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Preparing for legal action taken by creditors

While creditors would much rather work out a payment plan, it is possible for a Kentucky resident to be taken to court for nonpayment of a debt. Creditors typically sue when a debtor fails to make a good faith effort to pay the debt. Therefore, it may be possible to avoid a lawsuit by contacting a creditor and making arrangements to get current on a loan.

The first step in the legal process of suing over debt is to send a complaint and summons. The complaint outlines the amount that a debtor owes while the summons indicates when to appear in court and provide a defense against the complaint. It is usually a good idea to answer the complaint as it may still be possible to work out a payment plan or another favorable resolution to the case.

Before the case can continue, the debt collector must provide verification of the debt in writing while creditors must attach a copy of the account to the complaint. Failure to do so may result in a case being dismissed. It may also be possible to defend against a claim of an unpaid debt by arguing that the statute of limitations to collect has passed.

Individuals who are struggling to repay their debts may wish to file for bankruptcy. Those who are eligible for Chapter 7 bankruptcy may have their debts discharged within weeks while paying little or nothing to creditors. An attorney may be able to help an individual determine if they are eligible to file for liquidation bankruptcy.

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