Attorney Collection Effort

[Neall]

Hi, we live in Texas and have a small medical debt of $261.00. We've had a hard time this year and have not made a payment on this. We received a letter from an attorney out of state that stated if we did not pay or make arrangements, it would be referred to an atty in Texas for immediate suit. My question is, would they really sue for such a small amount? How receptive will they be to arrangements, such as paying $30-$40 a month? What do you suggest we do in response to this? Thank you in advance!

[Aleron]

Hi!  Sorry to hear that you are having a tough year.  You really have a few options.  First of all, did you receive just one letter from the out-of-state attorney?  It must contain several legal warnings to be legal otherwise you can recover damages from that attorney.  Your best bet is to call, explain the situation and offer to pay $40.00 per month.  Most decent collection attorneys(of which I was one) would accept that offer.  One thing in your favor is that Texas is not a very friendly place to sue debtors.  Since the attorney has now threatened to refer this case for immediate suit, he/she has an obligation.  Since they obviously have your correct address, it is a violation of federal law to threaten a lawsuit and then fail to file that suit within a reasonable time.  What is a reasonable time?  I have no idea.  Essentially, a collector(or collections attorney) cannot threaten to take an action that they do not intend to take.  Since they have threatened to have a suit filed, they must follow-through on that threat.  With a balance of $261.00, it is unlikely, although not impossible, that they really intend to file.  If they don't, you can then sue them for $1,000 plus attorneys fees.

To summarize, best bet is to call and offer monthly payments.  You do owe the money and I believe that people should pay their debts to the best of their ability.  If they refuse to accept monthly payments, send them a certified letter requesting that they cease all further communication with you.  Wait about six months and, if you haven't been sued, retain a consumer rights attorney to sue the firm for you.  Be sure to save ALL letters that you receive regarding this debt and make notes about all phone calls.  Also save copies of any letters you send to the firm and the certified mail receipt/green card.

I apologize for being so long-winded but better to give you more information than not enough.  Hope this helps!