Legal Question in Credit and Debt Law in Wisconsin
A couple questions on credit debt collection.
First question: I have a telephone conversation with a lawyer representing a creditor in which I arrange a payment plan. The plan is to make monthly payments by the 20th of each month. I make six payments on time, but then make the seventh payment three days late. The firm to which the payments were sent cashed the check and applied it to the outstanding balance, then proceeded to bring a lawsuit against me in small claims court for failing to adhere to the agreed upon payment schedule. My question is: having accepted the payment, can the firm then turn around and use it as basis for legal action? And, in the statement I recieved after making this payment, I see that they've added $100 to my balance to cover the cost of filing this lawsuit. Can they convey these costs to me when the outcome of the suit hasn't yet been decided?
The second question is a simpler one. If I was to be sued in small claims court by a Texas-based creditor, would the suit be filed there in Texas, or in Wisconsin where I am?
Thank you.
1 Answer from Attorneys
Re: A couple questions on credit debt collection.
If you have a written forebearance agreement with a creditor and are substantially in compliance with it, you should raise that defense in the collection suit.
As to your other question, a valid Texas judgement against you would be given full faith and credit by the WI courts and may therefore become enforceable against you.
The final question you should ask yourself is whether fighting all these problems on a piecemeal basis is really worth it, when structural solutions to most of your creditor problems such as bankruptcy are available to you. You should discuss your problems with a bankruptcy attorney or a debt counsellor.
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