You get a knock on the door. When you answer, it is someone standing there holding a large stack of paper. You are being served with a lawsuit.
Now what? First, let’s talk about why you are getting served this lawsuit. Perhaps you are not paying on a debt you owe or haven’t fulfilled a contractual obligation.
An individual or company either files a complaint or hires an attorney to do so. As stated in a legal dictionary, a complaint is any form of legal document that sets out the facts and legal reasons the that filing party or parties believes are sufficient to support a claim again the party or parties against whom the claim is brought that entitles to a remedy.
Once you have been served with the lawsuit, you have 20 days to respond. A response is done in the form of a document called an answer that is filed with the court. If you do not respond to the lawsuit, a default judgment can be entered against you. Once the judgment is issued, the creditor can attempt to garnish your wages or your bank account, and put a lien on your home or other assets.
To avoid the default judgment it is important to file your answer on time. After discussing your lawsuit with an experienced attorney, you may even consider filing bankruptcy to discharge the debt. Filing bankruptcy will stop the lawsuit in its tracks.
However, if bankruptcy is not the right option for you, then there are other solutions. The attorney can negotiate a settlement on the debt. Offering a one-time payment settlement amount can sometimes save you up to 50 percent. If you do not have a large sum of money lying around ready to pay off that debt, the attorney can perhaps negotiate monthly payments on the debt.
Once the lawsuit has been settled, the creditor will then file a voluntary notice of dismissal. The notice of voluntary dismissal will stop the lawsuit from proceeding.
So when someone knocks on your door with a lawsuit, seek the advice of a professional to consider your options.