to pay $800 a month, which I didn’t have. I then joined one of those debt payment companies and was told they would handle any correspondence and calls from creditors. After four months of paying the debt payment company $425 a month, I found out that none of my creditors were being paid. I canceled their services. I began paying the creditors in May 2005 after setting up an arrangement and they have accepted my payments. In June, I was served and now I find myself being sued by one of the creditors, Citibank, for the $25K that I owe. I did have an attorney friend file an answer in court but I can’t afford him any more. He tried contacting the law firm representing Citibank and sent them proof that I had been paying and had an arrangement, but the law firm refused to accept this.

I was notified that a non-jury trial is set for May 2006, which I am looking forward to. I was also notified that a mediator has been assigned the case prior to the trial. When I contacted the mediator to let him know I agree with the date set aside, he informed me that Citibank usually files a Motion for Summary Judgment. I can’t afford legal counsel and was hoping to go to mediation. If the Judge rules in Citibank’s favor, and a judgment is entered against me, what will happen? I rent, I still owe on my car and don’t own anything that could settle the debt or borrow the money. I was hoping to settle with one of the creditors soon and apply those payments to help pay off the next highest account. I obtained a copy of my credit report and saw Citibank and one of the other creditors charged-off the account; I continue to pay them anyway.

I don’t want to file bankruptcy, but what other options do I have?

Thank you for any help.

[JETX]

Originally Posted by sugarbaby3000

He tried contacting the law firm representing Citibank and sent them proof that I had been paying and had an arrangement, but the law firm refused to accept this.

The fact that you have an agreement and are paying does not prohibit a creditor from pursuing additional actions... including filing a lawsuit.

I was notified that a non-jury trial is set for May 2006, which I am looking forward to. I was also notified that a mediator has been assigned the case prior to the trial. When I contacted the mediator to let him know I agree with the date set aside, he informed me that Citibank usually files a Motion for Summary Judgment. I can’t afford legal counsel and was hoping to go to mediation.

Why?? The mediator will only review the facts and help to decide which party is more likely to prevail in court.... and hopefully lead to a settlement. There is nothing in your post to suggest that mediation would be of benefit.... unless you are disputing the amount they claim.

If the Judge rules in Citibank’s favor, and a judgment is entered against me, what will happen?

No one can answer that. They (the judgment creditor) could do anything from nothing at all.... up to seizing any non-exempt assets you might own.

I rent, I still owe on my car and don’t own anything that could settle the debt or borrow the money.

Then it sounds like they will have to wait until you do get something. And since a Texas judgment can be valid pretty much forever (10 years, renewable)... they can wait a long time. All the while, the judgment accrues interest at the same rate as the credit card contracts.

I obtained a copy of my credit report and saw Citibank and one of the other creditors charged-off the account; I continue to pay them anyway.

A 'charge-off' is simply an accounting term. It means nothing to your debt obligation.

I don’t want to file bankruptcy, but what other options do I have?

From your post... not much.

[sugarbaby3000]

Thank you for the information. I will be contacting a bankruptcy attorney first thing in the a.m.