Any creditor can sue you if you refuse to pay. If the creditor wins the case, the judge can order you to pay off the full debt plus court fees. In some cases, the court may also order you to pay your creditor's attorney fees. This can leave you owing much more after the lawsuit than before. Thus, if you can afford to pay off your debt before going to court, it's a wise choice.
Avoiding Court
If you agree that you owe the debt and wish to avoid the stress of going to court, nothing prevents you from paying off your debt before the scheduled court date. Your creditor's goal is to collect the debt you owe. Thus, if you are willing to pay it, your creditor will accept it. Once you pay the debt, the creditor will dismiss the pending lawsuit against you. A creditor does not have to dismiss its lawsuit unless you pay your debt in full. By the time a creditor sues you, your opportunity to pay off the balance via a payment plan has already passed.
Payment Amount
While you can pay your past due bills before your court date, don't expect a break on the amount you owe. A creditor that wins a judgment through a lawsuit will force you to pay off the full balance, plus fees. Because your creditor can collect the full balance with its lawsuit, it often has no incentive to settle out of court for a lesser amount.
Your creditor does not want to risk losing its lawsuit. Thus, the company may negotiate with you and let you pay less than you owe if it sees that you plan to put up an aggressive defense in court.
Failure to Pay
If you cannot pay the debt in full by the court date and your creditor refuses to accept a partial payment, the lawsuit will proceed as scheduled. If the judge sides with your creditor, the resulting civil judgment carries considerable negative consequences for your future. State laws vary, but judgment creditors often have the right to force payment through wage garnishment and bank levies. Your creditor can also seize personal property that you own, such as jewelry and electronics, and place a lien against your home or motor vehicle.
Considerations
If you have a valid case for why you should not have to pay the debt, such as the account does not belong to you or the statute of limitations for collecting via a lawsuit in your state has passed, paying before the court date may not be necessary. Seek legal counsel to determine whether or not you are legally liable for the debt or have an affirmative court defense that will help you prevent a civil judgment and the consequences that come along with it.
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