Legal Question in Credit and Debt Law in Illinois
Interest on judgements?
I have a medical bill from 9 years ago, after 1 year the hospital sent it to an attorney because, they told me at the time, any bills that take more than 1 year to pay they autimatically send. I made payment arrangments with the lawyer, and have been paying as much as possible over the past 5 years. I recently discovered that the lawyer is charging me interest and monthly fees. The principal was2104.91 I have paid 1590.00 but they say I owe 1974.23 now. I recieved in the mail a notice of hearing of indirect civil contempt. I have been paying as much as I can, but the debt is just growing. Can they legally be charging interest? The hospital doesn't on their bills. I don't have a job, no vehicles in my name or a home in my name. I don't have a checking account only a savings with $8 in it. Can they put me in jail? Is there anyway to stop the interest and extra fees they keep adding on?
2 Answers from Attorneys
Re: Interest on judgements?
Whether they can charge interest or not depends on whether there is a written agreement to do so. The only way you can go to jail is if you ignore a court order. You cannot go to jail simply for not paying your bills. If there is a hearing on contempt, a judgment must have been entered against you at some point. Go to the hearing--failing to do so may be considered contempt of court.
Since this was sent to an attorney for collection, that attorney must comply with the Fair Debt Collection Practices Act.
Re: Interest on judgements?
Judgment creditors are allowed to charge 9% interest per year, so yes, they can charge you interest. Additionally, they are also grated court costs, so I imagine that would account for any other additional fees. If you have been paying pursuant to a payment plan and can prove it, I do not see how you have anything to worry about, but I'm guessing they filed this because you ceased to make payments pursuant to the payment plan?
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