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I’m Being Sued By Capital One. Should I Go Bankrupt? – Laura

“Dear Steve,

My husband and I have been struggling for over a while now. I lost my job in the middle of July 2005 which cause us to default on our credit cards in September. I took any kind of job I could, until I finally found stable work in October of 2008. Just when we thought we would be able to get back on track, my husband lost his job in March. We are again struggling to make ends meet and hoping not to lose our home.

In June of this year, I was sued by an attorney representing Capital One for a credit card that I stopped paying in September 2005. It was charged off by Capital One in March 2006 for the amount of $979. I have asked for proof of debt and was sent a copy of the March 2006 statement showing the balance. My court date is October 21st and they are suing for $1989 plus court fees and attorney fees. I want to know if it’s too late to settle. If not, what would be a reasonable amount? I have spoken with an attorney who said that we would qualify for a Chapter 7 bankruptcy but I would really like to avoid that since the Statute of limitations will be up by the end of this month. Should I tell their attorney that I will file bankruptcy if they don’t work with us? What advise can you give me? I don’t want to file bankruptcy but will before I get a judgment against me.

Thank you for your help,

Laura”

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The Answer

 

Dear Laura,

It is never too late to settle but in order to settle it will require both you and the attorneys to agree on a figure. And they may demand that payment in one lump-sum.

It doesn’t hurt to ask them but be prepared for them not to agree. At this point, their stronger play is to sue you. And as far as threatening them with bankruptcy, not a big deal. You either will or you won’t. They’ve heard the threat a thousand times and it does not matter to them.

Do you have other debts as well or is this the only outstanding debt you have? I can’t imagine that you’d go bankrupt over just this one debt.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

Im Being Sued By Capital One. Should I Go Bankrupt?   Laura
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P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • chari

    hi steve. i just recieved a letter from bank of america that they are suing me for nonpayment on a credit card.  i have been working for over a year to try to settle but they never agreed to an amount.  after my purse was stolen and my checking account emptied, i tried debt consolidation.  it was working out well but then i got pregnant and my husband decided to do what men do to their pregnant wives, he left.  my income went from two to one but the debt didn’t go anywhere.  during my maternity leave my income went down to only 60% and i was barely making it with 100%.  now i’m not sure what to do.

  • chari

    hi steve. i just recieved a letter from bank of america that they are suing me for nonpayment on a credit card.  i have been working for over a year to try to settle but they never agreed to an amount.  after my purse was stolen and my checking account emptied, i tried debt consolidation.  it was working out well but then i got pregnant and my husband decided to do what men do to their pregnant wives, he left.  my income went from two to one but the debt didn’t go anywhere.  during my maternity leave my income went down to only 60% and i was barely making it with 100%.  now i’m not sure what to do. 

  • Steve Rhode

    There is no substitution for legal help from an attorney but if you want a debt coach that might be able to help guide you on this, call Damon Day.

  • Sara

    Hi Steve
    Have been sued by LVNV – read alot of bad things about how they work. My debt is 7 years old and I can’t remember if I made a payment – I know I would have tried but I remember them asking for a lump sum and I couldn’t do that . The debt has grown now to around $5,340. They are suing me for mediation – I can’t seem to find an attorney who will help with that – they all only do bankruptcy and I’d rather work something else out. Can I call the attorney’s who are suing me or will that make it worse. Need help quick

  • Sara

    Hi Steve
    Have been sued by LVNV – read alot of bad things about how they work. My debt is 7 years old and I can’t remember if I made a payment – I know I would have tried but I remember them asking for a lump sum and I couldn’t do that . The debt has grown now to around $5,340. They are suing me for mediation – I can’t seem to find an attorney who will help with that – they all only do bankruptcy and I’d rather work something else out. Can I call the attorney’s who are suing me or will that make it worse. Need help quick

    • http://GetOutOfDebt.org Steve Rhode

      There is no substitution for legal help from an attorney but if you want a debt coach that might be able to help guide you on this, call Damon Day.

  • maria

    Dear Steve, one of my creditors is suing me and i really don’t know what to do. I was always good in making my payments until my husband became unemployed a year ago. Right now, we are solely living on my paycheck and have about $100 left after all utilities and mortgage are paid. I can’t afford a lawyer but i feel like i should get one since I am from a different country and i really don’t know much about these things. Right now, i am very scared about the whole thing and am seeking for some informations or anything that can help me get through this.

    maria

    • http://GetOutOfDebt.org Steve Rhode

      Maria,

      You need a lawyer, but a bankruptcy layer. Bankruptcy will give you legal protection from your creditors and allow you to repay what you can afford, if any, on your debts. Find a local bankruptcy attorney you like and talk openly with them about your situation.

      Steve

  • Laura

    Thank you Steve, for your response and advise. We have other credit card debt but only three are within the statute of limitations. These will also be past the statute in about three months. The attorney for Capital One filed the suit on 6/22/09 and the statute was up on 9/18/09. I just received a response from the letter I sent them requesting validation of the debt. I asked for the following:

    1. Agreement with your client that authorizes you to collect on this alleged debt.
    Their response: Denied due to attorney client privilege and irrelevance to the subject matter of the pending litigation.

    2. Agreement that bears signature of the alleged debtor wherein he promises to pay the creditor.
    Their response: They will be produced at trial. Be advised that the Plaintiff may need to try to obtain documents from third-parties whom are not within its control. Plaintiff reserves the right to supplement its production upon receipt of such documents.

    3. Complete payment history on this account so as to prove that the debt amount you wish to collect is correct.
    Their response: Not relevant to the subject matter of the pending litigation and not being reasonably calculated to lead to the discovery of admissible evidence. Also, unduly burdensome, not relevant and harassing.

    So all I have is a copy of a statement they sent dated 3/19/2006, six months after I stopped making payments, for the amount of $979.30.

    I decided to try to settle the debt and called their attorney yesterday morning, 10/07/09. I made it clear that although I was not admitting to the debt, I would prefer to settle at this point than to file bankruptcy but would do so if they weren’t willing to settle. After haggling with them they agreed to a settlement (by phone) for five installments of $293 saying they would email the settlement agreement right away. Because I did not receive the agreement, I called them yesterday afternoon and was told they had an incorrect email address and would email it to me today. I still have not received it. Now I’m wondering if they’re playing games with me. Would they have a reason to? After all, they would be getting almost 75% of the debt amount.

    Now I don’t know what to do. I’m worried about calling them again for appearing too anxious. Do you think I should file a motion to dismiss due to the statute of limitations so they’ll have the burden of proving that I made a payment within the statute? I’m starting to wonder if they even have or can obtain the documentation, although they seemed to have their ducks in a row so far. I just seems strange that they refused to send them to me. Any advise would be greatly appreciated.

    Thank you again,
    Laura

    • http://GetOutOfDebt.org Steve Rhode

      Laura,

      The best advice I can give you is for you to talk this issue over with a local attorney. I can’t answer your legal questions. I am not a lawyer.

      As far as calling them back again, I would. They will either provide the deal in writing or they are just pulling your leg on the deal. The other reason they may not be delivering the deal in writing is they have no authority to negotiate on behalf of the creditor.

      Steve

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