Being sued for debt used to be uncommon. The lender tried to collect on the debt and eventually turned it over to a collection agency who also tried to collect on the debt. If the debt was not paid it was eventually ended up on your credit report as an uncollected debt. In many cases, it disappeared after seven years. But that is changing, because the economy has made things more difficult for everyone, including credit card companies.
It is becoming more common for individuals to be sued for outstanding debt that has been ignored. This is something that you want to avoid at all cost. Even though it is difficult to face up to your debt, ignoring it is far worse. It is not easy to talk to your lenders when you owe them money that you do not have, but not talking to them at all can ever lead to being sued.
Being sued can lead to a judgment and possibly wage garnishment. A judgment will most likely stay on your credit record for 10 years. With people doing everything they can to keep their jobs a wage garnishment is the last thing you want your employer to have to deal with. Some employers will not tolerate them at all. In most cases, these discrepancies are avoidable.
Talk to your lender. You are not the first person to have trouble paying their bills and you will not be the last. Especially now, lenders have programs for people that are going through a financial hardship. But you will never know what these options are if you do not call the lender.
Being sued for debt is a reality these days. Call your lender should be your first course of action. Credit counseling or debt settlement may be the route you end up going if your lender is not able to help you. If you are able to make a minimum payment, credit counseling can have you debt free in about 5 years in most cases.
If you have a lot of debt or debt that is long past due, you will probably want to opt for debt settlement. This is the quickest way to get out of debt – usually in 3 years or less, but this method will not be kind to your credit. Many people who use this option already have a lot of negative credit and get their accounts settled is their first step in the debt elimination process.