How to Settle a Debt in Hawaii

Edited by Hannah Locklear

Debt. Almost everyone has it, whether it comes from an auto loan, credit card, or mortgage. Unfortunately, sometimes people fall behind on their obligations and get stuck in a cycle of nonpayment. Once you stop paying your creditors, you can expect them to take action, potentially in the form of a debt lawsuit.

If your creditor wins a debt lawsuit against you, they’ll obtain a judgment they can use to garnish your wages or freeze your bank account. You won’t have complete control of your finances anymore. Instead, your creditor will take the maximum amount they can from you each pay period.

You don’t have to accept a judgment from your creditor or debt collectors. If you settle your debt before your court date, you can move on from the lawsuit and start fresh.

In this article, we’ll explain everything you should know about how to settle a debt in Hawaii.

There are 3 steps to debt settlement

Getting sued in Hawaii is the worst. If you’d like to settle your debt before your court date, you should take these three specific steps:

1. Respond to the debt lawsuit with an Answer.
2. Make an offer to start the negotiation process.
3. Get your settlement agreement in writing.

Keep reading to learn more about each step. Otherwise, check out this video:

1. Respond to the debt lawsuit with an Answer

Creditors and debt collectors will begin a debt lawsuit against you by filing a Complaint. The Complaint will list the grievances against you, including nonpayment of your obligation. It will likely document when you stopped making payments and the total amount you owe, including interest and fees.

Many people make the mistake of failing to respond to the Complaint. When you don’t respond to the lawsuit, you’re essentially admitting your guilt. Instead, file an Answer into the court case and send a copy to your creditor or debt collector.

An Answer is a legal document that allows you to respond to each claim against you and establish your defense in the case. You can use various defenses, but a few of the most common include insufficient documentation of the debt or lack of business relationship between you and the debt collector.

While you plan to settle your case before your court date, you should still file an Answer as an extra layer of protection between you and a judgment if your efforts to resolve the debt fall through.

In Hawaii, you have 20 days to respond to a debt lawsuit before you lose by default judgment. With a default judgment, creditors and collectors can garnish your wages and seize your property.

You can avoid a default judgment and buy yourself time to settle the debt when you file an Answer.

2. Make an offer to start the negotiation process

Your next step is to evaluate how much you can afford to pay in a settlement. Examine how much you have in savings and upcoming paychecks. If you’re short on cash, consider selling a few items you don’t need or obtaining help from friends and family.

We recommend that you start the settlement process by offering your creditor at least 60% of the total value of your debt. That amount is enough to show your creditor you’re serious about settling.

It’s not unusual to go through several rounds of negotiation before reaching a settlement agreement. Your creditor will likely try to counter your offer with a higher one. Keep a cool head throughout the process, and don’t accept any offer you know you can’t adhere to.

SoloSettle sends and receives settlement offers for you.

Get your settlement agreement in writing

Once you have a deal with your creditor, don’t transfer any money until you receive a signed, written agreement. A written contract ensures that everyone completely understands the terms of the deal.

Your agreement should list your repayment amount, the due date, and the method of transferring the money. It should also stipulate that the payment constitutes a total settlement of the debt. Creditors and debt collectors won’t have any rights to the remaining amount of your obligation upon settling.

Not sure what a settlement agreement should include? Here’s a debt settlement agreement example for your reference, with a preview attached below:

INSERT IMAGE HERE

You’ll notice that there is a space for a notary to sign the contract. Notarizing the agreement ensures that all parties understand its terms and fully validate the deal.

Now, let’s look at an example of how to settle a debt in Hawaii.

What are Hawaii’s debt collection and debt settlement laws?

Hawaii has several laws that prohibit debt collectors from taking specific actions. According to HI Rev Stat § 443B-16 (2013), creditors cannot:

• Use profane or obscene language against the creditor.
• Make calls to the creditor without disclosing their identity.
• Purposely cause expense to the creditor by calling them long-distance or using telegrams.

Under HI Rev Stat § 443B-17 (2011 through Reg Sess), collection agencies cannot:

• Publish the consumer’s debt through means such as the newspaper.
• Notify people the consumer knows that the person owes a debt, such as an employer or family member.

The HI Rev Stat § 443B-18 (2020) makes it illegal to use fraudulent or deceptive means to collect a debt.

In addition to the debt collection statutes in Hawaii, the state also abides by the Fair Debt Collection Practices Act (FDCPA), which has additional protections for consumers, such as prohibiting debt collectors from:

• Calling the consumer at odd hours, like before 8 a.m. or after 9 p.m.
• Contacting a consumer more than seven times in one week concerning a debt.
• Threatening the consumer with jail time if they don’t repay a debt.

Like other states, Hawaii has statute of limitations laws that cap the time a creditor has to pursue debt collection. Under HI Rev Stat § 657-1 (2012), oral and written contracts and debts on account are limited to six years.

