What Happens if My Debt Goes to a Collection Agency and I Still Don't Pay?

When you are faced with a debt that you cannot afford to pay, your creditor will often turn it over to a collection agency. At that point, the collection agency will try to get the money from you, but you may still be unable to afford the debt. If you do not pay, the collection agency could take further action.

Contact

If you do not pay your debt to the collection agency, it will start to contact you more frequently. The collection agency can call you and send you statements in the mail. The collection agency can even contact you at work unless you specifically say that it is not allowed. The collection agency cannot call you at inconvenient times such as before 8 in the morning or after 9 at night. If the collector calls before or after those times, it is considered harassment, according to the Federal Trade Commission, the agency that enforces the Fair Debt Collection Practices Act.

Lawsuit

If you continue to avoid paying your bill to the collection agency, you could eventually find yourself in a lawsuit. The collection agency has the right to sue you to collect the debt. When this happens, you will be summoned to appear in civil court on a specific day. Unless you can prove that you do not owe the debt, the collection agency will typically get a judgment against you. The collection agency can then use this judgment to get the money.

Enforcing the Judgment

After the collection agency gets a judgment against you, it can enforce it in several ways. It could allow you to set up a payment plan or it could start garnishing your wages. Another option is to levy your bank account or your personal property. If the creditor takes your personal property, it can then sell it to settle the debt you owe. When the creditor takes money out of your bank account, it can take any amount.

Working Out a Solution

In many cases, the collection agency may not want to file a lawsuit against you because it will have to hire a lawyer and share the amount it collects. Because of this, you can often negotiate with a debt collection company to pay off your debt. In many cases, the collection agency will accept less than you owe. The collection agency may have purchased your debt for much less than the full amount and could be willing to negotiate.