Credit card companies usually will negotiate even after assigning your account to an attorney, according to the MSN Money website. Illinois Legal Aid reports that the assignment of an attorney to the debt is the start of the lawsuit process. But MSN Money reports that there is still time to resolve the issue before a lawsuit is filed -- or even after.
Time Frame
MSN Money reports that credit card companies generally will close your account after six months of missed payments, list it as charged off and assign it to a debt collection agency or attorney. A collection agency -- either internal or external -- is usually the first step and then an attorney is hired to pursue a possible lawsuit.
Considerations
The New York Times reported in 2010 that some attorneys for credit card companies are willing to negotiate or settle accounts in courtroom hallways just hours before a trial is set to begin. However, the Times also reports that these last-minute settlements often heavily favor the credit card company.
Features
The SmartMoney websites reports that credit card companies and debt collectors are often willing to settle credit card debts for 20 to 75 percent of the balance. However, the threat of legal action through an attorney can provide additional leverage for the card company.
Effects
Settling with the attorney before a trial can save you money. Illinois Legal Aid reports that if the case reaches trial, you are sure to lose if the attorney for the credit card company proves you owe the debt. The judge would then award the credit card company a judgment for the full amount of the debt plus legal fees.
Prevention/Solution
Pay your credit card bill on time to avoid having it assigned to an attorney. Or contact your card company for help when you first start falling behind. The card company may drop your interest rate and allow you to make smaller payments for a period of time while you restructure your finances.
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