I received a call during my radio show yesterday from an older gentleman who wanted to know if he should allow the local sheriff to serve him or not. He is approximately $7,000 in debt, but he knows he is being served on part of that debt, around $4,000.
“I could avoid the server,” he suggested.
“I don’t think that’s been working out all that well for you so far,” I responded.
He wanted to know about filing for bankruptcy. I suggested that he first have a session with Consumer Credit Counseling Services. The CCCS of Greater Atlanta (he is located in Atlanta) is one of only 9 bankruptcy counseling organizations accredited by the US Bankruptcy Courts. It seems to me that while he might get served (and would have to answer that), bankruptcy isn’t the answer when you have a relatively small debt.
Here’s more information I received last night from another listener, a bankruptcy attorney:
Ilyce, I didn’t have time to call in today, but I wanted to comment on one call. The gentlemen asking about law suit on debts and bankruptcy.
I am a bankruptcy attorney in Atlanta. I do my own consultations and hearings so I deal with 20 to 25 people a week like this guy. You said correctly to try CCCS if possible. On a $4000 debt, they may be able to work out a payment plan for him opposed to filing bankruptcy.
The other tactic I take in State Court if they can afford it is to file an answer in the case and then see if I can settle it before it gets to the judgment stage. I recomend that people do not do this pro se (without an attorney) if they can avoid it. The collection attorneys have it down on how to railroad these through on pro se defendant by summary judgment.
Usually you can settle these debts for .15 to .30 on the dollar if they have some funds available. The Debt Collectors are out of control. The are running over FDCPA without a thought. People who I talk to are getting called twenty to thirty times a day without regard to any provisions of the FDCPA. They are calling their neighbors and family members. It is driving an incredible number of people to me for bankruptcy protection just to get away from the calling and threats.
If you’re looking for CCCS of Greater Atlanta (and they’re one of the best of a very good bunch of credit counselors), find them online at www.cccsatl.org.
June 23, 2008.
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