You owe a debt and have not paid it.  It may not be your fault, you may be in a tough financial position.  If this sounds like you, there are steps you can take and should consider protecting yourself from legal action and to stop the letters and phone calls.  If a debt collector or law firm  is threatening and harassing you to pay your debt, which you have ignored, they may consider filing a lawsuit against you.  The easiest way to delay or stop this from happening is to communicate with your creditors.   Unfortunately, debt collectors know that people often continue to ignore difficult situations until they are forced to act.  Even then, many people allow a creditor to obtain a default judgment after being sued, because they think they are out of options.  This tactic can be harmful and cause serious financial problems for you when you thought the end was in sight.

Not responding to a lawsuit will make things worse

If you’ve received a summons and complaint , it’s important not to ignore it! The creditor has sued you over your debt because they believe you owe them money and they want their money back as soon as possible. Your failure to respond or acknowledge the lawsuit could lead the court to rule against you without even listening to your side of the story.   Ignoring a summons and complaint might seem easy, but it will only make things worse. Depending on who you owe, ignoring the lawsuit may lead to having an outstanding judgment against you reported to the credit bureaus — which will result in further damage to your credit score.  A judgment will incur interest at a rate of 12% a year in Maryland, and subject you to wage garnishments, a lien on your house and even possible foreclosure on your home.

Why You Should Respond to a summons and complaint 

If you don’t file an answer, you won’t be allowed to tell the court that you think the debt is either unfair or not owed by you.  If this has happened to you, bankruptcy may be the only way out after you’ve waived  your chance to defend the debt. If you still think the lawsuit is unfair,  you need to act quickly and hire an attorney before it’s too late.  Even after you file an answer, you can still try to negotiate a debt settlement.  However, a debt collector has no legal obligation to accept or even discuss settlement once the case has been filed.  With that said, many attorneys can leverage certain federal rights to get the creditors to come to the table and talk settlement.

Bankruptcy and the Automatic Stay To Stop Collection Cases and Debt Collection Harassment

Even after a judgment has been issued against you, there are still debt relief options, including “the automatic stay.”  Filing for bankruptcy puts all collection efforts on hold and stops debt collectors from taking any action to collect on the debt, and all legal processes.  If you file the bankruptcy before a final judgment, that case will be stopped dead in its tracks and never proceed to a judgment against you.

How To Use the right legal strategy with the automatic stay

If creditors learn about your bankruptcy plan before you’ve filed the case, it could prove costly.  If debt collectors don’t know that you’re going to file a bankruptcy, then they might not even bother trying to obtain a judgment, or feel like they need to act so quickly before its too late for them.  Often, if you put a creditor on notice, you are tipping them off and they will be more aggressive with their debt collection efforts.  They will do so, to try take your assets before they are protected.