Legal Question in Credit and Debt Law in Pennsylvania

loan default

I loaned $2500 to a ''friend'' about 1 year ago. I wrote up a contract which stated that the money be repaid in 16 equal installments of around $157 a month. I had the contract signed by both parties infront of a notary. Well, a year has passed, and I have received a total of $160. What can I do? Also included in the contract was the fact she would be responsible for all court and legal fees if I had to take it to court in order to collect the money. She has a job, but as a waitress. If I go to court to collect the money, she is going to say she doesn't have enough income, since she doesn't report her tips. Am I basically stuck with this debt? Is it worth paying court and legal fees if I have little or no chance of repayment?


Asked on 9/19/07, 4:52 pm

2 Answers from Attorneys
Solomon Weinstein Solomon Weinstein, Esquire

Re: loan default

You can file a suit in small claims court. You should probably file with the court where your friend lives. The court costs should not be much and you should be able to prevail and have the court costs added to the amount owed. You can do it without an attorney.

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Answered on 9/19/07, 5:17 pm
Roger Traversa Arjont Group (Law Office of Roger Traversa)

Re: loan default

You asked about collecting a debt.

Sorry to hear how much she values her friendships. But luckily you were smart enough to get the agreement in writing. Take her to small claims. The fees are small and you stand a very good chance of collecting. If you have the time and are up for some learning do it yourself. It is a very educational experience. If not, then hire and attorney and let him/her collect for you. The fees will be collected as part of the settlement or judgment and should not be significant for this matter.

Collection is easy because she gets some sort of paycheck from her employer. Also, waitresses tips can be assumed and are included against any potential garnishment. Further, she probably has a car, bank account, jewelry, or other assets to seize. Don't let her get away with this and don't give her any warning. Just unleash the dogs and see if she responds.

Regards,

Roger

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Answered on 9/19/07, 6:55 pm


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