First settlement letter from CA

[Forthebirds]

Hello,

Got a call from a CA a couple of weeks ago for my Citibank card ($2k balance). I believe the last payment was made in September. The CA who called asked about my plan for the debt. I stated that I had retained an attorney and will be filing Ch 7. The CA already had the atty info on file and apparently called him but didn't like that it was his cell phone. They asked for the office phone number which I didn't have at the time. They keep calling and I should probably answer and give the office #. I hate talking to them and don't want to say anything I shouldn't.

The letter that arrived soon after the phone call offered to settle for 40% of the balance. I'm not settling obviously, but do I need to respond? Send a letter to cease contact? I am so nervous that I'll be sued. Planning to file in the next couple months, I hope.

Thanks.

[bcohen]

If you will be able to file within the next 2-3 months, I would just go ahead and send the cease-and-desist letter. The peace and quiet is well worth the risk.

Assuming that the collection agency decides to file a lawsuit, it will take several weeks to get the complaint filed and have you served. Then it's another 30 days for you to respond. You should file an answer to the suit shortly before the deadline (i.e. 3 to 7 days before) and that will buy you another month. Answer their requests for discovery (being sure to object to questions which they don't have the right to ask, such as your employer info and bank account information) and serve them with your own discovery requests. By the time it goes to a motion for summary judgment, a good 3 months have gone by, and you've filed for bankruptcy, which stops the case dead in its tracks!

[Forthebirds]

What would be the risk of sending the letter? What happens if I don't do anything? They only call once a week. I'm hoping they don't take action since I have retained a lawyer and will be filing.

[LadyInTheRed]

Saying you are going to file BK usually will not stop a creditor from suing. It's hard to know whether sending a cease and desist letter will cause them to file suit sooner. If you are going to file BK in the next couple of months, there is little risk if you do nothing. It is unlikely they will sue you and get a judgement before you file BK. But, it isn't the end of the world if they do. The judgement will be worthless once you file BK. If they file a lawsuit soon enough to give them time to get a judgement and perfect liens against your property before you file BK, you can buy yourself time by responding the the lawsuit as bcohen suggests.