How to Eliminate a Credit Card Debt to Avoid Going to Court

A substantial number of credit card holders have defaulted on the credit card accounts. According to creditcards.com and the National Foundation for Credit Counseling, in the 2009 Financial Literacy Survey, approximately 15 percent of adults in the United States make late credit card payments. That's about 34 million people. When you make payments late you will receive phone calls and letters from your credit card company. If the delinquent payments are not resolved, in a timely manner, you could wind up in court fighting a lawsuit or judgment. There are ways to avoid going to court.

Instructions

1

Review the writ of summons. When a credit card company is going to take you to court, it's done so as a last resort, and you will receive a writ of summons in the mail. This document will state something to the effect of, "you are summoned to appear for trial at the date listed above, along with the time and location listed" When you receive this notice you can call the creditor and make satisfactory pay arrangements, instead of going to court, unless you plan on attending court because you have a legitimate defense. Creditors are usually lenient when it comes to making arrangements for payment.

2

Make sure the payment arrangement you agree to is satisfactory. You should not agree to payment arrangements that you cannot afford to meet. The arrangements should not put unjust stress or strain on your budget. You can also request that the creditor send you written confirmation of your payment arrangements.

3

Organize your other creditors. List all of your credit card balances in a prioritized list. If you have not made any payments in three or four months, you may want to prioritize your list based on the date last paid. If you have an account that has not had a payment in five months and another that has not had a payment in three months, the account with no payment in five months should go to the top of your list. This account becomes a top priority. The longer your credit card accounts go without payment the more likely it is that a creditor will start legal action, which requires your attendance in court.

4

Call your credit card accounts and make arrangements. All accounts with a top priority listing should be called first. Let the creditors know you will start making monthly payments. Once again this should not stress your budget. You should also look for credit card accounts with small balances, such as $500 or less. If you get extra cash to pay them off, do so. Wiping out a debt gives you a feeling of accomplishment.

5

Pay consistently. Start making your payments on a regular basis, month after month. Don't skip any payments and when your financial situation gets better, increase your payments. Eventually your credit score will improve. This procedure will keep you away from the litigation process. You will be able to eliminate credit debt and avoid going to court. Use any extra money such as bonuses, incentive, overtime and tax refunds to pay down your debt.