Falling behind on credit card payments is frustrating and frightening. Credit card companies can sue debtors to recover unsecured credit card debt. Fortunately, debtors can do things to minimize the risk of litigation and laws to protect debtors against unscrupulous collection practices.
Lawsuit Frequency
The number of debt collection lawsuits is increasing, according to the Debt Collection Answers website. The site reports that "12,000 debt collection suits are expected to be filed in 2010, up from 9.300 in 2009 and 4.400 in 2007." Still, Superior Debt Relief Services and other debt management services continue to maintain that most creditors would rather settle a debt by accepting less than the full amount owed than take on the added expense of going to court. The best way to avoid a lawsuit is to simply keep talking to your creditors and trying to make good on the debt.
Wage Garnishment
Wage garnishment is a possibility if a credit card company does sue a debtor. In order for wage garnishment to occur, however, the credit card company must file a lawsuit and win a judgment in that suit. Creditors can not garnish wages without a court order.
Time Frame
In the U.S., time limits are placed on how long a credit card company or other creditor may sue a debtor. The statute of limitations varies from state to state and can range from two to 15 years, according to BCS Alliance. Debtors must be very careful, however, when speaking to debt collectors after the statute of limitations has run out. In some states, admitting to owing the debt starts the statute of limitations clock all over again.
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