Best suggestion to solve an outstanding debt?
September 24, 2013 2:34 PM   Subscribe

Have a lawyer, but uncertain of services rendered so far. Tricky, complicated situation - more details inside!

Disclaimer: I know you're not my lawyer, you can't 100% guarantee the answer you give will be guaranteed to help or be the best solution, yada yada.

So, about two years ago, I discovered I owed a company a large amount of money ($35,000). The original lawyer representing me bowed out when said company refused to forfeit the $35,000 collection, and I tried fighting the company on my own without much success. The company eventually sent my bill to a debt collection firm (Javitch), who then threatened a lawsuit. This was much earlier this year. Frantically, I searched for and found a lawyer who had 100% positive reviews on (a lawyer rating website). At first, I was skeptical (was this too good to be true?), but I checked this lawyer out via a few other websites, and he seemed legit enough. So, I pulled the trigger, had him represent me, and try to clear things up to avoid me being sued. This lawyer was unable to get the specific information/circumstances leading up to the $35,000 bill (such as an itemized list) from both Javitch and from the original company, and basically ended up in a ping-pong war. My lawyer tried to negotiate the $35,000 down to $3,000, which, IMHO, I thought was a bit too low, but maybe going in lowball was better. Clearly, this did not go anywhere, and the lowest from the original $35,000 Javitch was willing to negotiate down to was $26,250. My lawyer was aware of the circumstances leading up to the $35,000 and why it was unfair to me, and tried explaining that to Javitch to no avail.

From that point on, my lawyer recommended that he just terminate representation of the case and that I lay low and wait until/if they sue me. As the original situation that eventually led to the $35,000 bill happened more than three years ago (the bill for $35,000 was issued in very late 2011), he said that he doubted they would sue me, and that the statue of limitations would most likely expire four years after the original incident. He said he did not want to waste any more of my money. However, I had a few doubts because: a) going in lowball is one thing, but he went in REALLY lowball; Javitch probably just laughed him away; b) I want peace of mind. This has been hanging over my head, and I want it resolved; and c) what if he has an agenda: knowing they probably will sue me (contrary to what he told me), and knowing he'd make money out of me?

I suggested we try and meet Javitch halfway by offering $13,000 as a final offer, and he said this was strongly against his advice, and that Javitch made it seem like the previous $26,250 offer was the best and final offer for the time being. He also said it was best to let 'sleeping dogs lie'. However, my school of thinking was that Javitch may take us more seriously if we offered $13,000, which seems more reasonable than the original $3,000 offered by my lawyer.

Another relatively minor thing that bothers me about my lawyer is that sometimes his grammar isn't 100% the best, and he can take a bit of time responding. He was the cheapest lawyer I could find, but the reviews really raved about him, so it was a difficult decision to make. I'm just afraid I'm going at this wrong, or it's just my worrying getting the best of me, and this is the correct/best solution. I'm just not sure if I should stick with him and/or find another lawyer, or to go ahead and offer the $13,000 as a final offer. Obviously, I don't expect any of you to make the decision or tell me what to do, but sharing everything with a neutral/outside party really helps, and would give me some perspective, especially with those of you experienced in debt cases/who have experienced fighting large amounts of debt. Any questions or clarification needed are welcome.

Thank you!
posted by dubious_dude to Law & Government (13 answers total) 2 users marked this as a favorite
going in lowball is one thing, but he went in REALLY lowball;

It's not really lowball. I have previously settled debts with creditors for 10 cents on the dollar. I would have expected him to offer 3, them to say 5, and the matter to have settled at $3.5K.

For a $35,000 debt you have tried to settle, I too would take the "fuck it, let them sue" tactical position because there's at least a 50/50 chance they won't, especially as they don't seem to be able to substantiate the debt.

In short, I think you're getting good advice and should follow it.
posted by DarlingBri at 2:51 PM on September 24, 2013 [6 favorites]

I'm a lawyer, but i can't advise you about the debt. I do know quite a bit about my colleagues, so I want to weigh in on what you're saying about your lawyer. Crazy as this sounds, your lawyer, by being reachable, giving you candid advice, by responding to your questions about a case that clearly isn't that potentially lucrative for him, has elevated himself over 90% of the vermin out there who call themselves attorneys. So be glad you have a straight shooter who is not screwing you and is actually working on your case. That is amazingly rare for middle-class consumer-level cases (big firm, bill fee attorneys are a different story, they have to be responsive to their demanding corporate clients).

Nobody here can really tell you whether your attorney's advice is solid. Generally, I would think it is a really bad move to offer so much money as a proposed settlement, so I'm inclined to think your attorney is right.

That being said, you seem to doubt his advice. Fine, hire a new attorney and see what they advise you to do. When attorney and client don't see eye to eye it's appropriate and expected for the client to move on.

But seriously, I'd think twice before moving on, because this attorney sounds solid. Don't worry about less than impeccable grammar; that's not unusual.
posted by jayder at 2:55 PM on September 24, 2013 [6 favorites]

This lawyer was unable to get the specific information/circumstances leading up to the $35,000 bill (such as an itemized list) from both Javitch and from the original company, and basically ended up in a ping-pong war.

This [substantiating the debt, not necessarily providing an itemized list] is something they'll have to do if they expect to win a lawsuit for the debt. They don't get to pinkie-swear that you owe them money.

