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Roberta Said:

My husbands credit is SHOT due to medical...How to rebuild his credit when we really cant pay off the debt?

We Answered:

Did you have insurance at the time, are the debts due to your insurer not covering the charges?
If so then you should know there is a common practice known as balance billing, which often is illegal. When doctors or hospitals think an insurer has reimbursed too little, state and federal laws generally bar the medical providers from pressuring patients to pay the difference. Instead, doctors and hospitals should be wrangling directly with insurers.

Balance billing most frequently occurs when medical providers participating in a managed-care network believe the plan's insurer is imposing too deep a discount on medical bills or is taking too long to pay. California, New Jersey and 45 other states ban in-network providers from billing insured patients beyond co-payments or co-insurance required by the plan. Similarly, federal law prohibits providers from billing Medicare patients for unpaid balances.
These laws require medical providers to seek payment only from the insurer for services covered by the plan. Many states also shield insured patients from balance billing by out-of-network hospitals and doctors in emergencies, since patients usually don't control who treats them in those situations. (Bans on balance billing generally don't apply when a patient gets an elective procedure, such as cosmetic surgery, or seeks out-of-network, non-emergency service without a referral.)
Contact your State Attorney Generals office to see if your state bans balanced billing.

If you had no insurance then you should try and work out a payment schedule with them. The damage has been done already by the debts going into collections but at least if you are making payments, it will look better to any creditors or lenders you might have to deal with in the future.

If you do nothing, they just may seek legal action in court to obtain a judgment and request a "writ of garnishment" to collect by garnishing your income (if permitted in your state).

Fernando Said:

If a credit card company sues, what can you lose?

We Answered:

All a lawsuit does is provide a court judgment that can be used to levy claims against your financial assets. A lien can be placed on the home and the warehouse, and it could lead to a court order for seizure and auction to satisfy part of the debt. Same with other personal property. Bank accounts can be garnished.

On the plus side, Social Security benefits are exempt from court judgements for debts and cannot be garnished.

The best option at this point? If your parents don't show up in court, the judgment will default to whatever the company demands. That's the worst case. Even showing up in court with no lawyer, it will be better than no-show. Some things a judge simply won't allow a company to claim if the defendants are there. And given evidence of your parents' mental status, a judge may be more lenient in his decision.

The company will still get their ruling, but it may be severely limited from what they originally hoped for.