When a law office is refusing to accept any payment arrangement that I offer, what can I do?

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When a law office is refusing to accept any payment arrangement that I offer, what can I do?

I’m trying to work out a payment arrangement with them. However they’re refusing to accept what I can afford. I responded to the summons/complaint and I went to my court date where the judge told me I needed to work something out with the attorneys office. However they are collecting on $17,000 and they’re telling me they’l only accept $3200 down and $400 a month. I cannot afford to do that and I’ve sent paperwork showing that I can’t. What can I do at this point? They said they’re trying to obtain judgement.

Asked on April 20, 2012 under Bankruptcy Law, Missouri

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

You probably need to consider bankruptcy as an option, particularly if this is not a secured debt (that is, if it's not a mortgage, auto financing, or other debt where some property or asset you need is the collateral for the debt). That because when you are in default on a debt, the creditor is not required to accept anything other than the full payment to which it is entitled. If the creditor agrees to a payment arrangement, it is voluntary; and since it's voluntary, the creditor has the right to require any amount or payment schedule it likes. If you can't meet what they want, they don't have to propose something you can afford; instead, they can sue you and seek a judgment.

If you do owe the money, assume they will get their judgment. Once the get a judgment, if you still do not pay, the creditor can try to recover the money from you in a variety of ways, such as putting a lien on real property, levying on (taking money from) your bank account(s), executing on (haveing the sheriff or a constable seize and sell) some of your non-real estate property, or in most states, garnishing your wages.

While bankruptcy will hurt your credit rating, it will not, by most accounts, hurt it much more than having an unsatisfied judgment against you. On the other hand, bankruptcy will enable you to substantially reduce or eliminate this debt--it therefore is an option you should consider.


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