People frequently ask if one can actually be sued for debts owed and the answer is simply yes you can.
You owe this money and you need to repay it or your lender can possibly take action against you. However the good news is that there are several laws and regulations that these financial institutions must stick by. As a consumer, you are protected- to an extent.
There are two types of law that have rules on debt.
They are State Laws and Federal Laws. Every state will possess their own rules with regard to debt collection so it's most beneficial if you read up on them. There should be a statute of limitation which will show how long your creditors have to file a lawsuit to recoup their money owed. Federal laws apply to everyone regardless of which state you live in.
An important law is: Federal Fair Debt Collection Practices Act. This law covers how your creditors must conduct when trying to collect debts.
If you're experiencing problems paying back your debts, get to a phone and ask help from a debt counseling service and possibly a lawyer if you owe money in the tens of thousands. You should be able to determine which advisor that can help. Your advisor will usually want you to write down exactly how much debt you have and how much money you make from all sources and what you spend this money on. They'll advise on which debts are mandatory to be paid. Tax debt is a serious issue as the government can literally seize property and bank accounts to pay off the debts owed to them.
Uncle Sam doesn't mess around.
Student loans are also government protected and cannot be cleared away through bankruptcy.
Whatever you do, do not brush off the situation you are in. All debt problems can be solved one way or another. Bankruptcy is always an option but usually a last resort. Making sure your creditors are informed will help prevent them from collecting right away. Negotiating with creditors can buy some time.
Suing you isn't your creditors' only option as most sell your debt onto a third party company who won't care what your personal circumstances are. These third party companies are known as debt collection agencies and they will bug you everyday so they can get paid. Creditors can also put liens and judgments on properties so be careful. It can get complicated and turn into a lawsuit. Get educated and learn about getting your debts repaid to avoid this situation. You don't want a legal headache on top of a financial one.