How much can a lawyer settle my debt for in Texas?

There is no fixed percentage and no lawyer can promise a number. Results depend on the age of the debt, who owns it, whether it is past the four-year statute of limitations, and whether you can pay a lump sum. Charged-off accounts held by debt buyers often settle for considerably less than the balance because the buyer paid pennies on the dollar. Original creditors with recent accounts tend to hold firmer. We give you a realistic range after reviewing your file.

Will debt settlement hurt my credit score?

If the account is already delinquent or charged off, the damage is largely done, and a settled account with a zero balance is better than an open collection. We negotiate for the most favorable reporting language available, such as paid in full or settled, and under the Fair Credit Reporting Act the account must drop off your report seven years after the original delinquency regardless of settlement.

Do I have to go to court to settle a debt in El Paso?

No. Debt settlement is a negotiation, not a lawsuit, and everything happens through letters, phone calls and email between our office and the creditor. If a creditor has already sued you in an El Paso justice court or county court at law, we can file an answer to protect you from a default judgment and usually resolve the case by agreed settlement without you ever attending a hearing.

Can my wages be garnished for credit card debt in Texas?

No. The Texas Constitution and Property Code § 42.001 prohibit garnishing current wages for ordinary consumer debts such as credit cards, medical bills and personal loans. Exceptions exist for child support, federal student loans and taxes. A judgment creditor can, however, try to garnish a bank account once wages are deposited, which is one reason it is wise to settle before a judgment is entered.

How much does a debt settlement lawyer cost in El Paso?

We charge a flat fee per account, quoted before you hire us, rather than a percentage of your debt or a monthly program fee. The fee depends on the number of accounts and whether any are already in litigation. Compared with settlement companies that charge 15 to 25 percent of enrolled debt, an attorney flat fee is usually far less. Call (915) 526-0787 for a quote.

Debt Settlement Lawyer El Paso

Attorney-Negotiated Debt Settlement in El Paso — Pay Less, in Writing, Without Court

We negotiate directly with credit card companies, medical providers, debt buyers and collection agencies to settle what you owe for a reduced lump sum or affordable plan, with every agreement documented in writing.

Last reviewed by Robert Andrew Navar, Esq. · State Bar of Texas

Debt settlement is the process of negotiating with a creditor or collector to accept less than the full balance, or a payment plan you can actually afford, in exchange for closing the account. It is the right tool for El Paso residents who have fallen behind on credit cards, medical bills, personal loans, repossession deficiencies or old accounts that were sold to a debt buyer, but who have some money or income to work with and want to avoid a lawsuit or bankruptcy. Many people try to negotiate on their own and get nowhere, because collectors know an unrepresented consumer rarely follows through. A letter from an attorney changes the conversation.

Texas law gives you more leverage than most people realize. Under Texas Civil Practice and Remedies Code § 16.004, a creditor generally has four years from default to sue on a consumer debt, and Texas Finance Code § 392.307 prohibits collectors from suing or threatening suit on a time-barred debt. Texas is also one of the most debtor-friendly states in the country: Texas Constitution Article XVI, § 28 and Property Code § 42.001 bar wage garnishment for ordinary consumer debt, and Property Code Chapters 41 and 42 exempt your homestead, a vehicle per licensed driver and up to $100,000 in personal property for a family. Collectors who understand that a judgment against you may be uncollectible are far more willing to settle for a fraction of the balance.

Navar Law starts by pulling your credit reports and verifying every balance, because debt buyers frequently cannot document what they claim you owe. We then send a written settlement proposal on firm letterhead, negotiate by phone and email, and refuse to let you pay a dime until the settlement terms, including a statement that the account is settled in full and will be reported that way, are in writing. Nothing in this process involves a courtroom. Attorney Robert Navar handles the negotiation, and if any creditor has already filed suit in El Paso County, we fold that case into the settlement strategy before a default judgment can be entered. Debt settlement also pairs naturally with our credit report dispute and debt collector harassment services.

Who is a good candidate for debt settlement in El Paso?

Settlement works best when you can raise a lump sum, whether from savings, family, a tax refund or a modest loan, equal to roughly 30 to 60 percent of the balance, or when you have steady income for a short structured plan. It is most effective on unsecured debt: credit cards, store cards, medical bills, personal loans, payday loans and charged-off accounts held by debt buyers. It is not the right tool for secured debt such as a car note or mortgage, for federal student loans, or for child support and most taxes.

If your total unsecured debt is more than you could realistically settle within a year or two, Chapter 7 bankruptcy may cost less and finish faster. We tell El Paso clients honestly which path fits, because a settlement plan you cannot complete is worse than none.

Common mistakes when settling debt on your own

The most expensive mistake is paying before the deal is in writing. A verbal promise from a collector means nothing when the account is sold again next month. Others include making a small good-faith payment that revives an otherwise time-barred debt, giving a collector your bank account information, settling with a company that does not actually own the debt, and ignoring the tax consequences, since forgiven debt over $600 can generate a Form 1099-C.

Be cautious with national debt relief companies that advertise in El Paso. Many charge monthly fees, tell you to stop paying everyone, and leave you exposed to lawsuits while they hold your money. Texas Finance Code Chapter 394 regulates debt management services, and an attorney negotiating on your behalf is a different thing entirely.

What's included

Review of all three credit reports and verification of each balance and current owner of the debt
Statute of limitations analysis under CPRC § 16.004 for every account
Written settlement proposal on firm letterhead and direct negotiation with the creditor or collector
Review and negotiation of the settlement agreement so it says paid or settled in full, with credit reporting terms
Instructions on how and when to pay so you keep proof of every payment
Written explanation of possible 1099-C tax consequences
Follow-up if the settled account is reported incorrectly afterward

How it works

Free debt review

Bring your collection letters, statements and any lawsuit papers to our El Paso office or send them electronically. We pull your credit reports, list every account, check the statute of limitations and quote a flat fee per account.

Negotiation

We send a written proposal and negotiate with each creditor or collector. You approve every offer before we accept it. Collectors are instructed to contact our office, not you, which stops the calls while we work.

Written agreement and payment

Once the terms are in a signed writing, you pay according to the schedule and we confirm the account is closed and correctly reported. You receive a complete file for your records.