Sued for Credit Card Debt: Disclose before SA? Forum

[Anonymous User]

My firm is doing a credit check for SA. I just got sued this month for credit card debt its only a couple thousands. I only stopped paying once law school started and planned to pay it off during the summer when I have some income. It has completely tanked my credit score. This is the only negative thing on my credit report.

I talked to Career Services and was told to write a letter to the firm to disclose the situation before the credit check and let them know it will be resolved before the summer. (I would use my SA advance to pay it off)

I searched TLS before I talked to my career services and everyone seemed to troll the poster and basically said it was not a big deal.

Now I'm unsure is it a big deal? Can I lose my offer?

[tyroneslothrop1]

Hard to say. I find your decision to just ignore the debt pretty baffling and I imagine the people at the firm are likely to feel the same. I would probably write them a matter of fact email noting the debt and stating that you in the process of paying it off and to please contact you if they have any further questions or concerns.

[CanadianWolf]

I don't know how this particular law firm will react. It is certainly possible that this could be construed as "the appearance of impropriety".

You should disclose this to any state bar C&F. State bars hate financial irregularities.

Not related to your specific situation: But if this scenario came up on a law school examination, I would be sure to raise the issue of standing. Does the, presumably, third party debt collector have proof of the right to sue on this account ?= standing to sue. Regardless as to whether in the hypothetical problem the alleged debtor admitted liability for the debt, does the plaintiff have proof of standing to sue this particular defendant on this particular account. Then I would settle for 50% & demand a cleaned up credit report.

OP: I know nothing about your particular situation. This is not intended as legal advice for you, or to you.

[Mobster1983]

If the firm is doing a credit check, and you are being sued for unpaid debt, then this is probably going to be a big deal. Having unpaid debt in collections is bad enough, being sued means you have completely stopped paying on your debt. Unless you are contesting that this debt is legit, then you should work to resolve it right away. Finance issues are understandable, but it doesn't look good. The fact that you just stopped paying a presumably legitimate debt, apparently without trying to work out some sort of payment plan, would probably raise a pretty big red flag. JMHO.

I would try to work out a payment plan with the collection agency (or whoever is suing you) ASAP, then write a letter to the firm explaining that you are in the process of paying.

[Anonymous User]

Not OP but I'm just wondering if running a credit check for SAs is pretty common? Also, how much do they find out? I started and failed a business before law school so I have lots of CC debt. No missed payments, and I think I still have a decent low 700s score, but should I be concerned that they'll get a full report with accounts/balances? Or do they just get a score plus any major issues?

Also when do they usually do this check?

[Anonymous User]

Not paying at all looks pretty bad IMO. Couldn't make a $100 payment a month to hold them over from suing? Find that pretty hard to believe.

[CanadianWolf]

Looks bad, but some law students cannot afford books & really skimp on food & other essentials.

[CanadianWolf]

I thought almost all law firms run credit checks. You probably were asked to sign a consent form for the background check.

[minnbills]

This could definitely be an issue. Some firms do fairly extensive background checks before bringing in SAs. I think the bigger the firm, the more likely it is they'll do a credit check. After all, once you're in the door you will have access to sensitive commercial information, which the firm has an interest in protecting.

OP should disclose this issue. Better for the firm to hear it from OP than from equifax.

[mvp99]

Unless there is a reason showing extreme economic hardship, I think this will be an issue.

[CanadianWolf]

You are all correct. Of course, it is an issue. It is serious. Folks hire lawyers to make serious issues go away or make serious issues far less serious--routine business matters.

OP has to handle this promptly & effectively.

[AppraisalWaisal]

Yeah, this seems like a problem. I'd be concerned about being admitted to the bar too. Having debt is certainly no big deal. Being delinquent is also not as big of a deal. Willfully ignoring the delinquent debt....

[Anonymous User]

At my firm you also have to disclose if you're a party to litigation.