If you're really concerned, find a different lawyer, go in for a consultation and get a second opinion, but I would highly recommend that you not go against the advice of a licensed attorney who is representing you here.

The whole reason you hired a lawyer in the first place is that you can't do this yourself . . . so it seems strange to toss that away now just because you don't have a good gut feeling about the advice.
posted by toomuchpete at 2:58 PM on September 24, 2013

In my decidedly non-expert opinion, your lawyer is right. They seem to be bluffing. If they can't substantiate the debt, they can't sue you over it. 10 cents on the dollar is a fair offer for debt settlement, too. I'd take his advice.
posted by zug at 3:13 PM on September 24, 2013 [2 favorites]

the statue of limitations would most likely expire four years after the original incident.

That bit surprises me. I thought that negotiating with the company (and acknowledging the debt) could reset this timer.

That said, I would either follow his advice or get another lawyer - it seems like a bad idea to unilaterally go against the advice of someone who certainly knows more about it than you do.
posted by jacalata at 3:15 PM on September 24, 2013

Data point. I have an acquaintance who is a lawyer who handled a lot of small-fry collections matters representing people being sued by credit card companies. That seemed like a weird way to make a living; "what can you do for these people?" I asked him.

He said he got many, many cases dismissed because the credit card company couldn't produce any actual proof of the debt. The contract just gets lost in the bowels of CitiBank, CapitalOne, etc., and the shit-heel attorney for the credit card company ends up dismissing the case.

So, knowing that, why would the attorney offer anything more than a pittance?
posted by jayder at 3:16 PM on September 24, 2013

Here is the logic behind that offer: The debt collection firm is likely to have purchased the $35K debt for $3,500 or less, so offering them $3K allows them to negotiate up a little and make a profit with very little time invested. Now they have to decide how much time they want to invest in a lawsuit vs the chances of them winning and being able to compel you to pay. They may take into account their evidence or lack thereof in making this decision.

Do not be surprised to see it on your credit report(s).
posted by soelo at 3:20 PM on September 24, 2013

(Never mind me - looks like talking about the debt can't reset the timer in California)
posted by jacalata at 3:22 PM on September 24, 2013

The assumption is that you're in debt because you're broke.

If you offer 13k, that shows a surprising level of assets for a debtor. If (and this is a huge if) they can validate the debt, why wouldn't they sue you for what you're worth now, and garnish your wages (which must be substantial enough for you to save the 13k to begin with).

Why would you put blood in the water when the statute of limitations is almost up?
posted by politikitty at 4:08 PM on September 24, 2013 [1 favorite]

If they can't prove the debt I think you lawyer did the right thing. IANAL I have worked at collecting debts for businesses before they head off to debt collection. They most likely paid a few cents in the dollar for the debt or they'd have paperwork.

I would recommend doing exactly what your attorney said, but if you really feel you have to up the offer do not do such a big jump, they will smell money on you. At the most I'd offer a grand or so more. Remember you can always go up again, you can't come back down. But seriously, listen to your attorney.
posted by wwax at 4:45 PM on September 24, 2013

Aha. Your previous question ( and the clarifying follow-up make this debt clearer. I still say fuck 'em - let them sue and go back to the lawyer if they do. I'd feel good about your chances of outliving the statute of limitations, though, and the bankruptcy option is always there the same way it was when you first asked about this.
posted by DarlingBri at 5:41 PM on September 24, 2013

Wow, thanks for all the answers! They really helped put my situation in perspective. Looks like my lawyer is one I should trust, then. I guess it's just the natural control freak in me - I like having control of everything and knowing what's happening. This situation, unfortunately, is out of my control and I hate not knowing what's next, but some of what you guys said was reassuring. Worst-case scenario, I get sued and will expect to pay back the full $35k. Best-case scenario, I end up owing nothing and the case becomes dismissed.

It just truly sucks having all this hanging over my head, having a hard time coping with it, and not knowing what to expect or anticipate any next moves. It's really eating at me, which is why I want this solved. Any ideas on how to cope with that?

Thanks again!
posted by dubious_dude at 9:07 PM on September 24, 2013

It just truly sucks having all this hanging over my head, having a hard time coping with it, and not knowing what to expect or anticipate any next moves. It's really eating at me, which is why I want this solved. Any ideas on how to cope with that?

Yeah. Dial down the angst. It's an unsecured debt; nobody is going to repossess your house or your car and there is no debtors prison in the US. The worst case scenario is that they sue you and win in court; you then go on a payment plan or tell them to go fuck themselves and declare bankruptcy. (27 is a great time to do that, by the way, because it gives you a good long while to recover your credit score before you super-need it for things like houses.) Accept either one of those as potential outcomes and there is nothing to be stressed about because you know what will happen if things develop that way.

In the best case scenario, they go away. I had a similar sized debt to a similarly stupid debtor and they eventually told me they were going to sue. Having long ago accepted the worst case scenario, I told them to go right ahead and do that if that was what they felt was in their best interests, but that I had no assets they could recover and was happy to declare bankruptcy in the face of any judgement so good luck with that. I never heard from them again.

You have the legal representation of a solid lawyer, you're not out in the wind on your own on this, and none of the least-optimal outcomes is catastrophic. I'd suggest you elect to be BORED by this rather than stressed, because nothing really bad is going to happen to you here.
posted by DarlingBri at 6:17 AM on September 25, 2013 [2 favorites]

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