Legal Question in Credit and Debt Law in Texas

I was just served for $4,500 owed to American Express. At the time we couldn't pay the bill my husbands hours were cut and I had no job so we called and let Amex know immediately. The immediately closed our account and put us on a payment plan. When I asked if we could use the massive amount of points we had saved toward the balance they said it was too late because they shut off the card. My account was current at the time. We made the $590 payments for a few months but we just couldn't keep it up so I called again to renegotiate. They told me that if I couldn't pay the $590 then I would just have to wait for collections and that was the last I heard of it till this week more than 18 months later. I have also received a letter from the attorney that filed suit offering some sort of payment plan if I call them. I am a full time student, I have no job and no savings and I am the only person named in the suit. My husband has a job but has been in and out of the hospital for the past 2 years so his salary is sparse and he also has no savings. What should I respond and should I call the people to see if they will settle reasonably?

Asked on 2/22/14, 7:41 pm

1 Answer from Attorneys

Mark Dunn Mark D. Dunn

"Served"? Did a process server hand you a citation? Did you sign for certified mail?

I'm thinking it's possible that you weren't actually SERVED, but American Express wants you to think you were.

If you were in fact served with a lawsuit:

You should file an answer to the lawsuit. You may have a defense of limitations. You should probably go see a lawyer.

But American Express is probably entitled to a judgment.

You are probably "judgment proof." Most Texans are, even those who have good jobs and live in nice houses.

As for payment plans: the general rule is that you shouldn't let these people run your life, and you shouldn't feel threatened by them. Pay them when you can, as much as you can, and if it's only $40 per month, tough. That's what they get.

You don't have much to gain by talking to them on the phone. Stop doing that. If they call, tell them you want to handle everything by mail, and HANG UP. Stop talking to them on the phone.

I'll go ahead and say it again: STOP TALKING TO THEM ON THE PHONE.

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Answered on 2/28/14, 12:25 am

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