It's bad enough to be under the stress and pressure of having too much debt and not being in a position to make adequate payments, but now, you get a SUMMONS!
I'm going to explain not only why it happened, but also what you can do to take care of it.
I think it was Tony Robbins who either used an acronym about FEAR:
WHAT IS FEAR?
- False
- Evidence that
- Appears
- Real
When you get a knock on the door and someone (sometimes a sheriff or police officer) hands you a summons and says, "You've been served", it can be a very fearful experience!
FIRST, DON'T PANIC!
Take a deep breath, sit down and slowly....I said slowly (I know how you feel) the summons.
Most of the time, a summons will read something like this:
"You are hereby required to appear and defend the complaint filed against you in the above-entitled cause within thirty (30) days from the date of service of this summons on you. If you fail to appear and defend, the plaintiff will apply to the court for the relief demanded in the complaint."
It usually goes on to read:
"You must "appear" in this case or the other side will win automatically. To "appear" your must file with the court a legal paper called a "motion" or "answer". The "motion" or "answer" must be given to the court clerk or administrator within 30 days along with the required filing fee. It must be in proper form and have proof of service on the plaintiff's lawyer or, if the plaintiff does not have a lawyer, proof of service on the plaintiff."
OK...now they have your attention! But, before you "get carried away", let's examine the SUMMONS carefully:
"You are hereby required to APPEAR and DEFEND the COMPLAINT FILED AGAINST YOU...
"APPEAR AND DEFEND"
I know it sounds like you must appear in court, but that's not what it means. The phrase, "appear and defend" is further explained in the second paragraph.
The second paragraph (above) also says that you must file an LEGAL PAPER called a MOTION or ANSWER.
This MOTION or ANSWER is, in fact a LEGAL PAPER that you would file with the court if you don't believe you owe or are responsible for the debt they are claiming you owe.
Yes, it will cost you a fee just to file your ANSWER, and it must be filed in the appropriate legal fashion. This usually requires an ATTORNEY to be retained, which also costs you more money!
But, in most cases, the client or DEFENDANT in the claim actually owes the debt, it is not necessary to file an ANSWER.
So, the 30 days to appear and defend doesn't mean you have to go to court!
OK, so what should you do?
Here's what has happened so far:
When you have debts that you are unable to pay, the creditor will send nasty sounding letters and call and call and call (you probably have experience this already).
If you cannot or do not respond by making some form of repayment, then the original creditor may decide to hand over to a COLLECTION AGENCCY or hire an ATTORNEY to file a CLAIM or "COMPLAINT".
Most of the time, the original creditor will use a DEBT COLLECTOR or DEBT COLLECTION AGENCY to attempt to get you to repay the debt. They will start by sending you letters that may sound threatening in an attempt to scare you into paying the debt.
And as you probably know, they will call constantly. Even though we have laws that protect us from harassing phone calls from debt collectors, most people are not aware or do not know how to put a stop to these calls.
The FAIR DEBT COLLECTION PRACTICES ACT clearly spells out what a debt collector CAN and CANNOT DO!
The good news is now, you can put a stop to those calls!
As long as the account is still with the original creditor, they have the right to call you. Now, they must do it according to the FDCPA (above), but you can't put a stop to the calls until the account is turned over to third party collection agency.
You must send a letter and they must stop calling (even though they can continue to send letters).
This will help:
But, even though you can and have put a stop to the calls, in most cases, they are not going to give up trying to collect on the debt.
See my blog on HOW TO DEAL WITH DEBT COLLECTORS for some good tips.
- OK, you've receive the summons.
- You understand that you don't have to appear in court in 30 days
Now what?
You should contact the attorney who filed the claim and attempt to SETTLE THE DEBT by making a lump sum payment for less than the balance due.
This is not always an easy thing to do at this point because the PLAINTIFF (the creditor or debt collector) has had to pay a pretty hefty FEE TO THE ATTORNEY to file the claim, prepare the summons and have it delivered to you.
Yes, many times you can still negotiate a settlement or other reduced repayment plan even though a judgment has been awarded!
Here's an actual example of a settlement we were able to negotiate even though a judgment had been awarded. Click on the link below:
Actual example of a judgment that was settled.
But, if you are unsuccessful in negotiating a settlement, then you might have to attempt to negotiate what is called a STIPULATED AGREEMENT.
In a Stipulated Agreement, you and the plaintiff/attorney for the plaintiff have a legal document written up ( the collector's attorney does this and you will not pay a fee).
The agreement will basically state that if you make a certain dollar amount payment each month until the balance is paid in full, then they will not go forward with any more LEGAL OPTIONS.
WHAT...LEGAL OPTIONS?
When a Plaintiff (the creditor) is awarded a judgment (and they will be in most cases), then they now can choose to do several things...legally, to collect on the debt:
They can get a WRIT OF GARNISHMENT, giving them the ability to take 25% of your take-home pay until the debt is paid in full!
They can get a WRIT OF LEVY, giving them the right to levy one or more of your BANK ACCOUNTS!
Again, before you go into PANIC MODE!!!!
The following sources of income are 100% exempt from any bank or account levy:
- Social Security
- Disability Income
- Unemployment Income
- Retirement Income
- And several other sources
However, if you receive normal income (called W-2 Income) from your employer, and you deposit those funds into your checking or savings account, they can be garnished/levied.
The bank has now option but to obey the Writ of Garnishment delivered!
There is nothing more devastating to someone to deposit their check (from W-2 or other "earned income") and have their check or debit card declined at the grocery store because their account was liquidated over the weekend!
To make sure this doesn't happen, DON'T IGNORE THE SUMMONS!
Hopefully, I have made my point...
Let me summarize (if your still not clear, please re-read this article!):
DO NOT, DO NOT, DO NOT, Ignore a SUMMONS!
If you take the appropriate action (as I've spelled out), you should be able to work out a mutually agreeable option.
If all of this sounds a little intimidating, I understand. If you need more guidance:
