We may as well get the bad news out of the way first. If you owe money to a credit card company or any other creditor, they are legally entitled to take you to court to seek a judgement to make you repay that money. So a credit card company can sue you for debt, but it does not automatically follow that this is what they will do. What action they eventually take depends on many different factors, and if you do not leave it too late, there are things you can do yourself to prevent being sued for debt.
Taking someone to court is not something a credit card company will do without careful consideration. The bottom line is that they will do this if they believe that suing you is the course of action likely to give them the greatest chance of getting their money back. There is a cost to them in doing this, so they need to weigh up that cost against how much they are likely to gain. If they believe you really do not have the means to pay back the money it reduces the chances that they will sue you because being sued does not magically make you able to pay.
If you are sued and a court order is made against you, all that means is that the court look at your financial situation and decide what kind of terms are appropriate for the repayment of the money. They will order you to make payments of a certain amount, which should be based on what it is within your means to pay. So you are not going to be asked to come up with a pile of money you have not got.
Ideally of course you want to prevent things getting as far as this if you possibly can. Being sued for debt is what tends to happen if people do not engage with the credit card company and try to communicate honestly about their situation. When people try to ignore creditors as if the debt will somehow go away, that is when creditors are left to assume the worst about you and take action accordingly.
You need to be seen by the credit card company to be taking your situation seriously and trying to do something to enable you to repay what you owe them. You need to take action to get out of debt and the credit card company needs to know what you are doing so they are less likely to sue you. The best options open to you for getting rid of credit card debt are either debt management or debt settlement. I will explain the differences between these and when they should be used.
Debt management is when you use a professional company to set up a debt management plan for you. This is also known as debt consolidation because most people have debts to a few different credit card companies and other creditors and the plan consolidates all of these into a single payment. The company engages with the each credit card company you owe money to and works out new terms to pay back your debt. This results in lower charges and therefore lower payments for you. You just have to make one payment a month to the debt company, who then distribute it to the creditors.
To be eligible for a debt management plan your financial situation has to be such that you have a certain amount of regular income that enables you to afford the regular plan payments. If you have a large amount of debt and not much income, a debt management plan may not be an option, in which case you need to look at debt settlement.
With debt settlement you do not attempt to pay back the full debt, but get agreement to write off as much of it as possible. A debt settlement company will negotiate with each credit card company to seek a drastic reduction in the principle amount that you owe. A good settlement negotiator is likely to get agreement for you to only have to pay back less than half of the full amount.
If you do wish to look into debt management or settlement, it is sensible to be careful about the company you ask to help you. You may well have heard of some debt settlement companies in particular who charge large up front fees and then do not manage to reduce the debts in the way they have promised. Do not let this put you off the entire industry, as there are many very well established companies that have helped thousands of people to avoid being sued and to get rid of their debts.
Applying to debt companies is now a simple online procedure and you can apply to as many as you want in order to then compare what they propose. The best way to begin is to use recommendations to find a selection of established and reputable companies and start from there.
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