- Not all law firms specializing in debt collection defense offer the same services. Many serve only as the legal arm for debt settlement.
- Attorneys offer an objective perspective and can assist with any option you choose, be it paying the debt in full, debt settlement, or bankruptcy.
- Partnering with a law firm offers you protection against illegal debt collection efforts, and ensures the calls and harassment will stop as well.
High debt balances can leave you wondering how you will manage to keep up with current payments. Making minimum payments on credit card debt can cost thousands of dollars in interest each year and take decades to repay.
If you face financial hardship and need relief from high debt balances, it might be time to partner with a lawfirm that specializes in debt collection defense. Attorneys offer valuable benefits not available through other channels. A few of the advantages include the following:
An Objective Partner: An attorney specializing in debt collection defense has the tools to assist with every aspect of the process. You can receive advice on debt repayment, strategically negotiate a settlement of your debt balances, or walk you through the bankruptcy process depending on your specific circumstances.
Legal counsel is part of the package: Some law firms pose as debt attorneys, but are really credit settlement companies in disguise, that will not defend you in the event of legal action from a creditor. Hiring an attorney up front will not guarantee that you will not get sued. However, your attorney will work to minimize that risk. In the event of litigation, you will have immediate legal representation.
A professional strategist in your corner: Attorneys understand the law and will focus on minimizing your risk of litigation. They understand state laws that can impact creditor negotiation, know when to contact your creditors, and how to negotiate a deal.
For example, if you reside in a state where wage garnishment is possible, the propensity to be sued for the debt is much higher. The converse would be true if you try and settle the debt yourself unsuccessfully. You could get sued and need to retain counsel to appear and answer the suit or face a default judgment. If the court rules in the creditor’s favor, you could be liable for the full amount of the debt plus interest, penalties, the legal fees of the creditor, in addition to your own legal expenses.
Avoid default judgments: Creditors may attempt to get a default judgment, even if you do not legally owe the debt. An unanswered lawsuit will typically result in a judgment in the creditor’s favor, legally obligating you to repay the money. The debt may be past the statute of limitations, or it may not be yours. However, with a judgment, the creditor can force repayment through wage garnishment or seizing your bank account.
An attorney will automatically answer every lawsuit, eliminating unnecessary default judgments that could render you liable for a previously un-owed debt.
Stop collection calls: Creditors can ignore the power of attorney presented by a debt settlement company. They can refuse to work with credit counselors who want to negotiate lower interest rates and waived fees. But they cannot disregard a cease and desist order from an attorney.
Protect your rights: The average person has few resources to protect themselves against creditors who know the law and can manipulate the system in their favor. Debt collection defense attorneys can guide you through the complex rules of debt collection, allowing you to spot illegal activities on the part of a debt collection agency. When litigation defense is part of the service, your attorney can also handle any litigation for matters related to unlawful debt collection services. Sometimes a law firm can leverage an FDCPA violation to get the creditor or collector to avoid litigation and accept a deeper settlement or forgiveness of the entire debt.
There are many advantages to working with an attorney that specializes in debt collection defense. Doing so will give you access to professional legal guidance as you navigate the complex world of debt collection and seek to minimize the amount you must pay out of pocket to become debt-free.
What kind of attorney specializes in helping with debt matters?
Legal services often include specialists in debt collection defense, FDCPA (Fair Debt Collection Practices Act), and bankruptcy.
How do legal firms settle a debt?
Debt collection attorneys have in-depth knowledge of collection laws, have relationships with major creditors, and the skill to settle an unsecured debt for lower amounts.
How much can I expect to pay if I hire an attorney to settle my debt?
Creditors that accept debt settlements will typically agree to a repayment between 30 and 80% of the original debt balance. The law firm will charge a fee based on a percentage of the amount saved or the amount of the enrolled debt balance, hourly work performed, or a percentage of the amount saved.