Contacted by law firm regarding CC debt.

[dumbyNYC]

What is the name of your state? New York

I have a friend in new york that has moved around a bit in the last year. Being irresponsible, she did not change the address on her credit card account so she hasn't gotten a statement in a year. And being even more irresponsible, she made no payments during that time. A law firm representing a collector just called her and is demanding the full amount to be paid immediately or else litigation will follow. This is the first time anyone has said anything to her about the debt. Of course, she does not have this money (roughly $5000) and has a hard enough time just paying the rent. What can she possibly do to work out a payment plan or what other options does she have? If this does go to court, what can she expect to happen? Any help is much appreciated.

 

[cmorris]

Your "friend" should send a validation letter, certified mail return receipt, requesting proper validation. That is NOT a computer printout. She should also request to only be contacted via mail (w/ her CURRENT address). She should not ignore this. It is w/in the statute of limitations and she could be sued. If she is sued and ignores it, there will likely be a default judgment entered against her.

Make them PROVE it is her debt. There's case law, FTC opinion letters, and the FDCPA that state what proper validation is. At the very least, it will buy her some time. They do not have to accept a payment plan. And FYI, if they cannot provide proper validation, they cannot continue to try to collect on this debt.

Good luck

 

[dumbyNYC]

Thank you CMorris. This helps a lot.

If this does go to court and a judgement is made, what sort of penalties and costs can she expect? I read that they can garnish up to 25% of wages. Does the court usually rule on the high end of this or do they often rule on a smaller garnishment per paycheck? She has no money in the bank to speak of, no savings, property, car, luxury items or anything worth seizing.

 

[Ladynred]

If this does go to court and a judgement is made, what sort of penalties and costs can she expect?

Attorney's fees and court costs along with interest that accrues on the judgment itself as long as its unpaid.

I read that they can garnish up to 25% of wages. Does the court usually rule on the high end of this or do they often rule on a smaller garnishment per paycheck?

They can take 25% of her net income and you can bet the plaintiff will go for the whole enchilada - they want their money as quickly as they can get it. If 25% would cause her hardship, she can appeal the garnishment.

Who is the collector/law firm ?? It may not be anything more than another collection agency, the demand sounds typical of a CA threat.