Debts Below $7,000

How to Handle Debt Collectors on Debts Below $7,000.

This article covers debts less than $7,000.  If you have a debt larger than $7,000, please call us at The Fullman Firm at 877-227-2872, or email us at

For debts below $7,000, this article will cover what to do if you either:

  1. Have a debt that has not become a lawsuit yet,
  2. Are being sued in a new lawsuit now, or
  3. Are experiencing a wage garnishment.

Debt That Has Not Become A Lawsuit Yet

If you have a debt that has not become a lawsuit yet, then time may be on your side.  Any threats the debt collector may make about garnishing your wages, or putting a lien on your house would first require that they sue you and win the case, which takes time, and which means you will see it coming.  So don’t worry about that right now.  We recommend you negotiate directly with the debt collector or law firm that is collecting on the debt. If you can afford a lump sum offer then a debt buyer (not the original creditor) will often settle for less than 40% of the current amount of the debt.  Original creditors will often settle for less the 60%.  Get the best deal you can.  Try to do even better than these percentages.  If you need a payment plan, you may end up paying a little more.

Received A New Lawsuit?

If you have received a Summons and Complaint packet of documents, then you are being sued in a new lawsuit.  If you are not sure, you can see what a summons looks like at

You have 30 days from the date the Summons was delivered to file a general denial with the court.  Do not be misled by any other dates.  Again, the important date to remember is 30 days from the date the Summons was delivered.  You may want to try to work out a settlement with the creditor during those 30 days.  A settlement agreement with the creditor means you do not have to file paperwork with the court, even if the settlement will take time to payoff.

If you believe the debt is fraudulent or caused by identity theft, you may also choose to file a general denial with the court and fight the case. You can see what a General Denial looks like at

Wage Garnishment

If you are experiencing a wage garnishment, that means that you have already been sued and you have already lost the lawsuit.  In that case the first thing you need to do is get the wage garnishment reduced or possibly even stopped, then you can negotiate with the creditor without being under so much pressure.  A Claim of Exemption is a set of forms you file with the sheriff’s office, the same sheriff’s office that is handling your wage garnishment.  You must file your claim of exemption for wage garnishment within 10 days of learning of the wage garnishment.
You will need:
Claim of Exemption Form (WG-006)

Financial Statement (WG-007)

Employee Instructions (WG-003)

Finally, remember, there is no such thing as debtor’s prison.  You cannot be put in jail for not paying a consumer debt.  Any debt collector who says otherwise is lying and possibly a fraudster and you should stop talking to them.