In a debt elimination prog; being sued; scared

[toodlesg]

What is the name of your state? TX

About a year ago, we entered into a debt elimination program. We were to stop making monthly payments and start sving $ so we could pay back approx 40% of what the orig balance owed was. We have had several large bills (replace roof due to storm damage, replace a/c, etc) , so our savings is till basically nothing (even though we are trying to save something each month), and we are barely making ends meet. Law firms are contacting us constantly, and even though we keep telling them (verbally and in writing) we're working with a debt elim co, they're still sending us court papers saying judgements have been entered against us and that they're going to sue us. The debt co keeps saying that they can't take away our house or car, but I'm beginning to not believe them. Can our wages be garnished? Are we going to end up in court? Are we going to have our finances paraded around in front of strangers? Is bankruptcy going to be our only option? Is there anything we can do legally? We know we owe the debts and have every intention to pay off everyone. HELP! We're scared and don't know what to do!

 

[willingtocope]

Take a deep breath...

Take a deep breath. You're not alone. Lots of other good people find themselves in the same position you're in.

First, so called "debt elimination" companies are almost all scams. Did they ask for money up front? Have they indeed contacted any of your creditors? Do you have any evidence, other than their word, that they've done anything to help you?


The Fair Debt Collection Practices Act has specific rules that debt collectors must follow...it has nothing to do with whether you owe the money or not...if these people have violated the law, call them on it.

You may indeed wind up filing Bankruptcy. But, Texas is a pretty consumer friendly state, so its unlikely that you'll lose your house and car, assuming you still have an income and can meet the payments. BK isn't something to be proud of, but its also not the end of the world. Its intended to give you a chance to start over...

 

[Ladynred]

TX law has a 100% homestead exemption - they cannot touch your house.
TX law also allows 1 car per driver - they cannot touch your vehicle
TX law does NOT allow wage garnishment.

However, if you end up with judgments against you, they CAN sieze your bank account(s) and any non-exempt property you may have. Judgments last 10 years minimum and can be renewed, so they can end up hounding you for a long, long time.

If you've been sent court papers and you've ignored them, you likely ALREADY have judgments against you - those papers ARE lawsuits. I suggest that you call the courthouse where you live and find out if anything really has been filed against you.

You must also understand that many "law firms" are, in fact, nothing more than a collection agency. The words 'law firm' and 'attorney' are more intimidating to people than just a 'collection agency'.

Get out of the debt elimination program, they are NOT helping, they are getting you sued, and they are doing NOTHING that you cannot do yourself - and you'll save your hard-earned money by not having to pay their fee. Whatever you send to this debt elimination company, they are first going to skim off some percentage of it for their own profits.

How old are these debts ? When did you last pay the original creditors ??

 

[willingtocope]

Are they really judgements?

One of the tricks that lawyer/debt collectors use is to send you papers that LOOK like you've been sued, or LOOK like there's a judgement entered against you, or even one of the phoney Arbitration Awards where they get their captive arbitrator to award them a "judgement". They're trying to panic you into paying...

You need to check with your local clerk of courts to see if any legal action has been take against you. If not, you've got these collectors on another violation of the FDCPA.

 

[jazzy13]

FTC suit vs. Debt Companies

the Federal Trade Commission (FTC) has been investigating and has filed suit against a major Debt Negotiating Company, called National Consumer Council, which included many subsideraries like Solidium, Financial Rescue, etc. that claimed to be able to 'settle' consumers debts for 40% or less. Consumer's should be aware that these companies almost never have any paperwork or contracts with the creditors that you owe that authorize them to settle the accounts you list with them. Law firms will rightfully refuse to deal at all with those companies, therefore following a debt company's advice to ignore your creditors and pay them fees will not improve your credit and probably get you sued, in addtion to scamming you out of your money that you should've paid tho the creditor's you owe. Remember, there is no free ride, no way to get away with not paying back money you legally owe. You may get a break here and there, but deliquent accounts wl affect your financial future for as long as you allow them to remain deliquent. Most people just need to return to the days when as the saying goes, " If you dont have the money now to buy it, you cant afford it on credit."