Legal Question in Credit and Debt Law in Florida

Threatened with Lawsuit after signing up with Credit Couselor

CA one-income family were struggling to pay our credit card payments for ~$35K in debt.Can't claim bankruptcy because spouse is ''sponsored'' perm. resident.Although we didn't use them except for emergencies,with most payments on time,over minimum, and never late more than 2-5 days (maybe 2x per year total),our APR from all CC companies kept going up.Our minimums were $700 2 yrs ago, climbed to over $900.We signed up with a credit counselor in 11/05.First offer requires 70% lump payment(on $6K) in 2 months, or 25% lump w/monthly payments that are 3x what we were paying (and over the total estimate for all plan payments), or legal action. Counseling contract states that settlements can't be finalized until $ in savings account, but according to savings/payment plan, we only have $200 saved after all the fees were taken.Contract states that the savings/payment plan is based on their 'best estimate' but estimated pay-off for this company was 30%, yet offer letter from counselor states, in their experience with this company, this ''may be the best offer''.

1-Do we have legal recourse against the FL counselor other than ending contract?

2-We don't own house/car etc., how much can be garnished from wages

3-Any alternatives appreciated!


Asked on 3/07/06, 4:52 pm

1 Answer from Attorneys
Samira Ghazal Ghazal & Gomez, P. A.

Re: Threatened with Lawsuit after signing up with Credit Couselor

My experience with clients using credit counselors is that they are a scam. That is what my clients always say. In reality, I think because you are out of state there are few alternatives to get your money back. You can file a complaint with the Federal Trade Commission [FTC]. You can also file a complaint with the State of Florida. I can't promise anything, but I do not believe they are going to sue you. If they do, please contact my office to discuss.

Since you can't file for BK, please visit my web page for free educational literature on credit and how to recover it.

Samira Ghazal

For the Firm

305.860.1221

www.FLORIDACREDITLAWYER.com

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Answered on 3/07/06, 9:06 pm


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