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Being sued over your delinquent credit card debt? Here’s what to do
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No matter how careful you are about your finances, it’s easy to find yourself in over your head with credit card debt. The convenience of plastic can lull you into a false sense of financial security, leading to overspending and the accumulation of high-interest balances. And before you know it, what started as a simple way to manage expenses can spiral into a daunting financial burden.
The situation has become even more precarious in recent years as credit card interest rates have climbed to near-record highs. After all, as the cost of borrowing increases, so does the difficulty of paying down existing debts. In turn, many cardholders find themselves trapped in a cycle of making minimum payments that barely cover the accruing interest, let alone chip away at the principal balance.
And if you’ve already fallen behind on your credit card payments, the repercussions can include the threat of legal action. While being sued is serious, the good news is that there are steps you can take to protect yourself and work toward resolving your credit card debt issues, even in the face of legal action.
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What to do when being sued over delinquent credit card debt
If you’re being sued over your credit card debt, it could help to take the following steps:
Verify the debt details
The first step when faced with a lawsuit over credit card debt is to ensure that the debt in question is yours and that the amount being claimed is accurate. To do this, request a debt validation from the creditor or collection agency. This should include details about the original creditor, the amount owed and when the debt was incurred.
You should also check the statute of limitations for credit card debt in your state. If the debt is older than this time limit, it may be considered “time-barred,” and the creditor may not have the legal right to sue you for payment. It also makes sense to review your own records and credit reports to cross-reference the information provided.
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Consider your options
You generally have three main options when sued for credit card debt:
Try to fight the lawsuit
If you have a strong defense or don’t believe you owe the money, you may choose to fight the case in court. If you want to take this route, it may be worth consulting with a consumer law attorney first. They can help you understand your rights, evaluate your options and potentially represent you in court if necessary.
An attorney can also help you identify any violations of consumer protection laws by the creditor or debt collector, which could strengthen your position or even lead to the case being dismissed. And they can help you file a written response with the court before the deadline specified in the summons.
Try to settle the debt
You can also try to negotiate a settlement with the creditor for less than the full amount owed. In this case, you may want to seriously consider enrolling in a credit card debt forgiveness program through a debt relief company to take advantage of what it can offer you.
When you enroll in a debt forgiveness program, the experts will try and negotiate with your creditors to settle the debt for less than the full amount owed, typically in return for a lump sum payment on the account. This can be an effective way to resolve your debt and avoid the courtroom, but it does come with risks, including potential damage to your credit score.
File for bankruptcy
In some cases, bankruptcy might be the best option to deal with overwhelming amounts of credit card debt. There are two types of bankruptcies to consider in this case:
- Chapter 7: Often called “liquidation bankruptcy,” it can eliminate most unsecured debts, including credit card debt.
- Chapter 13: Known as “reorganization bankruptcy,” it allows you to keep your assets while setting up a repayment plan over three to five years.
Once filed, creditors must cease all collection activities, including lawsuits — so by filing for bankruptcy, you may be able to halt the legal actions against you. However, filing for bankruptcy also comes with serious financial and credit repercussions, so it’s important to do your homework and consider all of the potential repercussions before doing so.
Prepare for the aftermath
Whether you decide to settle with your creditors or pursue the case in court, make sure you’re prepared for the impact the situation will have on your credit score. No matter the outcome, having delinquent credit card debt reflected on your credit report is damaging to your finances, so it’s important to start planning how you’ll rebuild moving forward.
The bottom line
Being sued over credit card debt is a serious matter, but it’s not the end of the world. By taking prompt, informed action, you can work toward resolving your debt issues and rebuilding your financial health. Whether it’s settling your debt, mounting a legal defense or filing for bankruptcy, there are options available to help you navigate this challenging situation and move toward a more stable financial future.
The International Brotherhood of Teamsters says workers at seven Amazon facilities will begin a strike Thursday morning in an effort by the union to pressure the e-commerce giant for a labor agreement during a key shopping period.