Plus, the Federal Trade Commission has recently amended the Telemarketing Sales Rule to expand debt settlement regulations to all debt relief organizations and companies. All 50 states, including Tennessee, are governed by this Rule as it relates to debt settlement practice.

Under the new Rule, any company that provides debt relief services, namely debt settlement companies, cannot:

• Charge upfront fees. Debt settlement companies cannot collect any fees from a consumer before the debt has been effectively settled or otherwise resolved.
• Fail to disclose certain information about its services before a consumer enrolls in the program. This includes how much the service costs, how long it takes to see results, how much money must be saved before a settlement offer is made, consequences that may occur if the consumer fails to make payments on time, customer’s rights, and other important terms.
• Misrepresent their services. No false or unsubstantiated claims can be made regarding a debt settlement company’s services.

What are the best debt settlement companies?

If you’re considering seeking help for debt settlement, there are a few companies that we recommend.

SoloSettle

SoloSettle is a debt settlement organization that can help you if you’re facing a debt lawsuit. Our team works directly with your creditor to negotiate a settlement for you. Once you agree to the settlement, we’ll facilitate the payment process, so you won’t need to share your bank account details with the creditor.

Freedom Debt Relief

Freedom Debt Relief is one of the older debt settlement organizations in the United States. Since 2002, the company has helped more than 750,000 people settle their unsecured debts. Freedom Debt Relief’s programs last between two and four years and have fees of between 15% and 25%.

National Debt Relief

National Debt Relief is another large provider of debt settlement services. Since 2009, its programs have allowed thousands of individuals to settle their debts and obtain a fresh financial slate. Most people who enroll with National Debt Relief will complete their programs within four years.

What are the best ways to contact a debt collector?

If you’d like to try settling your debt yourself, you can start the conversation via phone call, email, or letter.

We recommend email since it’s efficient and provides you with a written record of your discussion with your debt collector. You’ll have time to consider each message from your creditor rather than being put on the spot.

If you prefer an oral negotiation, you can call your debt collector. However, we recommend recording the conversation so you can refer to it if necessary. Under HI Rev Stat § 803-42, only one party needs to consent to record a call in Hawaii. You’ll be the consenting party.

FAQs about how to settle a debt in Hawaii

Do you have more questions about settling a debt in Hawaii? Here are a few of the top inquiries we hear at SoloSuit.

Q. What is a reasonable offer to settle a debt?

People often wonder what amount they should offer their creditors in a settlement. We recommend starting with at least 60% of your debt’s value. That’s enough to express sincerity about settling your debt, and your creditor will counter the offer if they don’t believe it’s enough.

Q. Can I do my own debt settlement?

Yes, it is possible to do your own debt settlement. Before doing so, spend some time reviewing the guides on our SoloSuit website. Once you feel ready, email your creditor to start the process.

Q. Is it better to settle a debt or pay it off?

It’s always better to pay a debt in full. Doing so will maintain your credit score and your relationship with your creditor. However, settling a debt is appropriate when you’re facing a lawsuit or a debt trap you can’t get out of.

How to get debt relief in Hawaii

Remember those debt relief guides we spoke about earlier? We’ve combined a handy list of them you can review as you prepare to settle your debts.

• How to Get Debt Relief in Hawaii | SoloSuit Blog
• Statute of Limitations on Debt in Hawaii | SoloSuit Blog
• How to Answer a Summons for Debt Collection in Hawaii (2022 Guide) | SoloSuit Blog
• Hawaii Court Case Search — Find Your Lawsuit | SoloSuit Blog

Debt settlement is a process that delivers results

Financial matters are a part of life, but sometimes they get out of hand. If you’re in a difficult situation, debt settlement may be your ticket out. Make sure you understand the process before starting and only accept a settlement offer you can afford to repay.

SoloSuit can help with your debt settlement process — find out how.

What is SoloSuit?

SoloSuit makes it easy to fight debt collectors.

You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt.

SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

>>Read the NPR story on SoloSuit. (We can help you in all 50 states.)

How to answer a summons for debt collection in your state

Here's a list of guides for other states.

All 50 states.

• Alabama
• Alaska
• Arizona
• Arkansas
• California
• Colorado
• Connecticut
• Delaware
• Florida
• Georgia
• Hawaii
• Idaho
• Illinois
• Indiana
• Iowa
• Kansas
• Kentucky
• Louisiana
• Maine
• Maryland
• Massachusetts
• Michigan
• Minnesota
• Mississippi
• Missouri
• Montana
• Nebraska
• Nevada
• New Hampshire
• New Jersey
• New Mexico
• New York
• North Carolina
• North Dakota
• Ohio
• Oklahoma
• Oregon
• Pennsylvania
• Rhode Island
• South Carolina
• South Dakota
• Tennessee
• Texas
• Utah
• Vermont
• Virginia
• Washington
• West Virginia
• Wisconsin
• Wyoming

Guides on how to beat every debt collector

Being sued by a different debt collector? Were making guides on how to beat each one.

