What To Do When a Credit Card Company Sues You
You have legal options even after a lawsuit is filed
When a credit card company sues you, you are not powerless. You have the right to respond to the lawsuit, and the court will not automatically side with the creditor just because they filed first. The most important thing is to respond within the deadline — usually 20 to 30 days depending on your state — because ignoring the lawsuit almost guarantees a judgment against you. Even if you cannot pay the full amount, responding keeps your options open and forces the credit card company to prove their case.
A lawsuit means the credit card company is asking a court to order you to pay what you owe. If they win, they get a judgment, which is a court order saying you legally owe the money. That judgment can then be used to garnish your wages, freeze your bank account, or place a lien on your property — depending on your state's laws and what you own. But you can challenge the lawsuit, negotiate a settlement, or ask the court for time to pay.
Key Takeaways
- You must respond to the lawsuit within the deadline stated in your court papers, or the credit card company will win by default without proving anything.
- Your response does not have to be fancy or written by a lawyer — you can file it yourself, though many courts offer free help or low-cost legal aid.
- Common defenses include the debt being too old to sue over, the credit card company not proving they own the debt, or errors in the amount they claim you owe.
- Even after a judgment, you can still negotiate a settlement, set up a payment plan, or challenge the judgment if new facts come to light.
- Some states protect certain income and assets from being taken, so knowing your state's rules matters before the creditor tries to collect.
Understanding the court papers you received
The papers you got in the mail or from a process server are called a summons and complaint. The summons tells you that you are being sued and gives you a deadline to respond — read it carefully because missing that date is the single biggest mistake people make. The complaint is the credit card company's story: they say you opened an account, charged money, and stopped paying. They will list the amount they claim you owe, when they say you stopped paying, and what they want the court to order you to do (usually pay the debt plus interest and court costs).
The summons will also tell you where and when you need to respond. Some courts want you to file your response at the courthouse; others want it mailed to the credit card company's lawyer. The deadline is not a suggestion — if you miss it, the court can enter a default judgment against you, meaning you lose without ever getting to tell your side of the story. If you are not sure what the papers mean or when you need to respond, call the courthouse listed on the summons and ask. Most courthouses have staff who can explain the process for free.
How to respond to the lawsuit
Your response is called an answer, and it does not have to be complicated. You can write it yourself on plain paper or use a template from your state or local court website — many courts post free forms online. Your answer should do two things: first, respond to each claim in the complaint by saying whether you agree, disagree, or do not have enough information to know; second, list any defenses you have.
A defense is a legal reason why the credit card company should not win, even if you did owe money at some point. Common defenses include the debt being time-barred (too old to sue over under your state's statute of limitations), the credit card company not proving they own the debt, errors in the amount they claim, or the account being fraudulent. You do not have to prove your defense right now — you just have to list it. The court will decide later whether it holds up.
File your answer before the deadline by bringing it to the courthouse or mailing it, depending on what the summons says. Keep a copy for yourself and consider sending a copy to the credit card company's lawyer as well (the summons should list their contact information). If you cannot afford the court filing fee, ask the courthouse about a fee waiver — most courts will waive or reduce fees for people with low income.
When to look for free or low-cost legal help
You do not need a lawyer to respond to a credit card lawsuit, but free or low-cost help is available if you want it. Legal aid organizations in your area offer free services to people who cannot afford a lawyer. To find one, search "legal aid" plus your state name, or call 211 and ask for legal aid referrals. Some bar associations also run free legal clinics where lawyers volunteer time to answer questions.
If you do hire a lawyer, they can negotiate with the credit card company's lawyer, file motions to dismiss the case, or represent you at trial. However, many people handle their own response successfully, especially if the lawsuit is straightforward. The key is responding on time — whether you do it yourself or with help.
Defenses that can stop or delay the lawsuit
The statute of limitations is one of the strongest defenses. Every state sets a time limit on how long a credit card company can sue you after you stop paying — usually between three and six years, depending on your state. If the lawsuit is filed after that deadline has passed, you can ask the court to dismiss the case. Check your state's rules or ask a legal aid lawyer what the deadline is in your situation.
Another defense is that the credit card company cannot prove they own the debt or have the right to collect it. Credit card debt is often sold to collection agencies or other companies, and sometimes the paperwork does not follow the debt properly. If the company suing you cannot show they own the debt or got the right to collect it, the court may dismiss the case.
You can also challenge the amount they claim you owe. Ask them to prove every charge and every fee. If they cannot show the original account agreement or proof of the charges, that is a problem for them. Errors in the amount — like charging interest twice or adding fees that were not in your contract — are also defenses worth raising.
What happens after you respond
After you file your answer, the case moves into a phase called discovery, where both sides exchange documents and information. The credit card company will send you copies of the account agreement, statements, and proof that you owe the money. You can ask them for documents too. This is your chance to see whether they actually have proof of what they claim.
Many cases settle during discovery because one side realizes they have a weak case. If the credit card company cannot prove you owe the money, they may offer to drop the case or settle for less than they are asking. If you want to negotiate, you can contact their lawyer and make an offer. Even a small settlement is often better than losing at trial and having a judgment against you.
If the case does not settle, it will go to trial. At trial, the credit card company has to prove their case to a judge (or sometimes a jury). You get to present your defenses and challenge their evidence. If you win, the case is dismissed and there is no judgment. If you lose, the judge will enter a judgment against you for the amount owed plus court costs.
Protecting your income and assets after a judgment
If the credit card company wins and gets a judgment, they can try to collect by garnishing your wages, freezing your bank account, or placing a lien on property you own. However, most states protect certain income and assets from being taken. For example, many states protect a portion of your wages from garnishment, and some protect your primary home or car up to a certain value.
The rules vary widely by state, so learning what is protected in your situation is important. You can ask a legal aid lawyer, call your state's attorney general's office, or search your state's court website for information on debt collection and asset protection. Some states also require the credit card company to go through additional steps before they can garnish wages or freeze accounts, which gives you time to respond or negotiate.
Even after a judgment, you can still negotiate a payment plan with the credit card company. Many creditors would rather get paid over time than spend money trying to garnish wages or seize assets. If your situation changes — you lose your job, have a medical emergency, or your income drops — you can ask the court to modify the judgment or ask the creditor to work with you on a new arrangement.
Frequently Asked Questions
What happens if I ignore the lawsuit?
If you do not respond by the deadline, the credit card company wins automatically. The court will enter a default judgment against you, and the creditor can then garnish your wages, freeze your bank account, or place a lien on your property without having to prove anything. Responding is always better than ignoring the lawsuit, even if you think you owe the money.
Can I settle the debt before trial?
Yes. At any point before or during the trial, you can negotiate a settlement with the credit card company's lawyer. Many creditors will accept less than the full amount owed to avoid the cost and uncertainty of trial. Any settlement should be put in writing and should say the case will be dismissed once you pay.
Do I need a lawyer to respond to the lawsuit?
No, you can respond yourself using a template from your court's website or by writing a simple answer on plain paper. However, free legal aid is available in most areas, and a lawyer can help you find defenses you might miss. Call 211 or search "legal aid" plus your state name to find free help.
How long do I have to respond?
The deadline is usually 20 to 30 days from the date you were served with the summons, but it varies by state and court. Check the summons carefully — it will tell you the exact date you must respond by. If you are not sure, call the courthouse and ask.
What if the credit card company cannot prove I owe the debt?
If they cannot show the original account agreement, statements, or proof of the charges, you can challenge the lawsuit. During discovery, you can demand they produce this evidence. If they cannot, you can ask the court to dismiss the case or rule in your favor at trial.