Debts In A Divorce Decree

QUESTION: I financed a car with my ex-wife. The divorce decree states that the vehicle and the debt for it are hers.

She has not been paying on the auto loan, and it is hurting my credit. Do I have any legal recourse?

ANSWER: From a credit/debt rights perspective: Notifying the lender and/or the credit bureaus that your ex spouse was given the car and the car note does NOT relieve you from the liability. Family courts and divorce-court judges cannot force the bank (not a party in the divorce lawsuit) to agree to drop you as liable on the car note. Unfortunately, most divorce attorneys do not go into that sort of detail with their clients.

The only way you can save your credit is by making the payments yourself or encouraging your ex-wife to sell the car. If you make the payments yourself, you will probably have recourse to go back to family court and demand that your ex-wife reimburse you. If you convince your ex-wife to sell the car, any deficiency between the amount owed less the amount recovered through the sale is still your liability.

I would strongly recommend you do everything in your capacity to avoid the vehicle being repossessed. From a credit/debt perspective, a repo is even worse than a late payment or two.

On another note: if the vehicle does get repossessed, you should anticipate getting notice from the lender before the car is sold. That notice is required by Texas law and you should allow a consumer rights attorney to have a look at it to determine that your rights have not been violated. The Texas Finance Code has some terrific relief (damages) for consumers when that letter following repossession is defective.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Statute of Limitations On Unsecured Debts

QUESTION: I understand there is a statue of limitation of 4 years to collect unsecure debt (say, credit card debt). The creditor sold the debt to a collection agency at the end of the 4th year of the debt. My question is would the clock reset on this debt account? I meant a 4 years statue of limitation starts all over again with the new collection agency? what if this collection agency now sold the debt to the second collection agency after number of years unsuccessfully to collect, and the circle repeats itself. What rights as a consumer of unsecure debt has to get this old debt off the record for good?

ANSWER: It sounds like your question relates to credit reporting more than potential lawsuits to collect the debt.
The clock for the statute of limitations on debt starts at the date of default. (Some creditors like to argue the clock starts from the date of chargeoff – -180 days after default.) Unless YOU make a payment, nothing else will restart that clock.
The statute of limitations to collect the debt in court is 4 years.
The amount of time that the debt will appear on your credit report is 7 years from the date of default. It makes no difference how many times the debt was bought and sold, it is still seven years. If you make a payment to any debt collector or debt buyer along the way, then the clock starts all over again.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Defaulted PayDay Loan

QUESTION: Can I be sued in the Texas for a defaulted online payday loan?

I taken out a few payday loans online and pretty much got in over my head paying them back ! Can I be sued in Texas?

ANSWER: Most payday lenders do not sue in Texas. Having said that, they are certainly entitled to sue you if you defaulted on a loan.

I would be curious to know who is threatening the lawsuit and whether they are a “usual suspect” – – the kind of payday lender that actually does file suit in Texas. If they are not customarily in court, then their threat is illegal, and possibly a violation of either the Texas Debt Collection Act and/or the Federal Fair Debt Collection Practices Act. The collection industry for payday lenders is infamous for being abusive. I would suggest you keep track of all collection phone calls and keep all of the collection letters.

If the threat to sue is in writing, I would suggest you forward a copy to a consumer rights attorney. If the threat to sue is made verbally, you might still want to talk to an experienced consumer rights attorney who can do a bit of research and find out whether this collector is blowing smoke, or not.

Finally, you might want to have a look at your credit bureau reports through www.AnnualCreditReport.com (That is where you can get your credit reports for free.)

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Not Showing Up To A Civil Suit Court Appearance

QUESTION: What would happen if I do not show up to a hearing concerning credit card breach of contract?

I am a house wife who made regular payments until my husband stopped giving me any money to pay on credit card and anything else at all . I have no income at all to work with and had to move out of our house and in with family just to stay alive due to him canceling my medical insurance and not buying food for the house now I am being sued.

ANSWER: The collection industry can be ruthless. They don’t care what your circumstances: if they can legally collect against you, they will.

Depending on all of the circumstances surrounding your finances, you may want to consider bankruptcy. Bankruptcy will stop the lawsuit against you dead in its tracks.

Otherwise, I suggest you do everything possible to defend yourself. If you/family can afford to hire a consumer rights attorney, that’s your best bet. The creditor/plaintiff is likely to get a judgment against you by default. Even if you cannot afford to pay for the judgment now, the judgment-creditors are patient: they will wait until you find employment, re-marry, gain an inheritance, or win the lottery. Meanwhile, a judgment on your credit reports can be devastating. You should do everything you can to avoid having a judgment entered against you.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Getting Sued Over A Debt Already Paid

QUESTION: A collection agency says they’re going to sue me over a debt I already paid, I don’t know what to do.

I have a few emails of paid in full, but a couple of the companies didn’t send me anything, and when I tried to call them it says it’s no longer a working number.

ANSWER: First of all, I would suggest that you pull a copy of your credit bureau reports. You may obtain a free copy through www. AnnualCreditReport.com It is the only website that the Federal Trade Commission has approved of for a free credit report. You might find useful information on that website. Also, do you have old bank statements or cancelled checks to prove you paid?

If a third party debt collector is threatening to sue you on a debt that has been paid (whether you can prove it right now, OR NOT) then it seems your rights have been violated. I would suggest you contact a consumer rights attorney who has experience going after abusive debt collectors. They will probably want to look up this debt collector that is threatening to sue you. Specifically, they will want to see if this debt buyer is a common litigator; and also, they will want to find out if this debt collector has a surety bond on file with the Texas Secretary of State. If they do not, then this whole thing sounds like a scam- an illegal scam.

