Making Payments On Debt And Sued Anyway

by lori
(elgin, il)

I received a letter stating I owe a bill, which I do. I began making payments online to said company. I got a notice i have to go to court i called to find out why and they said because I never made an official payment arrangement with them. If they accepted and processed my previous payments does that constitute a payment arrangement? Now they are saying I need to pay 5 times what i was paying or go to court?

I feel like by them accepting and processing my last 3-4 payments the are agreeing to me paying that amount?

Reply from

This is one of the biggest misconceptions about collection accounts--that as long as you are making payments they have to allow you to continue to make those same payments. That's not always true.

When a consumer defaults on a debt they open themselves up to whatever collection activities are legal in their state. State laws vary, so we can't specify what applies in your situation, but most do allow for interest to be charged while a debt is in collection and some may allow the collector to charge fees.

Still five times the amount, for a debt that sounds like it was recently placed for collection does sound like it could be excessive. We recommend you do a little digging to find out whether that's legal in your state. Your state attorney general's office may be able to help, or your local Legal Aid office may publish guidelines. If it's not, you may have a defense against the collection lawsuit.

Please read our information abut being sued for a debt.

Also, if you had a written payment agreement that spelled out the terms of the repayment plan then you might have a valid point that they shouldn't be taking you to court. And it's possible there is an implied contract here, but trying to figure that out and fight it could get expensive.

You don't mention how large this debt is, or whether you have other debts you are struggling to pay. If you owe a substantial amount of debt, it would be a really good idea to talk with a bankruptcy attorney.

Find out how to get free or low-cost help with your debt collection problems here.

We hope this works out for you!

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