My Local Community College Says I Owe Them Money but I Can’t Afford to Pay


Dear Steve,

I was just informed about a student debt owed to my community college. Upon receiving the letter, I contacted the college and they informed me it was transferred to a collection agency. I honestly can’t come up with the funds at the moment. Is there any way to have student debt reduced? It’s been over 1.5yrs since I’ve last attended.

Look forward to hearing from you.

Thank you,



Dear Abigail,

So it sounds like this is money due to the college and not instead of something like a student loan. If that is the case this is a consumer debt like when you owe a debt to someone.

The only big consequence I can see here is if you wanted to get your transcript from the college. They don’t have to release it as long as you have an outstanding balance.

With a consumer debt, you have two primary ways of reducing the balance you owe.

The first is if you negotiated a settlement agreement where you paid less than the full balance due to satisfy the total amount you owe. But you should anticipate they will want the settlement amount in one payment. Some will accept monthly payments but you have to come to a mutual agreement on the payment and payment that would be acceptable.

The second way is through consumer bankruptcy. A Chapter 7 bankruptcy would eliminate your debt owed to the school and also free your transcript if it is being withheld because of the balance owed.

You can click here to find a local bankruptcy attorney and talk to them for free about your specific situation. Get the facts and then you can make an informed and educated decision if bankruptcy is right for you.

The third way, of course, is to pay the balance off in full. But then you would not have contacted me if you could do that.

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If you can’t afford what the collection company is demanding then you have to be honest about that with them. Overpromising and underdelivering only lands you in hot water.

What should I do if a creditor or debt collector sues me?

If you’re sued by the debt collector, respond to the lawsuit. You can respond personally or through an attorney, but you must do so by the date specified in the court papers.

When you respond to, or “answer,” the lawsuit, the debt collector should have to prove to the court that the debt is valid and that you owe the debt. You might have to push them to do so.

If you ignore a court action, it’s likely that a judgment will be entered against you for the amount the creditor or debt collector claims you owe. Often the court also will impose additional fees against you to cover collections costs, interest, and attorney fees. A judgment can lead to a wage garnishment.

Don’t Let it Get to a Lawsuit

You’ve taken a great first step in reaching out for help and advice. Just keep your head out of the sand and keep dealing with attempting to negotiate a solution or take action, like bankruptcy if that makes sense for you.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

Do you have a question you'd like to ask me for free? Go ahead and click here.

Damon Day - Pro Debt Coach

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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