Q:
I am being sued in small claims court by a collection agency. I have been paying my bills every month but they want me to pay more each month than I can afford. What are my rights? Can they do this?
S. from Stevens Point, WI
A:
Since 1982, multi award winning attorney Todd C. Esser has been leading the field, serving the community, and helping consumers just like you achieve success through trying financial times.
Making payments on an account is not a defense to a demand for payment. Unless you and the creditor agreed to modify the terms of payment, the creditor is entitled to demand payment in full. Likely, the collection agency is only using the threat of sending you to small claims as a way of extracting a larger payment from you.
If a small claims lawsuit is filed, there is still opportunity to negotiate payment terms with the attorney for the creditor and perhaps obtain a dismissal of the lawsuit on terms, subject to the case being reopened in the event of a default.
If you are unable to negotiate a reasonable payment with the collector or the attorney, consider using a debt amortization plan under chapter 128.21 of the Wisconsin Statutes to spread out payment of the claim over 3 years while being protected from garnishment.
I’ve attached two resources to give you some additional information and ideas:
What is Chapter 128? http://www.esserlaw.com/debt-amortization/
What is Debt Consolidation? Video – https://www.youtube.com/watch?v=Ytir7BTw-XU
Looking forward to your good financial health!
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