by Chris
(Philadelphia, PA, USA)

A debt collector has informed me that they are going to sue me in 60 days for the debt I owe ( $16,000 unsecured). Exactly what does this mean? Can they garnish any of my wages, can they place a lien on my home? etc. I just can not afford to pay now but plan on doing so as soon as I can. Thank you.

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Jul 19, 2010
Lawsuit threatened over unsecured debt
by: Mary

Thanks for submitting your debt collection question on our Q&A page.

If the debt collector does indeed sue you for the money you owe and if the debt collector wins the lawsuit, the court will award him a judgment against you. The amount of the judgment will equal however much money the judge gives the collector permission to collect from you.

Once the debt collector has been awarded the judgment, he may try to collect on the judgment by asking the court for permission to: 1. Take one or more of your nonexempt assets. These are assets that the law in your state says creditors and collectors can take in order to collect money from a consumer; and/or 2. Put a lien on one or more of your nonexempt assets. If there is a lien on one of your nonexempt, you will not be able to borrow against the asset, transfer it, or sell it without paying the amount of the lien first. Unfortunately, the law in Pennsylvania treats your home as a nonexempt asset, so it is subject to these collection actions. The good news however, is that your state prohibits wage garnishment, so the debt collector cannot take your wages in order to enforce a judgment against you.

Given that the debt collector told you that he did not intend to file against you for 60 days, he has given you an opportunity to try to avoid a lawsuit. Therefore, I suggest you that you meet immediately with a consumer bankruptcy attorney in your area. The attorney will evaluate the state of your finances and recommend your best course of action, which may or may not be filing for bankruptcy. Click here for a free consult with a bankruptcy attorney.

Please share what happens with your situation in the comments section for this question. We are very interested in hearing how this turns out for you, and your experience can help others who are struggling with debt collectors.

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