Creditors often go to court in an effort to collect what is owed them. Or, they may use arbitration, a less formal but also legally binding and enforceable process.
In an arbitration, a neutral third party (arbitrator) hears both sides of the dispute. The proceedings can be filed either by original creditors or by an assignee who has purchased debts from others. Some kinds of debt, including credit cards and medical services, include in their contract a provision that their consumers/debtors use arbitration to settle their disputes.
Creditors are not required to bring an attorney to arbitration proceedings, but engaging a competent attorney is often the best possible step toward successful resolution of a dispute. Arbitration is a legally binding process. An attorney’s experience and understanding may make the difference between an arbitration “win” or loss.
While most hearings are held in person, occasionally phone, email or written communications are acceptable as alternate forms of proceedings. After the proceeding, if the arbitrator decides the debt is valid, the creditor or debt collector must then go to court to obtain a judgment and then can request that the court issue garnishment orders as a result of the judgment.
Arbitration involving creditors may take place before bankruptcy is even a consideration by the debtor. There are also conditions during bankruptcy proceedings in which a creditor may request arbitration, and may take the dispute in question back to a bankruptcy judge.
Working with an experienced and knowledgeable Arizona creditor’s attorney can be a tremendous help. If you would like more information about creditors and bankruptcy, creditors’ rights, or if you need assistance from an attorney, contact Windtberg & Zdancewicz to schedule an initial consultation.
The attorneys at Windtberg & Zdancewicz, PLC, provide clients with experienced legal representation in all collection matters. We are experienced in creditor’s rights including garnishments, charging orders, attachment, property execution, trustee’s sales, foreclosures, judgments, judgment collection, domestication of foreign judgments, and creditor’s issues in bankruptcy cases. If you need assistance with your collection matters, please contact us at (480) 584-5660.
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