Debt Settlement
Being sued over a credit card is frightening and very common. It is also, more often than people assume, negotiable — and a default judgment is the one outcome you can still avoid.
Attorney Stacy Geiger began her legal career in 2005 at one of Florida's largest collection law firms, conducting thousands of depositions and negotiating a great many settlements. In 2009 she moved to one of the largest debt settlement firms in the country and spent years defending consumers being sued over credit card debt, protecting them from creditor harassment and defending garnishments.
That is an unusual amount of time on both sides of the same table, and it is why we can generally tell you early what a creditor will actually accept.
What debt settlement is
Debt settlement — also called debt resolution or debt negotiation — is a negotiated agreement with an unsecured creditor to accept less than the full balance, either as a lump sum or as a defined series of payments. It applies to unsecured debt: credit cards, medical bills, personal loans, deficiency balances. It does not apply to secured debt such as a mortgage or car loan, where the collateral changes the analysis entirely.
If you have already been served
Do not ignore it. A summons has a response deadline, and missing it produces a default judgment — which in Florida can lead to wage garnishment, bank account levy and a judgment lien. A great many collection suits are filed on purchased debt where the plaintiff cannot readily produce the chain of assignment or the original agreement. That is a real defense, and it is only available if you respond in time.
Getting the terms in writing
Every settlement must be documented before you pay a cent. The agreement should state the amount, the schedule, that the debt is resolved in full on completion, and how the account will be reported. Verbal assurances from a collector are worth nothing when the account is sold on six months later.
What settlement does and does not fix
We tell clients this plainly. Settling resolves the balance and stops the collection activity. It does not erase the earlier delinquency from your credit report — negative history from the original creditor may remain for its normal reporting period even after the account shows as resolved. Forgiven debt over $600 may also be reported to the IRS as income on a Form 1099-C, which is worth planning for rather than discovering in April.
How we help
- Negotiating settlements with creditors and debt buyers
- Defending credit card and consumer collection lawsuits
- Responding to a summons before a default judgment is entered
- Challenging standing where debt has been sold and resold
- Defending wage garnishment and bank levies
- Asserting exemptions available to Florida residents
- Fair Debt Collection Practices Act issues and creditor harassment
- Written settlement agreements that hold up
Common questions
I have been served with a lawsuit. How long do I have?
The summons states the deadline, and it is short. Do not let it pass — a default judgment is far harder to undo than a case is to defend. Call us as soon as you are served.
Will settling hurt my credit?
The delinquency that preceded it already has. Settling generally reports as settled rather than paid in full, which is not ideal, but it is better than an open charged-off balance and considerably better than a judgment.
Can my wages be garnished in Florida?
Only after a judgment, and Florida provides a strong head-of-family exemption that protects the wages of many workers entirely. Asserting the exemption is not automatic — it has to be claimed, correctly and on time.
Is settling better than bankruptcy?
It depends on how much you owe, what assets you have, and your income. Settlement suits people with a manageable number of accounts and access to funds. Where the debt is overwhelming, bankruptcy may be the more honest answer, and we will say so rather than sell you something that will not work.
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Learn moreTalk to a lawyer who will actually pick up the phone.
Tell us what happened. We will tell you where you stand, what it is likely to cost, and what the next step is — before you commit to anything.