If you're being sued over an unpaid debt, you may be unsure about what to do next. Is it better to try settling for a lesser amount or litigate in court to fight your case? The truth is: it depends. Every case is different, so talking with a legal professional is essential to better understand your situation.
An experienced attorney can analyze the details of your case in-depth, recommend the next best steps, and may be able to dismiss the case entirely or reduce the debt amount.
Before we dive in, keep in mind that it's important to be realistic. While there are options and tools to navigate debt, there is no magic trick to getting out of debt fast.
Debt settlement is when the party in debt and the creditor/debt collector negotiate a way to pay off the amount owed. In this process, the lawsuit does not go to court. The goal of the settlement is to reach an agreement in which the party in debt does not have to pay the full amount owed. When people are sued over unpaid debt, they often panic, thinking they’ll need to pay more than their original balance (court fees, service fees, legal fees, interest, etc.). Over the past 30+ years, Borell Law has covered countless cases in Florida where a client has come in stressed about how to get rid of debt and left relieved after settling for a lesser amount.
A settlement allows the party in debt to reduce the amount they owe, avoid bankruptcy, and positively impact their credit score in the long run. However, consulting with an experienced debt relief attorney to see if this is the best option is always advisable.
In litigation, the party being sued (defendant) and the petitioner take the lawsuit to court where both parties can present their side of the case. Unlike a settlement, litigation gives the party being sued a chance to fight and win their case. Unlike the straightforward nature of a debt settlement, litigation usually occurs when there is a more complex issue at hand. Because of the complexities involved, litigation can become an expensive and elongated process that can last months or even years, where legal fees and court costs can pile up quickly. Nevertheless, in most instances, litigation often involves big amounts of money on the line, and the better the case you have, the more likely you’ll be to consider litigation.
Long story short, debt settlement and litigation offer different paths toward the same goal: eliminating debt. Understanding the differences between these two paths is critical to helping people figure out how to get out of debt and make an informed decision about addressing their financial challenges. If you need guidance on your unpaid debt, call 1-800-983-1480 to find out your best options.
