Determining The Right Debt Collection Defense Strategy For You
When defending against debt collection, several questions need to be asked by the alleged debtor. First is whether the debt is legitimate and whether it was incurred by the defendant. Second is how long it has been since the last use or last payment, whichever is last.
The statute of limitations in Pennsylvania for a contractual debt is four years. That defense is commonly used where the debt has been transferred from the creditor to a collector. The next major question and perhaps the final question is whether the amount of the debt, if valid, could be negotiated to a lower figure and under what payment terms.
I am lawyer Michael E. Eisenberg. For more than 25 years, I have been helping debtors in Hatboro and throughout Pennsylvania reduce their debts and stop creditor harassment.
I will examine your situation to determine the best methods of debt collection defense. Depending on the debts involved, your assets, and your goals, I will use a variety of legal strategies, including debt workouts, strategic sales and bankruptcy to protect your assets and financial rights.
The Automatic Stay
One of the greatest benefits bankruptcy provides is the automatic stay. As soon as your bankruptcy petition is filed, creditors must cease all collection actions against you. That means your wages cannot be garnished, your property cannot be repossessed and your home cannot be foreclosed on while your bankruptcy is pending. This can be a great relief, especially for people who have been hounded by debt collectors on a daily basis. Creditors do have rights to seek permission to move forward with certain collection activities. Knowing rights and defenses can make a difference in the outcome.
Federal and state laws offer many exemptions that protect certain assets from loss during bankruptcy. An experienced bankruptcy attorney, like myself, can evaluate your assets and your debts, and create a plan that maximizes your exemptions and protects the vast majority of your assets.
Small Business And Personal Debt Workouts
If debt has become an issue, then the factors of the client, whether it is an individual, a couple or a small business, must be evaluated to determine if a work out plan, debt restructuring, is feasible and how to implement a plan. One of the advantages of this method of debt resolution is the avoidance of bankruptcy while still maintaining the ability to file bankruptcy if needed.
A full review of income, assets, debts and cash flow must be performed to determine the best course of action. This process can take a number of hours before creditor contact is made. Once creditor contact is made, the negotiations begin and any confirmations occur once deals are made.
Small-Business Sales And Purchases
One of the most important steps for a small-business owner is whether to sell or whether to purchase an existing business. Experienced counsel is important as this is often the only business owned by the seller and a large investment of funds for the purchaser.
The purchase must be evaluated in terms of the form of the business to be sold and how the purchaser will operate the business. Sole proprietorships are different from corporate ownership and asset sales/ purchase are different from a stock purchase. These decisions are above and beyond the usual due diligence performed when contemplating a purchase or sale. Whether the sale will be owner financed, cash or bank/institution financed are decisions to be made early in the process. Consult counsel early on and before anything, even a letter of intent, is signed.
Call To Schedule Your Free Consultation
For more information about debt collection defense, or to discuss the possibility of filing bankruptcy, contact my firm. We will sit down with you, review your case and go through your options in a free consultation. Call 267-722-8383 today to get started.