As an Orlando bankruptcy lawyer, one of the first things I advise my clients to do when they decide they are filing bankruptcy and hire me is to stop paying on their credit cards. Recently, though, before I could offer that advice, a client asked me: “What happens when I stop paying my credit cards?”
The short answer is, the collection process will begin. It usually goes something like this:
1. The original creditor will call you, your family, your place of employment, non-stop for about 60-90 days trying to get you to pay something over the phone and making all kinds of threats about how they are going to ruin you financially unless you pay them.
2. Once the initial creditor believes they cannot convince you to make a payment, usually after 90 or so days, they will sell your account to a third party collection agency. This collection agency will then proceed with the actions listed above.
3. Then, around 180 days from the time you stop making payments, you may hear from an attorney. This attorney will simply try to collect on the debt, following the same protocol in 1 and 2 above.
4. Finally, the attorney may file a lawsuit against you seeking a judgment that would allow the creditor to attempt to collect on the judgment. By the way, then, and only then, can your wages be garnished.
Kind of a long process until a judgment is obtained, right? Over 6 months from the time payments stopped being made if I added correctly. So why, as a bankruptcy lawyer, do I advise my clients to stop paying on credit cards when they hire me?
The reason is simple. The intent is for my client to have their bankruptcy filed long before that judgment is obtained. Therefore, no possible garnishment. With the money they have saved by not making payments to a those rude and obnoxious debt collectors, my clients are able to catch up on car payments or house payments for secured debt they want to keep through filing bankruptcy. Additionally, they can begin to build the safety net. This is a strategy I recommend as their Orlando bankruptcy lawyer, to help them in getting the most out of the fresh start filing bankruptcy can provide.
But what about those malicious debt collection agents? Here in Florida, we have some of the toughest laws in the country to protect consumers from the abuses collectors use regularly when attempting to get my clients to pay their credit card debts. Additionally, a Federal Law also restricts those abusive acts by third party collection agents in an attempt to collect on a debt. Why not sue your creditors to enforce your rights?
The debt collection process can be an intimidating experience, or an empowering one. If you know how it works and you know your rights, the empty threats the debt collectors hurl at you in a typical phone call from them will seem laughable, and more often than not, actionable.
Check out my Free eCourse to learn more about how an experienced bankruptcy lawyer can help successfully navigate you through the debt collection process and help you get a fresh start financially.
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- Make Use Of This Credit Card Debt Relief Plan To End Annoying Enquiries From Debt Collectors
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Tags: Bankruptcy, bankruptcy attorney, bankruptcy lawyer, credit card debt, filing bankruptcy, finance, financial, law, stop credit card payments, stop paying credit cards