The New Normal: Recovery After Credit Card Disaster

Whether you have fallen behind in your payments, are being sued, have filed or are planning to file for bankruptcy, there is hope and help to repair your credit.

Some simple and effective steps exist to help you through this tough time. While it can be embarrassing, it’s a topic that needs addressing.  There are people who can help you get turned back around.

First, know that you are not alone. The economic ups and downs have affected many people. Disposable incomes are down and savings are evaporating. Credit is scarce, and the same people who once received regular credit offers are having trouble paying their bills. Some who can’t pay these bills are being sued by these companies, and some people are filing for bankruptcy. In fact, it is estimated that since 2003 more than 1.5 million people have filed for bankruptcy.

You have legal rights, and by knowing them, you can do a lot by getting bill collectors off your back and get on track for a fresh financial start. Debtors who know how to assert themselves my end up gaining more time to pay, have late fees dropped, settle debts for less than the full amount, and get some – not always and not always all – negative marks removed from their credit record.

Keep an eye on the mail and respond to any and all lawsuits that are served on you by any credit card companies. You must answer them in a timely manner. Do not ignore.

You can do it. Gather as much information as you can from reading and researching. If you feel this is too overwhelming, there are also financial consultants, attorneys and paralegals who can help you each and every step of the way. They have the tools and the experience to know how to research and help you.

Believe it or not, nobody’s credit is beyond repair. Even if you believe you have been through the worst and the most devastating of financial times, it’s possible that my may one day get credit again. As long as you have settled your financial troubles and they are mostly behind you, you will probably qualify for limited types of credit relatively quickly. Usually within two years of resolution you can open a major credit card or loan. Also, some creditors are willing to extend credit to people who have turned their credit around.

If you are being sued by a credit card company: 

• Don’t ignore any lawsuits that are served on you. Read the paperwork. Typically a response is required within 30 days of your summons date.
• Calendar any date you see on the paperwork to show up in court.

• Make sure you were served in the right manner. The right manner would be having a process server or Marshall knock on the front door, ask you your personal identifying information (your name, age etc.) and leave you with a packet of papers saying you are served. Within this stack of paperwork you will have dates to calendar and a lawsuit to answer. You will have 30 days from the date you were served to answer the Complaint.

The wrong service would include not receiving any of the stated paperwork or just receiving part of them.

• Make sure all the paperwork there is there for you to answer. Within this packet of paperwork you will find a Proof of Service, Complaint, Summons and a blank Response, as well as a date for your court hearing.

• From the moment you know you are in financial trouble, make sure you keep a detailed account of everything, every telephone call to and from your creditors, any offers from them, any offers from you trying to settle the debt.
• Write a detailed summary that explains why you fell behind in your payments.

Remember, this is just some basic advice on where you can get started on your path to financial solvency. Your financial situation is likely more complex and will require more information than is given here. You should seek professional advice from an attorney, paralegal or financial planner to determine your personal liability as well as your options for moving forward.

Karen Corbelli is a Redding-based legal document assistant armed with more than 20 years of legal experience. She can be reached at 515-5081 or

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