Expert: Michael Brotherton - 11/5/2008

Question
Hello, I have been served and given 20 days to respond.I did owe $5500, but now with all the fees it is $6500. They are seeking a judgment against me and requesting employment records from the state. I did open this account in CA but now live in OK. The debt is valid. I do owe it. I have not been employed since 1994. The only asset in my/husband's name is a 92 Honda Civic worth about $1700. I have joint checking accounts with my husband. His paycheck in automatically deposited. Is this account going to be seized? I plan on filing a response laying out my budget showing that I do not have the money to pay back this debt. Should I attempt a payment plan or is it too late? I would not be able to pay very much at all. I literally have $148 to my name right now. I am not able to work as I care/educate five children full time and I have back problems that prevent me from standing or sitting for any length of time. Would any of this info mean anything to the creditors? Do I need to take myself off of our joint checking accounts? or does that not do any good? Our house is in my husband's name only and another car with little equity. Here is the best plan I can come up with on my own: ask the court for a reduced interest rate and ask for a hardship stay(does the interest keep accumulating?). Also, is it too late to see if CCCS can help. I didn't contact them before because I am not even meeting my necessities every month. If you have any advice I would appreciate it very much. Thank you.

Answer
Sorry for the delay, i get a lot of questions and try to keep up but time is limited.

First, You need to respond to the courts but do not give them budget information yet. You want to attempt to get a hearing by disputing the validity of the debt first. I know you say you owe the money but they need to prove their case first. Your dispute should be a defense not an admission of fault or plea for hardship. They don't really care about your hardship.

Your answer should be short and to the point. You may dispute the balance of the account and ask that they verify their accounting method and how they arrived at their figures. You may admit to what may be referred to as count one in their complaint that you do in fact owe the creditor money but on their claims of the amount owed you must dispute it.

Once they set a hearing then they can confirm their accounting then you may ask for concessions due to hardship and ask for a stay of execution of their judgement. You are what may be considered insolvent. You have no assets and have minimal income.

I would for the time being have your husband remove you from the checking account or open a new account in his name only. They could potentially freeze the account or attempt to seize it.

If you think you can afford minimal payments write the attorney a letter after you file your answer and make a proposal for a payment plan on a reduced amount. If they do not agree to your proposal then go to court and ask the judge for reduced interest and minimal payments based on your proposed payment amount. The ball is actually in your court and they cannot touch you or get any money unless you volunteer to pay them. You cant pay what you don't have. Do not be afraid or intimidated by the attorney or their reps. You are virtually untouchable. Relax, fear not...