If you fail to make credit payments on time, your credit card goes into default, and the credit card issuer may sue you for the balance owed. In Florida, credit card companies and debtors may enter arbitration--a process in which both sides negotiate an agreement to settle the debt. Arbitrators are subject to laws set out in the Florida Arbitration Code; in most cases, arbitration is binding, so it is important to negotiate a settlement you can afford.
Statute of Limitations
Florida law places a statute of limitations on credit card debt of four years from the time of default. Creditors may not use the court system to collect debts after this time period has elapsed, including petitioning the court to compel a debtor to enter arbitration regarding the debt.
Vacating Arbitration
Florida law allows you to vacate an arbitration agreement only if you were coerced into an agreement by corruption or fraud. For example, if you agreed to arbitrate your credit card debt because the creditor made threats he is not legally allowed to carry out, you can ask a court to vacate the claim. You only have legal standing to vacate the claim if you participate in the arbitration hearing; if you do not attend the hearing you are bound by the terms of arbitration that were drafted in your absence.
Compulsory Arbitration
Most credit card debt arbitration is voluntary. However, if a debtor refuses to enter arbitration, the creditor can petition the court to compel the debtor to enter it. The court may compel the debtor to enter arbitration if it believes there is no substantial objection. The debtor may request a hearing to present his reasons for not entering arbitration.
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