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Advice for how to respond to court summons for credit card debt?
When I was about 16, I became an authorized user under my grandmother's credit card. She only used the card for a few months and then moved out of the country. I continued using her card and only pay off the minimum amount each month, so of course interest started piling up. It got to the point where I kept spending and could not pay it off. Eventually, I stopped paying and started receiving phone calls and letters about the debt. However, I called the bank and asked them to take my name off. The original debt was about $1,000 and a few years later, its almost $4,000. Today, someone delivered a court letter under my grandmother's name to appear in court. My mom said I should call the collector and asked them to work out a plan for me to pay back the debt. Do you think it's possible if I asked them to take out the interests collected over the years and just have me pay what I owned without the interest? Do I have to hire a lawyer for that or do you think I should just pay the $4000? I have money saved for college, but this is stressing me out and I think I will just use it to pay this off. If I pay it off, does my grandmother still have to appear in court? Or will I have to appear in court even if I pay it off? I was young and dumb for spending more than I could pay back.
- kswck2Lv 71 month ago
The right thing to do is to pay off the debt as You are the one that spent that money. And stop using the card.
- 28AKOLv 52 months ago
You need to pay the card off cause you acquired the debt. I can tell you now debt collector isn't going to agree to take interest off. But they probably will offer to settle debt for less (half the amount you owe) why would you run the card up and not pay? you knew if was your grandmother card and you were an authorized user. You probably can be charged cause your grandmother didn't authorize you to use card once she left the country. How you didn't have money to pay on card or card off at $1000 if you have money saved for college?? pay it back
- Anonymous2 months ago
I worked collections for a few months 30+ years ago. Nobody got sued who had paid in the last 3-6 months.
We only sued people who had full time jobs that we could garnish. But, I think if the person showed up in court they could work out a deal to pay without their paycheck being garnished but this time, it was binding in that if you missed a payment, they had court approval to garnish your wages.
And once that starts it does not stop until the bill is paid in full.
I have heard about collection agencies settling debts for a lump sum at a discount but we did not do that. We had people who would pay their entire debt in full years later because they had to in order to be able to buy a house.
But the majority we took monthly payments from them. Without suing.
For you, I think its too late for any deal other than a binding one with court approval other than pay in full. You can ask to settle for something less in a lump sum payment and they may or may not do it.
But if they do, you would owe taxes on what you saved.
For example if they settled for $2800, you would owe taxes on $1200 that you gained from the settlement.
I am not real familiar with authorized users and I think they were different way back when. I always thought the authorized user had no legal liability. Only the real owner did. But then I heard that AUs do show up on your credit so I don't know for sure anymore.
If you can settle before court, that's best. they can tell the court nevermind.
But it cost them to file suit and serve papers and that is added to what is owed.
I had a few people who refused to pay, did not show up for court and months later get sued and their take home pay is reduced by 35% or so. We took 25% of your pretax earnings. I had a handful call me after that started and wanted to pay $200 a month that I offered them way back when. It was too late for that.
If its only in your grandmothers name you may not have any legal liability. But, they usually don't sue without someone having a full time job.
- parsnipiannaLv 72 months ago
The subpoena is to only your grandmother, correct? Your name is not on it? If so, do NOTHING, except stop using the card. Only your grandmother has been called to appear in court, and when she does not, she will simply lose the case, (which she would anyway), and the creditor can try to collect the debt from her. The court does nothing towards collecting it. They aren't going to chase her down for it out of the country.
IF, however, there is real estate in her name,the creditor can put a lien on it and the debt plus all the interest will have to be paid when the property is sold.