What to Do If You Have Been Sued by a Credit Card Company

According to a survey by GOBankingRates, about 14 million people in the United States owe credit card debt worth $10,000 or more. In another report by CNBC, the total credit card debt in the country hit an all-time high of $930 billion in 2019. While some have no trouble settling all their debt, others aren’t fortunate enough to face legal action. 

Borrowing money can be beneficial, especially in purchasing a home, funding a child’s college education, and setting up a small business. However, there are situations when borrowers are unable to pay their dues in time. This often gives credit card companies a reason to sue borrowers for missed payments.

Being at the receiving end of a legal complaint can be unnerving, but that doesn’t mean you can’t dispute the claims of your creditors and give yourself peace of mind. If you get sued by your credit card company, here’s what you can do to secure your financial future.

 Make Sure You Are Informed About Your Debt Situation

Credit card companies use a variety of tools to analyze your debt situation. There are cases when they make errors, especially when it comes to informing you before taking any legal action. These companies are required to follow the Fair Debt Collection Practices Act (FDCPA), a law designed to protect borrowers like yourself from unscrupulous debt collection practices.

Under the law, credit card companies are allowed to follow up on your debt payments via email, phone call, or SMS. They are also required to provide information about the amount of debt you owe and the creditor that owns the debt. Credit card companies violate the FDCPA if they threaten legal action despite the absence of advanced information about your debt. When this happens, you may have to countersue if the creditor refuses to settle. 

Know if You Are Subject to Debt Collection

If you have made timely payments to your credit card companies, you should be safe from any legal repercussions. However, if they demand to pay an amount you don’t owe, you may need to dig deeper and check if your credit situation is in order. With the amount of data credit card companies sift through, there’s a good chance they will overlook certain issues that could lead to inaccurate reporting. 

If you are a victim of fraud or identity theft, you can dispute a creditor’s claim by writing a letter asking them to verify the debt. Once they have responded by insisting that you owe the debt, send a dispute letter and request a copy of the original bill. Throughout the exchange, keep copies of their response letters and make sure to request a return receipt. You can always cite fraudulent charges as your defense if you suspect that you didn’t approve the debt in the first place. 

 Review The Statute Of Limitations In Your State

In legal terms, a statute of limitations sets the time limit for suing a person or organization. Understanding this concept is crucial in making sure that credit card companies are acting fairly in trying to recover the amount you owe. Every state has its statute of limitations for suing borrowers for missed payments. In Florida, for instance, creditors are allowed to sue you within four years from the date of your last missed payment.

If a credit card company files a lawsuit against you, make sure it was done within your state’s statute of limitations. However, if you can make a payment during that period, the statute will reset to zero. Your credit card company may also choose to extend the repayment period. In effect, this will extend the statute of limitations. 

Get A Legal Expert By Your Side

Regardless of your debt situation, you need to get a lawyer to help you make better decisions and determine what to do without impacting your credit score and financial future. Credit card companies will use any means they deem necessary to make you pay even if you don’t owe the debt, so you should get a credit card defense attorney to help you pull through.

With the right expert, you can prevent debt collectors from overextending their rights and ensure that you have a platform for disproving their claims. During a debt settlement negotiation, your lawyer can also face your creditors and strike a favorable deal.  That way, you can get out of debt without facing serious legal repercussions and give yourself enough room for financial recovery. 

Are you getting sued by your credit card company? Know your rights and gain peace of mind by knowing what to do.