Credit Card Debt Articles

Three Alternatives to Getting Sued over Credit Card Debt

Getting sued over credit card debt is a big problem, and a big inconvenience, to say the least. Some credit card companies are very stringent in their terms, imposing large penalties on missed or late payments, leaving you even more stuck to bigger and bigger debts. And then, before you are even able to think of what to do, you are slapped with a subpoena to appear in court.

For any ordinary law-abiding person, getting sued over credit card debt can certainly be a frightening thing to happen. To avoid getting into such a compromising situation, the moment it dawns on you that you might be sued over credit card debts (you will know that for sure if you are habitually delinquent in your payments), begin considering any of these three options: (1) file for bankruptcy; (2) get a non-profit credit counseling service; or (3) drastically cut down your expenses to save money to pay your debts.

1. Filing for Bankruptcy

This is not the first option, nor the easiest one, and should be resorted to only if your debt situation is so bad that there is absolutely no other way that you can pay your debt unless you declare bankruptcy. Before you take any definite action, consult with a bankruptcy lawyer to find out if, considering your situation, there is a good chance that filing for bankruptcy will actually lessen or completely remove your debt obligations and avoid getting sued over credit card debt. If not, perhaps the only good that filing for bankruptcy will do you is to give you temporary respite from your creditorís persistent threats and demands, or give you a little more time to do some debt restructuring.

Declaring bankruptcy will also leave a negative mark on your credit rating and may tarnish your reputation among financial facilities. So, unless utterly necessary and all other options have been expended, do not file for bankruptcy.

2. Getting Counseling Service

Consider the various possibilities that an acceptable payment arrangement can still be made with your creditor. Get the services of a non-profit credit counseling expert or agency the moment you think you will get sued over credit card debt. One possibility is for the counseling service to access your income and debts, then make representation for you with your creditor. Then he makes the payment to the creditor according to an agreed payment scheme.

Getting a credit counseling agency to mediate for you with the credit card company may also have some negative effects on your credit rating, but these are not as bad as what filing for bankruptcy does.

3. Drastically Cutting Down Expenses

The first and easiest option, actually, is to cut down on your normal expenses to come up with an amount sufficient to pay off your debts. Reexamine your expenses and see what items you can afford to sacrifice. Change your spending habits, modify your lifestyle if needed, at least for the time being while you are still in this predicament.

And let your creditors know that you are making these sacrifices just so you can pay them. Sometimes, if they see that you are sincere in finding ways to pay them, they may reconsider their decision to sue you, and be willing to extend the time they are giving you to settle your debts.