Correct, they generally cannot take wages without a court order, and the only way to get a court order is after obtaining a judgment.
I have seen many creditors that used to pursue collections aggressively not be as aggressive lately, probably because of the economy, but that has been more in the area of collecting deficiency balances after foreclosure sales rather than credit card collection actions.
I cannot tell you what to do since I cannot give advice online, but bankruptcy may be a decent alternative, especially if you are losing your home too. Some people don't file bankruptcy because of the credit score hit, but not filing allows the credit cards to hit your credit with late payments for 7 years, which may be just as damaging, all the while having them hassle and potentially sue you. Sometimes a bankruptcy provides a fresh start that is worth more than some credit points saved.
If you opt not to file bankruptcy, then credit cards become uncollectable after the statute of limitations expires, which varies from state to state, but is usually around 6 years. This doesn't mean they won't continue to try to collect after the statute expires, but if they do sue you after that and you tell the court the statute expired, their case may get dismissed. Each time a charge is made or a payment is made though, the statute starts tolling all over again.
Two other options some people try are credit counseling and debt settlement. Credit counseling is where you contact a credit counseling agency, then they contact all unsecured creditors (they won't deal with secured creditors) and they set it all up in one payment with low interest. Debt settlement is where you settle the credit cards for substantially less than the amount owed, but you generally have to do this in a one-time lump sum payment, so this doesn't work unless you have some cash on hand to work with (which most people don't nowadays).
I'm not sure what type of information you are looking for, so let me know if this didn't help!
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