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cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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I am having trouble with my creditors, I have talked with them

Resolved Question:

I am having trouble with my creditors, I have talked with them on several occasions. In regards XXXXX XXXXX being able to afford my monthly payment. I can pay a little bit every month to them until I have other bills paid off. Now they are saying that if I don't pay them they will turn me over to collectors/lawyers. What are my options? What if I just pay what I can til I have my other bills paid off then can pay them more? A debit relief place can't help me either. Do I have to file bankruptcy?
Submitted: 6 years ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 6 years ago.

Hi JACustomer,

If you cannot make an arrangement with your creditors whereby they will agree to accept what you can afford, you are really wasting your money by paying less than what they want. This is because with fees and interest, making a minimal payment is not helping.

The extra money you have to pay these creditors would probably be better used to save up enough to file a Bankruptcy, which will cost around $1200 for the attorney, and $299 for the court filing fee.

I think this is what you wanted to know. If not, please let me know.
Thank you!

Edited by cfortunato on 1/4/2011 at 11:32 PM EST
Customer: replied 6 years ago.
What if I don't want to file bankrupcy and just pay what I can, understanding that it doesn't do much to the bill. But am at least making an effort. With the hopes that I can pay more soon.
Expert:  cfortunato replied 6 years ago.
Paying what you can will not make a difference with the creditors. If they are not happy with what you are paying - if they do not agree to the minimal payments - paying what you can has exactly the same effect as paying nothing, and will not prevent them selling the accounts to collection agencies.
Customer: replied 6 years ago.
So what happens if it goes to the collection agencies? It will take me over a year to come up with the money to file bancrupcy.
Expert:  cfortunato replied 6 years ago.

The collection agencies will eventually start calling you, but if you notify them in writing that they cannot call, they must stop, or you can sue them for up to $1000. This is because of the Fair Debt Collection Practices Act.

After about 6 months to one year or longer, some collection agencies go to court to get judgments, and some collection agencies sell the debts to other collection agencies, which will start to call you, and then if you notify them, they must stop, etc.

If any collection agency gets a judgment, that judgment can be used to garnish wages (if you take home more then $217.50 per week), and bank accounts, and can be used to place liens on property.

It is unlikely that any judgment will be gotten before one year, as the court process takes at least a few months (you have to be served the papers, and have to go to court, where you are allowed at least one postponement, which will be for at least another few months).

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