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socialworker · Jul 12, 2008, 07:14 AM

I recently received a letter from a mediation firm stating that I was being sued by Capital One for a little over $3000. I disregarded the letter but yesterday when I came home from work, I had a card from the sheriff's department in my door. I was not actually served with any papers and I did not contact the sheriff's department. Since I can't think of any other reason the sheriff would come and see me, I contacted the mediation firm who sent me the original letter that I was being sued. They said that they would assist in mediation for a fee of $400. I asked if I could not contact the plantiff's attorney directly and the guy told me he wouldn't suggest it. He said that if they had already pursued legal proceedings that I probably couldn't settle out of court or without their services. He said that I could probably settle for $2500. I wasn't sure exactly how much the original debt was but I couldn't imagine that I it was that much. I found a bill last night and I think the original debt is not over $1500 because that was the credit limit on the card. I realize that there is interest and attorney fees but the amount he quoted me is over double the amount. I cannot afford to send the mediation firm $400 plus pay $2500 in a settlement. I asked the man at the mediation firm how he got my information and he said that the court summons was public record. I was skeptical but I thought that sounded legit.

I got scared and actually wrote the check to the mediation firm and got ready to send it. Something told me not to so I have waited. Today, I was doing research on the internet and learned that, actually, I might be able to settle out of court. I have tried to contact Capital One (when I enter my credit card number I am connected to an attorney's message system). I, hesitantly, left my name and number but no one has contacted me back. Of course, I called yesterday afternoon (Friday) about 4:30 pm central time.

I have about $2300 in savings. I guess I am wondering if I can settle out of court for the original amount of the debt. I would save $400 by mediating myself and not using the firm. I am really scared and want to resolve the matter. I agree that I owe the debt. I understand that I may have to pay taxes on the amount of debt they write off. I am a social worker and do contract work on the side. I usually have a lot of write offs because of this and can probably compensate for the additional income in debt write offs with that.

I have been very ill in the past 10 years and have a lot of student loans, medical bills, etc. I am finally in a position to start making things right in my life and just want to do that right thing with the least amount of money.

Due to my past problems, credit scores are my greatest worry at this point, but I was told at one time that if you settle a debt it may remain on your credit report as unpaid because you didn't pay the original amount of the debt. Is that true? I would like, at some point in my life, to actually have a good credit rating and I am trying to resolve my past debt. Thanks for any help that anyone could give me. Also, I live in Alabama if that helps.

farmgirlmo · Jul 12, 2008, 07:40 AM

Originally Posted by socialworker

I asked the man at the mediation firm how he got my information and he said that the court summons was public record. I was skeptical but I thought that sounded legit.

It is true that those are public record. Lawyers/mediation places have people who scan public records daily so they can send offers to

Today, I was doing research on the internet and learned that, actually, I might be able to settle out of court.

It is still possible to settle out of court

I have about $2300 in savings. I guess I am wondering if I can settle out of court for the original amount of the debt.

Very good chance

Due to my past problems, credit scores are my greatest worry at this point, but I was told at one time that if you settle a debt it may remain on your credit report as unpaid b/c you didn't pay the original amount of the debt. Is that true?

No, it is not true. It will say "settled legally for less than full amount" or something to that affect. I've seen incidents where it doesn't mention settlement.

I would like, at some point in my life, to actually have a good credit rating and I am trying to resolve my past debt. Thanks for any help that anyone could give me. Also, I live in Alabama if that helps.

The Statutes of Limitations in Alabama is 3 years on open accounts(credit cards), when was the last payment date, last use of card, etc? If SOL has expired, you can use that as your defense.

Settling before a judgment is issued is always the best bet. You don't want a judgment on your credit report

farmgirlmo · Jul 12, 2008, 07:51 AM

Found this information

Section 6-2-16
Sufficiency of partial payment or written promise to remove bar.
No act, promise or acknowledgment is sufficient to remove the bar to an action created by the provisions of this chapter, nor is such evidence of a new and continuing contract, except a partial payment, made upon the contract by the party sought to be charged before the bar is complete or an unconditional promise in writing signed by the party to be charged thereby.

Section 6-2-37
Commencement of actions - Three years.
The following must be commenced within three years:

(1) Actions to recover money due by open or unliquidated account, the time to be computed from the date of the last item of the account or from the time when, by contract or usage, the account is due; and

(2) Proceedings in any court of this state to disbar any attorney authorized to practice law in this state.

Section 6-2-34
Commencement of actions - Six years.
The following must be commenced within six years:

(1) Actions for any trespass to person or liberty, such as false imprisonment or assault and battery;

(2) Actions for any trespass to real or personal property;

(3) Actions for the detention or conversion of personal property;

(4) Actions founded on promises in writing not under seal;

(5) Actions for the recovery of money upon a loan, upon a stated or liquidated account or for arrears of rent due upon a parol demise;

(6) Actions for the use and occupation of land;

(7) Motions and other actions against the sureties of any sheriff, coroner, constable, or any public officer and actions against the sureties of executors, administrators, or guardians for any nonfeasance, misfeasance, or malfeasance, whatsoever, of their principal, the time to be computed from the act done or omitted by their principal which fixes the liability of the surety;

(8) Motions and other actions against attorneys-at-law for failure to pay over money of their clients or for neglect or omission of duty; and

(9) Actions upon any simple contract or speciality not specifically enumerated in this section.

Code Of Alabama

socialworker · Jul 12, 2008, 11:30 AM

Thank you so much. The original debt is not more than 3 years old because I got the card when I first moved into my house and that was less than 3 years ago. I realize that you can try and get out of debt that way but I agree that I owe it and will make a good faith effort to pay.

I will try and call the attorney back on Monday and see if I can first settle for the original amount of the debt ($1500.00). If not, I will ask for an itemized list of the amount they are suing for and make a written statement asking for settlement amount. I have read that judges look favorably on trying to settle out of court. I also will ask for a written statement that if settlement is made, that all court proceedings will be cancelled. Thanks again.

farmgirlmo · Jul 12, 2008, 05:15 PM

Originally Posted by socialworker

Thank you so much. The original debt is not more than 3 years old b/c I got the card when I first moved into my house and that was less than 3 years ago. I realize that you can try and get out of debt that way but I agree that I owe it and will make a good faith effort to pay.

I will try and call the attorney back on Monday and see if I can first settle for the original amount of the debt ($1500.00). If not, I will ask for an itemized list of the amount they are suing for and make a written statement asking for settlement amount. I have read that judges look favorably on trying to settle out of court. I also will ask for a written statement that if settlement is made, that all court proceedings will be cancelled. Thanks again.

I had a friend sued from a CC company. She paid her lawyer like $500 bucks and he got them to settle for less than half what they were wanting.

I'd try negotiating, but if it looks like it is going to court and they won't settle, try to be prepared to pay that day. If they win, ask the judge if you PIF today if he will not order a judgment. A judgment will kill your credit.