My advice isn't lawyerly. It isn't even bankerly, because I'm not a real banker. It isn't even advice.
But, speaking entirely without knowledge, and treating this as one would a hypothetical case, one can make the following general observations which are more or less common knowledge.
A rather sensible article on debt strategies is at
http://www.nolo.com/encyclopedia/articles/dc/essential.html
My only point of disagreement with it would be that utility companies can usually (in the UK at least) be messed about more or less indefinitely before they take any real action.
My own thrts would be:
1.Check the letter. Many things which pupport to be summons in fact are not. Only an actual writ from an court official is a summons. Letters from credit card companies aren't, but will often superficially resemble them. If your friend is in really dire financial straits, the strategy of "pay on receipt of writ" is the only possible one.
A summons to appear on Dec 27th sounds funny to me -- I'd be very surprised
if a court was sitting on that date for such a routine matter. I'd certainly reply and ask for a postponement, although things have been left rather late, and Yank courts may be more industrious than Brit ones. It doesn't really matter if your friend doesn't show up -- what, is she going to argue that she doesn't owe the money or something? A court is not the place to make excuses -- this should be done directly.
US Bankruptcy law is federal (the relevant Chapter for individuals is Ch. 7, IIRC), but regional courts often interpret the Federal Code differently. I have no knowledge of what Illinois is like for individuals, but it's quite debtor-friendly for corporates. Of course, bankruptcy is unlikely to be a real issue for your friend, unless there are other debts which are a problem -- I can't believe that it would be worth anyone's while to declare bankruptcy over $1200.
2. Assess the real situation. Obviously, if your friend can't afford to pay, some sort of judgement will be entered against her. This is not the worst thing on earth -- being unable to pay the rent is worse. Garniching wages is probably unlikely given that we're not talking about bankruptcy here -- my guess would
be that if the company continues to hear nothing from your friend, the bailiffs will call round and start taking
things. For this reason, now would be a good time to back up that thesis onto floppy disks (don't laugh, it's happened).
But the card company is unlikely to do this if it thinks there is an alternative -- strange to say, bankers have no real fetish for owning second hand stereo gear and musical instruments.
Definitely talk to the lender. Plead poverty. Work out some sort of rescheduling. $1200 is not a large sum to First Union (market cap. US$38bn), and they can only recover bailiff's fees charged, not their own admin costs. They're likely to accept any deal which offers a possibility of getting their money back. In
all probability, they will suggest dragging your friend's parents into the matter (the "Chinese gambit" in bankerspeak) -- she will have her own opinions on this.
3. Forget threats about credit ratings. As Doug, myself, etc have discussed on this list, there is no
such thing as a "screwed credit rating" any more in America, due to the rapacious pace of competition
among lenders -- your friend will have to pay a little more on her next credit card, that's all. (I'm assuming
she doesn't want to work on Wall Street or anything, for which a judgement
in the files can be irritating). In principle, it might even be possible to transfer the debt to a new credit card, although I very definitely would not want to recommend this.
20% interest on a card is not that bad by UK standards, but I would guess you could get a better deal in the US if you shopped around. $40 late fees seems very steep, and if you find yourself paying them regularly you should change card. In my experience, late fees are more or less optional if you can come up with a half- convincing story and have a pleasant but forceful manner (everyone should threaten to change their bank at least twice a year, and that is advice). But my experience might be different from yours as I am probably a more profitable customer at the moment.
cheers and remember that none of these general comments should be taken as advice of any sort. as my disclaimer says, the email fairies may have altered this message entirely at some point.
dd
Please respond to lbo-talk at lists.panix.com
To: lbo-talk at lists.panix.com cc: (bcc: DANIEL DAVIES) bcc: DANIEL DAVIES Subject: Re: req. a bit of free lawyerly advice.....
Thanks, I''ll fwd. this on. I wrote that request in a rush and the flippancy I meant in re bank/legal "scum" didnt come off, though come to think of it I'd probably stand by it as a generalization. Of course, I speak as someone who finds %20 rates and $40 late charges as usurious. (Do I have the wrong cards myself?) I've no idea what the IL laws are in re available creditor's "remedies"-- good tip. Best, Dan
At 11:04 PM 12/21/99 -0500, you wrote:
>In a message dated 99-12-21 18:37:06 EST, you write:
>
>Without venturing to offer legal advice (I don't even know what state your
>friend is in, which woiuld determine the governing law), one might surmise
------------------------------------------------------ Daniel F. Vukovich Dept. of English; The Unit for Criticism University of Illinois Urbana, IL ------------------------------------------------------
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