What to do if I took out a payday loan 3 years ago an defaulted on it?
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What to do if I took out a payday loan 3 years ago an defaulted on it?
I wasn’t able to pay the fees associated with it anymore and it was putting my bank further into the red. So, my bank account was closed. Now 3 years later, I get a call from a processor, he says that he’s not a collection agency. Tells me I have 1 day to pay $500 by money gram or I will be turned over to a paralegal that will file my case as check fraud. Do I pay now? Do I have any options?
Asked on December 12, 2012 under Bankruptcy Law, California
Answers:
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
Don't pay the $500. This sounds like a scam.
Until you are served with a lawsuit, you have nothing to be concerned about. If you are served with a summons and complaint (the complaint is the lawsuit attached to the summons), you will have an opportunity to file a response (answer to the complaint). The complaint and the answer are only the beginning steps in litigation. Until a case proceeds through litigation and there is a judgment against you, do not worry about it. If a judgment is obtained against you which you cannot pay, you can file bankruptcy at that time. If this were a reputable outfit, the individual who called would not have the phony title of "processor", and the lawsuit would be filed by a reputable law firm; not some paralegal. Moneygrams are notorious for being scams.
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