Juggling the bills can cause a lot of anxiety when there is not enough money to pay them all every month. This can be especially true if you are not sure what will happen when you don't pay a bill. Late or unpaid bills can result in different actions being taken by the company who is owed money and it may depend on what type of company that is.
What Happens When You Don't Pay a Bill for Monthly Services?
When you do not pay a bill for monthly services such as water, gas, electric, internet, or telephone services, the company will eventually shut off the service. If it does this, it may also add additional fees, such as reconnection fees, that you will have to pay in order to have the service turned back on. Most service companies will not shut off your service for one late bill, and will give you a date, shortly before or after the next month's bill is due, by which you must pay in order to keep your service on. Sometimes utility companies will work with you to help you catch up your bill without having your service disconnected, so if you have a bill you cannot pay on time, it is best to call the company and ask if there are any options for extending the due date or the disconnect date.
What Happens When You Don't Pay a Bill for a Loan or Mortgage?
Eventually a loan or mortgage company will sue you in order to collect on a past due account or foreclose on any property that is secured by the loan or mortgage. This can take several months and the lender may be willing to modify or restructure the loan instead of filing a lawsuit as long as you contact them as soon as you become unable to make timely payments. Once a lawsuit has been filed, it may be more difficult to get the bank or loan company to work with you, so it is best if you contact them as soon as the account becomes delinquent.
What Happens When You Don't Pay a Bill to a Credit Card Company?
Most credit card companies will begin calling you to attempt to collect on a past due payment a few days after they are due and unpaid. Eventually they may sue you and attempt to garnish your wages. Credit card companies are generally willing to negotiate payment of your debt by lowering your interest rate for a short period of time, not charging late fees for a few months, or settling the entire amount of the debt for less than you owe. If you are being harassed by a credit card company, try negotiating with them first but if that does not work you should consider hiring a consumer protection lawyer to help you. An experienced consumer protection lawyer may be able to negotiate a repayment plan or settlement of the account and can advise you of any violations of consumer protection laws that the credit card company may have committed.
What Happens When You Don't Pay a Bill to a Doctor or Hospital?
The majority of healthcare providers who are owed money by consumers begin their collection process by sending bills marked “past due” or showing 30, 60, or 90 day past due columns. Many of them will ultimately turn your account over to a collection agency who may file a lawsuit if the amount owed is enough to make a lawsuit financially feasible. If they file a law suit and obtain a judgment against you, they will likely take the steps necessary to begin garnishing your wages if you do not make other arrangements to pay the judgment. If the amount past due is not enough to warrant the time and expense of a lawsuit, the collection agency will simply call and write letters attempting to collect on the debt. This can be become quite annoying and the company may violate consumer protection laws in their attempt to collect the debt. If you feel you are being harassed by a collection agency, you should contact a consumer protection lawyer to help you determine if you have a claim against them and to make them stop their harassment.
Consumer Protection Laws
Anytime a bill goes unpaid, the consumer becomes subject to collection efforts of the creditor or a debt collector. These efforts almost always entail phone calls that can become abusive. The federal Fair Debt Collection Practices Act (FDCPA) was enacted to help protect consumers from unfair, deceptive, and abusive practices of debt collectors when attempting to collect a debt. The Act is federal, so it applies to consumers in every state; however it only applies to debt collectors (collection agencies) and does not generally apply to original creditors who attempt to collect on their own past due accounts. Many states have consumer protection laws that do apply to creditors and these laws oftentimes mirror the FDCPA in the practices that are prohibited. Under the FDCPA, a debt collector may not:
- Call a consumer before 8:00 a.m. or after 9:00 p.m.
- Allow a consumers phone to ring continuously in order to annoy them
- Use profane or obscene language
- Threaten to have a consumer put in jail for not paying a bill
- Make false representations regarding the amount owed or the legal status of the debt
- Threaten to take any action it cannot legally take
This is just a partial list of what the Act prohibits debt collectors from doing and any collection tactic that is deceptive, abusive, or unfair may give a consumer a claim under the Act. Not only can a claim stop the debt collector from contacting the consumer, but it may also result in the debt collector having to pay the consumer for its violations.
If you are being harassed by a debt collector please contact our office for a free, no obligation consultation at 1-800-219-3577.