Most of the population consists of those who measure each and every penny coming in or going out. If that part of population spends more than its earning, debts rise to huge levels, especially when considering interest rates. Then, while the mountain of debts is further heightening, there comes a court summons. Debt and court summons in some ways go hand in hand.
How to Answer a Court Summons?
The worst thing one can do is not reply. The debt collection agency involved in collecting debt wants people to behave indifferently, because that strengthens there case. In case someone doesn’t reply, or doesn’t attend court hearing in two times, is surely inviting trouble. One should understand that there is only one way of escaping a severe judgment, and that’s by presenting one’s side of view.
In first hearing, if one doesn’t attend, another summons is sent, which is to be replied in person in the second hearing. Debt and court summons are synonymous, and there are three or four way outs of it.
Methods of Recovery
The first one is wage garnishment. In it, some portion of the wage is deducted by the employer every month, and that is paid by the employer to the debt collection agency. Generally, 15-20% of the wage is deducted until the debt is covered, or paid by other means. It can be maximum 25%, and in extreme cases up to 50%.
The second option is asset seizure. In this, people from the debt collection agency personally visit the debt holder, and push him or her in to paying off their assets. In this case, there is a use of physical power at times. It depends on the assets held by the debt holder.
The third option is settlement, in which the lender may prefer taking a hit and may decrease the amount owed, or give some more time. It is based on amicable settlement, and is generally suited to both the parties. They both get an immediate solution at times.
Lastly, the fourth option is a loss for the lender. It means that he has to forego the loan amount because the debt holder can’t pay either through wage garnishment, or through assets, as he does not hold any assets. It is the extreme case. Though lender loses debt, the debt holder has a huge negative impact on their credit report.
The first way to answer court summons is to appear, and provide one’s side of view, and then proceed further.