• Absolute Resolutions Investments LLC
• Accredited Collection Services
• Alliance One
• Amcol Clmbia
• American Recovery Service
• Asset Acceptance LLC
• Asset Recovery Solutions
• Associated Credit Services
• Autovest LLC
• Cach LLC
• Cavalry SPV I LLC
• Cerastes LLC
• Colinfobur
• Covington Credit
• Crown Asset Management
• CTC Debt Collector
• Cypress Financial Recoveries
• Delanor Kemper & Associates
• Eagle Loan of Ohio
• Educap
• Estate Information Services
• FIA Card Services
• Forster & Garbus
• Freshview Solutions
• Fulton Friedman & Gullace LLP
• Harvest Credit Management
• Howard Lee Schiff
• Hudson & Keyse LLC
• Integras Capital Recovery LLC
• Javitch Block
• Jefferson Capital Systems LLC
• LVNV Funding
• Mannbracken
• Mariner Finance
• Medicredit
• Michael J Adams PC
• Michael J Scott
• Midland Funding LLC
• Mullooly, Jeffrey, Rooney & Flynn
• Mountain Land Collections
• MRS Associates
• National Collegiate Trust
• Nationstar Foreclosure
• Northstar Capital Acquisition
• NCEP LLC
• NRC Collection Agency
• OneMain Financial
• Palisades Collection LLC
• Pallida LLC
• Paragon Revenue Group
• Pinnacle Collections Agency
• PMAB LLC
• Portfolio Recovery Associates
• Provest Law
• PYOD LLC
• Reunion Student Loan Finance Corporation
• Revenue Group
• Regents and Associates
• RSIEH
• Salander Enterprises LLC
• Second Round Sub LLC
• Security Credit Services
• Sherman Financial Group
• Suttell and Hammer
• T-Mobile
• Transworld Systems
• Tulsa Teachers Credit Union
• UCB Collection
• Velo Law Office
• Velocity Investments
• Waypoint Resource Group
• Weinberg and Associates
• Wolpoff & Abramson

Win against credit card companies

Is your credit card company suing you? Learn how you can beat each one.

• Bank of America
• Capital One
• Chase
• Credit One Bank
• PayPal Synchrony Card
• SYNCB/PPEXTR
• Synchrony Bank
• Target National Bank
• Wells Fargo

Going to Court for Credit Card Debt — Key Tips

How to Negotiate Credit Card Debts

How to Settle a Credit Card Debt Lawsuit — Ultimate Guide

Get answers to these FAQs

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Learn More With These Additional Resources:

Need help managing your finances? Check out these resources.

How to Make a Debt Validation Letter - The Ultimate Guide

How to Make a Motion to Compel Arbitration Without an Attorney

How to Stop Wage Garnishment — Everything You Need to Know

How to File an FDCPA Complaint Against Your Debt Collector (Ultimate Guide)

Defending Yourself in Court Against a Debt Collector

Tips on you can to file an FDCPA lawsuit against a debt collection agency

Advice on how to answer a summons for debt collection.

Effective strategies for how to get back on track after a debt lawsuit

New Hampshire Statute of Limitations on Debt

Sample Cease and Desist Letter Against Debt Collectors

The Ultimate Guide to Responding to a Debt Collection Lawsuit in Utah

West Virginia Statute of Limitations on Debt

What debt collectors cannot do — FDCPA explained

Defending Yourself in Court Against Debt Collector

How to Liquidate Debt

Arkansas Statute of Limitations on Debt

Youre Drowning in Debt — Heres How to Swim

Help! Im Being Sued by My Debt Collector

How to Make a Motion to Vacate Judgment

How to Answer Summons for Debt Collection in Vermont

North Dakota Statute of Limitations on Debt

ClearPoint Debt Management Review

Indiana Statute of Limitations on Debt

Oregon Eviction Laws - What They Say

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Debt Consolidation in Eugene, Oregon

Summoned to Court for Medical Bills? What to Do Next

How to Make a Debt Settlement Agreement

Received a 3-Day Eviction Notice? Heres What to Do

How to Answer a Lawsuit for Debt Collection

Tips for Leaving the Country With Unpaid Credit Card Debt

Kansas Statute of Limitations on Debt Collection

How to File in Small Claims Court in Iowa

How to File a Civil Answer in Kings County Supreme Court

Roseland Associates Debt Consolidation Review

How to Stop a Garnishment

Debt Eraser Review

Do Debt Collectors Ever Give Up?

Can They Garnish Your Wages for Credit Card Debt?

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How Long Does a Judgement Last?

​​How Long Before a Creditor Can Garnish Wages?

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