One of the most common-held, mistaken beliefs about the law is that a debtor in default can pay a nominal amount to a creditor, and the creditor is required to accept the nominal payment and is forbidden from using any other process to collect from the debtor, such as suit.  This is not true.  In most instances, when a debtor defaults (usually by missing a payment or by making a late payment), the creditor is allowed to accelerate the remaining debt, making it all payable now.  In those cases, once acceleration has been triggered, the creditor can demand the entire remaining debt as due.  A creditor may accept partial payments without waiving the acceleration.  Even if the creditor is not able to accelerate the debt, if the debtor is behind, they are still in default and susceptible to collection procedures, including suit. In fact, each payment made moves the statute of limitations period farther and farther into the future.

In some cases, arguments can be made using theories such as “estoppel” and “course of dealing” to defend against the collection, however, these theories are usually not applicable because of the wording of the contract in question.

When dealing with aggressive collectors, it is always best to seek competent legal advice regarding one’s rights and options from a lawyer who is well-versed in consumer law.

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