Unemployed, Pregnant, and Can’t Afford the Payments – Erin

“Dear Steve,

Unemployed, pregnant, and cant afford the payments demanded by the debt collectors.

I am trying to make the demanded payments by the debt collectors, with out defaulting on my car payment, insurance, and medical bills. Do I have to send the collection agency the payment they are demanding, or can I send what little I can afford without the threat of being sued?


I asked my friend Mike Killian to answer your question for you. I wanted to make sure you got an answer as quickly as possible as I’m a bit backed up at the moment. I’ll be watching the comments on this question and be around to help if you need me.

Dear Erin,

It certainly does look like you have your hands full. Let me offer you a few words and see if I can assist. There really is little connection between defaulting on you car, car insurance or medical and what you pay the collectors. There is a matter of debt priority and it looks like you have selected your priorities and that is awesome. If you paid the collectors $0, it would not affect your medical, car payment or car insurance… unless you tried for a new loan. On the other hand, it is always advantageous to pay at least a small amount to a creditor. If taken to court, it shows a judge good faith on your part. It will not be acceptable to the collector to pay less than they desire, but we are concerned with your well-being and not their feelings.

All of the above being said, there will be some fallout. Clearly it will affect your credit report as late payment but I suspect your credit report has lates on it already if you are dealing with collectors. The other issue is, it will create harassing phone calls and letters to you. But writing to them and demanding them to cease and desist further contact, can stop this harassment. I recommend sending the letter with a return receipt to have proof it was received. By law they can no longer make contact with you except to inform you of legal action or that they are dropping the issue.

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This then is the short-term solution because those creditors will probably attempt legal action. However at that stage you should contact an attorney. Initial consultation is usually free. If you elect to file bankruptcy your attorney can reaffirm various debts including your car and medical should you so choose and the bankruptcy will not affect them.

Do You Have a Question You'd Like Help With? Contact Debt Coach Damon Day. Click here to reach Damon.

Your attorney will be contacting your debtors for you once you file. He will send them a notice of cease and desist except to those debtors you want reaffirmed. Therefore there is no need for you to write those letters if you are going to be filing immediately.

As a final note, you may want to check into your local social services as far as medical for yourself in your pregnancy. They may have resources available for you that could help.

Good luck to you and yours



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Mike Killian is founder of Learning Credit and Debt Management. He has been writing and teaching about credit and debt management issues for over 12 years. His articles have been referenced by various members of the media, including MSNBC and The Motley Fool. Mike has also offered debt elimination seminars to businesses and community colleges for many years.He has an MS in counseling and is a nationally certified as a Personal Finance Counselor. Mike can be found at LearnCreditManagement.com/.