The Teamsters say the workers, who authorized walkouts in the past few days, are joining the picket line after Amazon ignored a Dec. 15 deadline the union set for contract negotiations. Amazon says it doesn’t expect any impact on its operations during what the union calls the largest strike against the company in U.S. history.
The Teamsters say they represent nearly 10,000 workers at 10 Amazon facilities, a small portion of the 1.5 million people Amazon employs in its warehouses and corporate offices.
Amazon is ranked No. 2 on the Fortune 500 list of the nation’s largest companies.
At a warehouse in the New York City borough of Staten Island, thousands of workers who voted for the Amazon Labor Union in 2022 and have since affiliated with the Teamsters. At the other facilities, employees – including many delivery drivers – have unionized with them by demonstrating majority support but without holding government-administered elections.
The strikes happening Thursday are taking place at an Amazon warehouse in San Francisco and six delivery stations in southern California, New York City, Atlanta and the Chicago suburb of Skokie, Illinois, according to the union’s announcement. Amazon workers at the other facilities are “prepared to join” them, the union said.
“Amazon is pushing its workers closer to the picket line by failing to show them the respect they have earned,” Teamsters General President Sean M. O’Brien said in a statement.
“If your package is delayed during the holidays, you can blame Amazon’s insatiable greed. We gave Amazon a clear deadline to come to the table and do right by our members. They ignored it,” he said.
The Seattle-based online retailer has been seeking to re-do the election that led to the union victory at the warehouse on Staten Island, which the Teamsters now represent. In the process, the company has filed a lawsuit challenging the constitutionality of the National Labor Relations Board.
Meanwhile, Amazon says the delivery drivers, which the Teamsters have organized for more than a year, aren’t its employees. Under its business model, the drivers work for third-party businesses, called Delivery Service Partners, who drop off millions of packages to customers everyday.
“For more than a year now, the Teamsters have continued to intentionally mislead the public – claiming that they represent ‘thousands of Amazon employees and drivers’. They don’t, and this is another attempt to push a false narrative,” Amazon spokesperson Kelly Nantel said in a statement. “The truth is that the Teamsters have actively threatened, intimidated, and attempted to coerce Amazon employees and third-party drivers to join them, which is illegal and is the subject of multiple pending unfair labor practice charges against the union.“
The Teamsters have argued Amazon essentially controls everything the drivers do and should be classified as an employer.
Some U.S. labor regulators have sided with the union in filings made before the NLRB. In September, Amazon boosted pay for the drivers amid the growing pressure.
NEW YORK — The Teamsters union is launching a strike against Amazon at numerous locations across the country, including in Maspeth, Queens.
The Teamsters are calling it the largest strike against Amazon in United States history, and it’s set to begin at 6 a.m. Thursday. In addition to New York City, workers will be joining picket lines in Atlanta, Southern California, San Francisco and Illinois.
In a video announcement released Wednesday night, workers voiced their frustrations.
“Us being strike ready means we’re fed up, and Amazon is clearly ignoring us and we want to be heard,” one worker says in the video.
“It’s really exciting. We’re taking steps for ourselves to win better conditions, better benefits, better wages,” another worker in the video says.
The union says it represents about 10,000 Amazon employees and that Amazon ignored a deadline to come to the table and negotiate. The $2 trillion company doesn’t pay employees enough to make ends meet, the union asserts.
At the height of the holiday season, many are wondering what this means for packages currently in transit.
Teamsters President Sean O’Brien said, “If your package is delayed during the holidays, you can blame Amazon’s insatiable greed.”
Amazon says Teamsters are misleading the public
An Amazon spokesperson says the Teamsters are misleading the public and do not represent any Amazon employees, despite any claims.
“The truth is that the Teamsters have actively threatened, intimidated, and attempted to coerce Amazon employees and third-party drivers to join them, which is illegal and is the subject of multiple pending unfair labor practice charges against the union,” the spokesperson said in a statement.
An Amazon representative says the company doesn’t expect operations to be impacted.
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