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Sam Calvert


You have an outstanding bill. Or you have a bunch of outstanding bills. But you don’t have enough money to pay, and the creditor has turned it over to collection. You ask to set up a payment plan, but the collector refuses.

What happens next? Generally, after a several months of collection calls and letters, you get a letter from an attorney that says something like “We are ABC Lawyers. We have been hired by Discover Card to collect an account you owe them. They tell us you owe $5,315.00. If we do not hear from you within 30 days we will assume that this is valid.” This letter is sometimes called the mini-Miranda letter (like the Miranda warning in police shows (You do not have to say anything…). If you have a genuine dispute with the debt, now is the time to write and dispute the debt. A phone call probably won’t do the trick.

But if the debt is legitimate, the next thing is that someone will knock on your door and say “You’ve been served.” This is the summons and complaint, and you have twenty days after the date of service to send a formal response to the law firm. If you don’t do, you will be in “default” and the creditor will be able to have the court enter a judgment against you.

What can the creditor do then? Well, they can serve a garnishment on your employer and take one-fourth of your take-home paycheck (with a threshold of $413). Or they can seize your bank account and you will have to show the court that the funds in the account are exempt. This can go on and on, until the debt is paid.

However, if you file bankruptcy the collections of ordinary debts must stop! In some cases we can get back any money you have lost in the prior 90 days.

And the bankruptcy will generally discharge the debt, meaning that the creditor can no longer try to take your money.

If you are in financial trouble, or just want to discuss your options, feel free to call me to discuss your options. You can reach me at: (320) -252 4473.

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