Chloe Meltzer | December 02, 2022
Summary: Are you being sued by a debt collector for an old debt? Find out if you need a debt settlement attorney in Houston, Texas.
Being in debt is never a wanted situation for anyone, but if you find yourself in debt, you need to know how to deal with a debt settlement. Although you can hire an attorney, this can be expensive.
Rather than immediately jump to this, educate yourself and see if you can represent yourself. Here are a few things you should know about debt collection in Texas.
You must realize that debt collection is not illegal. Specifically, a debt collector is attempting to collect a debt for a creditor who believes you owe them money. It is completely legal for a debt collector to contact you regarding your debt. Despite this, you do have the right to be treated with respect.
The Fair Debt Collection Practices Act (FDCPA) protects consumers from unfair practices by debt collectors. For example, debt collectors may not harass or oppress you. They also cannot lie to you and try to coerce you into anything. They may also not contact anyone other than your spouse and let them know about your debt, call you at work, or at odd times such as before 8:00 a.m. or after 9:00 p.m.
It is good to note that debt collectors are only allowed to call you at work if they know that they are allowed to do so. Additionally, they cannot call if you ask them to stop. This can be done by sending a letter to the collector asking them to stop.
Specifically in Texas, a debt collector cannot threaten to garnish your wages because it is not legal in the state. Texas also doesn't allow a creditor to force you to sell your home even if they have obtained a judgment lien against it.
Debt settlement companies typically claim that they can convince a creditor to settle your debt for less. Although this might be true, you might even be able to do this on your own. Debt settlement attorneys are a lawyer who is willing to work with you, help you negotiate, and then defend you if you get sued.
Should you be current on your payments, then you most likely will not be able to organize a settlement unless you stop. Debt settlement companies will tell you to stop making payments to the creditors and begin making payments to them. These payments should cover their fee and future payments of your debt for a lump sum.
The problem with this tactic is that it will hurt your credit. The next step will be to offer a lump sum fee to settle the debt.
Most debt settlement companies do not explain the risks that are associated with hiring them. For example, your debt gets larger when you work with a settlement attorney because you will pay more in interest, and also pay a fee to the company.
Additionally, it is a bit of a risk. Your creditors may not want to settle. Because you will have to let your credit score drop to attempt for the settlement. If the creditors do not accept a settlement, then they might end up filing a lawsuit and it would be for nothing.
Debt settlement company fees are always high. Even if you are working with a debt settlement company and they are not a lawyer, you are going to be paying at least a percentage of your settlement (typically around 25%). They often will charge you a starting fee and a monthly fee as well. Eventually, you will come to find that it is a better option to settle your debt on your own.
In some cases, you might feel that you cannot negotiate properly for yourself. Skilled attorneys may be able to give you good legal advice and help you make a good decision. They can also help to represent you if the creditor ends up filing a lawsuit. Additionally, if the creditor has violated any of your consumer rights, then a debt settlement attorney can help you to proceed and defend you.
The attorney will be able to go through everything with you and help you decide what the best option is for you. In some cases, it might be to file for bankruptcy.
Although all attorneys must be licensed and are legally supposed to work according to ethical standards, not all lawyers do. Some debt settlement companies hire lawyers to con you into signing with them. It makes the settlement company appear more legitimate, but it will be bad for you in the long run.
The best option is to hire a lawyer that you can meet with in person. Although this might be more expensive, it will allow you to know who you are working with. They should offer a free consultation or a consultation that goes towards your overall bill should you decide to work with them.
Finally, another red flag that the lawyer you are dealing with is a debt settlement company in disguise, is if they want you to pay for negotiations but won't support you if you are sued. This is a huge red flag, and you should probably look elsewhere for a different attorney. Regardless, attempting to settle your debt on your own is usually the best option, and you should always avoid debt settlement companies.
SoloSuit makes it easy to respond to a debt collection lawsuit.
How it works: SoloSuit is a step-by-step web-app that asks you all the necessary questions to complete your answer. Upon completion, you can either print the completed forms and mail in the hard copies to the courts or you can pay SoloSuit to file it for you and to have an attorney review the document.
"First time getting sued by a debt collector and I was searching all over YouTube and ran across SoloSuit, so I decided to buy their services with their attorney reviewed documentation which cost extra but it was well worth it! SoloSuit sent the documentation to the parties and to the court which saved me time from having to go to court and in a few weeks the case got dismissed!" – James
Here's a list of guides for other states.
Being sued by a different debt collector? We're making guides on how to beat each one.
Is your credit card company suing you? Learn how you can beat each one.
Need more info on statutes of limitations? Read our 50-state guide.
Need help managing your finances? Check out these resources.