Keep in mind that the federal Fair Debt Collection Practices Act allows you to collect a statutory award, other damages, as well as your attorney fees. That is the reason why many consumer rights attorneys do not charge clients up front for their time. They can get paid for by the defendants. I strongly suggest you get your payment history together and call a consumer rights attorney licensed in Texas.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Sued By A Junk Debt Collector

QUESTION: Sued by a junk debt collector for $1500 on unsecured CC debt from 2011.  This clearly seems to be an attempt to get a default judgment by an attorney who expects that I will not answer. I’ll pay $250 to any licensed TX attorney who will answer on my behalf in the expectation that the junk debt collector will abandon hope due to the presence of an attorney and the weak claim. I seem to be one of many thousands of people who received court docs today judging by the quality of the summons. I’ve been doing research and this seems very easy to defeat. I’m wondering whether or not I should even bother to research how to defeat this when there might be an attorney willing to accept $250 to do it for me.

Last payment on the card was March 19th, 2011. I was served by someone in a $200 car on March 26th, 2015. The lawyer lives 300 miles away. The summons is very sketchy looking.

ANSWER: I don’t know who sued you and who their lawyers are. The debt buyer industry has been empowered over the last 2-3 years for a whole host of reasons. Yes, they may simply be interested in obtaining a default judgment. On the other hand, I have had many debt buyers – the likes of Midland Funding, Portfolio Recovery Associates, and many others up put a fight, even for very low balances. Their attorneys are in court with huge dockets all set for the same day: it is unlikely they would be coming to court for your case only. Plus, if this is a lawsuit in the Justice of the Peace court system, then the Texas Rules of Civil Procedure are severely relaxed, making it much easier to obtain a judgment.

You seem to be a terrific negotiator, considering your online bidding efforts here. Any lawyer that makes an appearance for you in an answer is on the hook for the entire case, not just the answer. An attorney who values their law license and their reputation will not get hired for the limited purpose of filing an answer and then asking the court to withdraw from your case. (I may be wrong, of course.)

If you fail to answer the lawsuit, or if you appear – pro se or through an attorney – and lose the case, the judgment will likely be significantly higher than $1,500.00, including interest, fees, court costs and attorney fees. The damage to your credit report, as well as the risk of post-judgment collection would be reasons for you to hire an experienced attorney.

 

Collection Case Dismissed For Lack Of Prosecution

QUESTION: I had a debit collection case that was dismissed for Lack of Prosecution.

The case was dismissed for Lack of Prosecution. I had filed a motion to reinstate the case and the judge said he wasn’t going to reinstate. so the  debt was sold to another collection agency. This was the 4 or 5 law firm that has come after me. What can I do to get this off my credit report? The debit type is a private student loan and this loan is NOT a FFELP.

ANSWER: There are two different issues here: the matter of the lawsuit seems to have been resolved if the case was dismissed. I understand that you have concerns that another debt buyer will sue you for it again. That is possible, although unlikely.

On the credit reporting side, you are encouraged to send off a written dispute letter to the credit bureaus and to everyone who ever tried to collect this debt. You should list all of the reasons why you dispute the negative information on your credit report. The fact that you were sued (and that the lawsuit was dismissed for lack of prosecution) does not qualify as a good reason to remove the debt from your credit reports.

If you dispute the debt with the present collector (and every collector beforehand) then they are prohibited by federal law from communicating information about the debt to yet another 3rd party. All of your disputes should be handled in writing, sent by certified mail, return receipt requested.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Debts From Deceased Relatives

QUESTION: My husband and I were separated for nearly a year. Am I responsible for his electric bill ? He passed away.  He was way behind in all bills. I have bills of my own showing where I lived.

ANSWER: A collection agency or creditor may want to assert that the debt is “community debt” which means that it belongs to both you and your late husband. The burden will be on you to show that you two were separated and that you did not benefit from some of his expenses – – like the electric bill at an address where you never resided.

You should be aware that the debt collection industry preying on the heirs of deceased people can be extremely harassing and abusive. They frequently play on people’s sense of grief and guilt. All of your husband’s creditors should take up their claims in probate court, and NOT by harassing you.

I strongly recommend that you check your credit bureau reports to confirm that his debts are not listed on your social security number. You can obtain a free copy of your credit bureau report at www.AnnualCreditReport.com.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Getting Sued By A Pay Day Lender

QUESTION: I have multiple online payday loans out since 2012 can they sue me?

I tried to work out arrangements with them but they wouldn’t settle what I could afford and refuse to give me an address to mail payments to them can I be in legal trouble?

ANSWER:  Theoretically, they can sue you. Generally, however, the payday loan collection industry is notorious for its illegal debt collection tactics. I recommend you consult with a consumer rights attorney, not just to review the terms of the payday loans, but also to determine if your rights have been violated (as well as your credit reporting rights.) 

Many consumer rights attorneys do not charge their clients up front, because many of the consumer rights statutes allow them to collect fees from the bad guys.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

Responsibility For Estate Debts

QUESTION: What is my legal responsibility to pay remaining debts for my deceased ex father-in-law if he named me beneficiary on 401k?

He lived in Illinois and I live in Texas. He apparently owed money to a bank in Illinois and they want me to turn over any monies received to them.

ANSWER: Please be careful about paying deceased people’s debt. There are a lot of abusive debt collectors taking advantage of the fact someone has died as justification to squeeze money out of the heirs, estate executors, etc. If Illinois law is similar to Texas law, you might want to consult with a consumer rights attorney about illegal debt collection tactics. Most consumer rights attorneys will handle cases against abusive debt collectors without charging for their time up front.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.