Cap 1 Suing Me - 12 Days To Respond

[Cap1Victim]

Texas

Texas case

My business tanked a few years ago. I went from a healthy six figure income, down to 35K a year. The result was getting behind on my bills. I had credit cards with two companies, one of them being Cap 1. I wrote both companies to explain my situation. The other company put me on a hardship program, Im currrent with them, no issues. Cap 1 is clearly the evil empire. I could go on and on, but here are the facts.

#1- They stated that they were launching a new repayment hardship program and put me on it. Even though I had three cards, they only put me on the program with one of the cards. And the never informed me that I had been approved, or the due date. I found out via correspondence, again, with no details. This was about 18 months ago.

#2- I rushed in a payment. It was three days past the due and within weeks, the charged off all three cards, destroying my credit rating. I filed complaints with the BBB, the Attorney General and their CEO. I got nothing but the run around, nothing was resolved.

#3- Since then, I pay about $20 per card every month. I have missed months but that is rare. 9 out of 12 months have payments, all three cards.

#4- The7 sold the debt, the law firm retained demands very high payment or the lawsuit. Im also behind on taxes. My CPA got the IRS down to $144 a month repayment, because even they agreed, I have no money to pay anything. Many months, I have to borrow from friends just to pay rent. And my dog of 14 years just passed, so yeah, not in a good place.

#5- I got served on Saturday, Jan 28th. The amount is $3,750

MY questions

Ive read through the forums and Im very confused.

#1- What, specific address, do I send my response to?

#2- I get I send certified to the lawyer, do I send certified to the court?

#3- I have copies of everything I have outlined. Do I send that stuff or is this just a paragraph?

#4- Do I have to get the letter notarized?

#5- Is there a specific format I need to follow?

#6- How quickly could Chapter 7 or 11 protection kick in, if I have to go that route?

My goals

#1- I am broke, as stated, so I cannot afford an attorney. Even one that takes payments, I have no clue who I could trust.

#2- I really want to avoid Chapter 7 or 11, if at all possible.

#3- 6-12 months, I might be in a position to negoiate down for a lump sum. Just launched a biz that may or may not take off. So ideally, I would like to buy myself some time. Its just right now that I have no options, $$ wise.

Many thanks for your compassionate advice. Im very stressed and I dont get stressed. Ever.
B

 

[quincy]

Texas

Texas case

... #5- I got served on Saturday, Jan 28th. The amount is $3,750

MY questions

Ive read through the forums and Im very confused.

#1- What, specific address, do I send my response to?

#2- I get I send certified to the lawyer, do I send certified to the court?

#3- I have copies of everything I have outlined. Do I send that stuff or is this just a paragraph?

#4- Do I have to get the letter notarized?

#5- Is there a specific format I need to follow?

#6- How quickly could Chapter 7 or 11 protection kick in, if I have to go that route?

... Im very stressed ...

It is natural to be stressed with all that has gone on in your life.

You ask a lot of questions. Many of them can be answered by reading through the Rules of Civil Procedure.

Here is a link to the Texas Rules: http://www.jp.hctx.net/info/TEXAS RULES OF CIVIL PROCEDURE.pdf

And here is a link to an overview of Texas Bankruptcy Exemptions, should you decide you need to go the bankruptcy route: http://www.nolo.com/legal-encyclopedia/texas-bankruptcy-exemptions.html

I think you are smart to consider other options before filing for bankruptcy.

Good luck.

 

[Cap1Victim]

I read the two links, its hard to get through if you're not a lawyer. But the takeaways are

#1- This is small claims court

#2- As long as the postmark is within the date, Im covered (which still makes me nervous).

Unanswered

#1- Do I send the court certified? I read they go by postmark, is that enough?

#2- Do I send copies, its a lot, of my long fiasco (the paper trail) with Cap 1?

#3- Once my "answer" is sent to the court and the suing lawyer, how much time will that buy me? That will meet the 14 day requirement, then what, in terms of timeline?

 

[Cap1Victim]

And thanks for the links! Sorry, I didnt mention that. Im just really stressed.

 

[adjusterjack]

#1- Do I send the court certified? I read they go by postmark, is that enough?

I strongly suggest that you not rely on mail. Take your answer and several copies to the court house and file it personally. Get your copies date stamped by the clerk, then mail, fax or deliver a stamped copy to the plaintiff's attorney.

#2- Do I send copies, its a lot, of my long fiasco (the paper trail) with Cap 1?

No.

The time to present your "evidence" is at trial. You don't attach anything to your answer. Besides, your paper trail is likely to be irrelevant and inadmissible if there is nothing in there to prove that you don't owe the money.

That's the ONLY thing the court will be concerned with. Do you owe the money or not?

#3- Once my "answer" is sent to the court and the suing lawyer, how much time will that buy me? That will meet the 14 day requirement, then what, in terms of timeline?

The following rule answers that question. When the trial happens depends on the court's schedule but even if you are notified tomorrow you will still have at least 45 days.

