Legal Question in Credit and Debt Law in Massachusetts
I live in Massachusetts and had a credit card that was charged off by the bank in 2005 with a balance of $1,500. It was picked up by a law firm on behalf of a collections agency who contacted me saying the balance was $4,600 in 2006. A summons was served to me and in order to avoid going to court and make payment arrangements they told me to sign the summons and return it to them and I would be all set as long as I stuck to the payment arrangement. I had no idea that my signature was actually so they could enter a judgement against me for payment. To date I have paid about $2,600 to them and the balance owed has only been decreased by $500 to $4,117. They are charging me 1% interest monthly on the $4,600 monthly and it's quite disconcerting now because I have been laid off from my job since last year and am in a dilemma now to continue making payments which I have done up until March 2010. Can you let me know what options I have in terms of not defaulting on the judgment and getting this settled or paid off!
I am in no position to retain a lawyer unless it's free or charitable since I'm unemployed :-)
I spoke with them last week just to see what they would settle for and the guy asked me where I would be getting the money from to settle and that it would probably be in the vicinity of $3,600. Is there any way to get them to cease charging me the high interest they are charging until I pay this debt off.
Many thanks in advance for your response.
Many thanks in advance for your response
2 Answers from Attorneys
Sorry to learn about your unemployment and collections problems. Even at this troubling stage, you may still have consumer legal rights. Whether you can get any relief at this stage (including a reduction or suspension of this high interest) depends on whether or not you can prove (document) that these debt collectors violated the law.
Debt collectors must follow all laws (federal and state laws) when collecting debts. A few of these laws which may assist you (you can read them on line) are Mass. Gen. Law Chapter 93A, the Fair Debt Collections Practices Act (FDCPA), the Fair Credit Reporting Act (FCRA), and many Massachusetts tort laws. You may wish to read the ones cited (The online commentary is readable).
This Office specializes in many consumer law violations. These laws can get you legal relief if you ultimately win in court. If after you've analyze these debt collectors' conduct and read the cites, you feel you want a free legal consultation, contact us. Good Luck!
The 12% interest rate is the statutory Massachusetts interest rate on judgments, the company isn't making it up. Unless you can show that your signature was mis-used in some way, you are likely stuck with the judgment. These law firms like to settle and they like to settle for lump sums. Even though they said $3600, they might accept much less if given in a lump sum. Also, if you just stop paying, they'll likely bring you to court in a procedure called "Supplementary Process" where you can tell the judge that you are unemployed and the judge will let you stop your payments for some period of time, but unfortunately the interest will continue to accrue. Finally, if you have other debts, it may be worthwhile to consider bankruptcy to wipe out this and most other debts. Good luck.
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