If you've defaulted
You Took Out a Loan and Defaulted. What Are Your Options?
Defaulting on a loan feels like the end of the conversation. It usually is not. Lenders and debt buyers expect to negotiate. Many lawsuits over consumer and business debt have serious legal problems that the plaintiff is hoping you never spot.
First, do not panic-call the lender
Anything you say can be used to restart the statute of limitations or admit the debt. Get the file together: the original loan documents, the payment history, every collection letter, and any lawsuit paperwork. Then talk to a lawyer before you talk to a collector.
Settlement is almost always available
Most defaulted consumer and small-business loans get sold to debt buyers for pennies on the dollar. Those buyers will frequently settle for 30–60% of the face amount, often in installments. A lawyer-led negotiation typically beats what you can get on your own and includes proper release language so the debt actually goes away.
If they sue, defenses exist
Debt-buyer lawsuits often fail on standing, chain of title, statute of limitations, or improper service. We routinely get cases dismissed or reduced dramatically when defendants thought they had no options. The worst move is to ignore a summons (see our page on receiving a summons).
Talk to a New York attorney about your matter.
Flat-fee matter review. Straight answers, no runaround.