RULE 503.3. SETTINGS AND NOTICE; POSTPONING TRIAL
(a) Settings and Notice. After the defendant answers, the case will be set on a trial docket at the
discretion of the judge. The court must send a notice of the date, time, and place of this setting to
all parties at their address of record no less than 45 days before the setting date, unless the judge
determines that an earlier setting is required in the interest of justice. Reasonable notice of all
subsequent settings must be sent to all parties at their addresses of record.

I hope you understand that credit card contracts have attorney fee provisions that say loser pays winner's attorney fees. If the creditor continues to rack up attorney fees, especially for trial, your $3750 lawsuit can potentially cost you thousands of dollars more than just that amount.

Also understand that, whatever your gripes are about how Cap 1 handled all of this, you likely have no defense against owing the money and Cap 1 is likely to get a judgment against you no matter what you say in court.

 

[Cap1Victim]

Thanks for the detailed response. Im not looking to avoid the debt, never have been. What I am looking for and have always been looking for, is a payment plan I can afford, which their counsel refuses to engage with me on. Their approach the entire time has been, pay the very high monthly we have randomly determined, or we sue you. Lovely system we have.

If, after my response, they continue to play hardball and I have no choice to go Cph 7 or 11, how soon does that protection kick in?

 

[CTU]

Thanks for the detailed response. Im not looking to avoid the debt, never have been. What I am looking for and have always been looking for, is a payment plan I can afford, which their counsel refuses to engage with me on. Their approach the entire time has been, pay the very high monthly we have randomly determined, or we sue you. Lovely system we have.

If, after my response, they continue to play hardball and I have no choice to go Cph 7 or 11, how soon does that protection kick in?

Immediately.

Why CAP1 is the bad guy here is beyond me. You agreed to the original payment terms. You didn't hold up your end of the bargain. This isn't their fault.

 

[quincy]

#1- Do I send the court certified? I read they go by postmark, is that enough?

#2- Do I send copies, its a lot, of my long fiasco (the paper trail) with Cap 1?

#3- Once my "answer" is sent to the court and the suing lawyer, how much time will that buy me? That will meet the 14 day requirement, then what, in terms of timeline?

I agree with adjusterjack that it will be far simpler for you to go to the court.

The court clerk, while s/he cannot offer legal advice, can guide you to the standard answer/response form. Clerks can answer some of your questions and clerks often will take your filled out forms and see that they are sent to the proper parties for you, which relieves you of the need to mail them yourself.

You should have the opportunity before the trial to sit down with Capitol One's attorney. You could have a chance to try once again to negotiate a payment agreement before a judgment is entered against you. Capitol One, however, does not have to negotiate with you and, seeing as how you did not meet the terms of the previous agreement, it is unlikely at this late date that they will.

If you think you might have a defense to the claim against you (e.g., statute of limitations), you will want to discuss this defense with an attorney in your area prior to trial. From what you have written, though, I am not seeing a defense.

Good luck, Cap1Victim.

 

[Cap1Victim]

Actually, I did meet their terms until they did the charge off. I was the one who proactively sought them to work this out. When I say their process is massively broken, its is a huge understatement. The other company, all payments made (because they worked with me), no issues, no charge offs, all is well. But if I can't do anything to avoid the judgement, and I can't come up with the moola within 45 days, it sounds like I'll have no choice but to BK, which I really dont want to do. I dont see how they win from that? Push things to only get nothing?

I'll hand everything in by hand. Thanks for the feedback.

 

[adjusterjack]

If, after my response, they continue to play hardball and I have no choice to go Cph 7 or 11, how soon does that protection kick in?

As soon as you file your bankruptcy petition with the bankruptcy court all collection efforts and ongoing lawsuits are stayed.

Ch 7 discharges debts.

Ch 11 is a business reorganization bankruptcy.

Ch 13 allows you to pay your debts more comfortably up to a certain amount during a 3-5 year period then discharges the remaining amounts.

You might want to think twice about bankruptcy.

Texas prohibits wage garnishment for debts and you can avoid doing business with banks and avoid bank account levy.

That might give you some leverage to negotiate a better payment plan. Just make sure you are able to pay more than the $20 per month chump change you are paying now.

You might also look into getting together enough cash to offer a lump sum discounted settlement. Creditors will often settle for 60% to 80% of the debts just to get cash and avoid attorney fees that they might never get back.

 

[Cap1Victim]

$60 a month is not chump change to me. I lost 75% of my income for the first time in 30+ years and its been that way for almost three years, which bleed all my accounts dry. My business is an S-Corp, so there are no wages, per se. With the huge drop in income, my CPA stopped cutting me checks last year.

Is a BK worse than a bunch of leins and levys on my credit? Because I have been bleeding out for almost three years, nothing to do a lump sum with or I would. All of this could change in 4-6 months. Should my income increase, I would be more than willing to up my payment, but thus far, they have taken an all or nothing approach.

 

[adjusterjack]

$60 a month is not chump change to me.

No. But it is to your creditor.

Is a BK worse than a bunch of leins and levys on my credit? Because I have been bleeding out for almost three years, nothing to do a lump sum with or I would.

BK would probably be better. Your credit score is already tanked, can't get much worse. When all your debts get discharged a BK on your credit report won't make it much worse.

Just understand that a bankruptcy will cost close to $2000 and a lawyer will want that up front, in full, before he starts doing anything for you beyond the initial consultation.