Can they put a lien on my house?

Question

I took a personal loan to fix a furnace. My financial circumstances changed for the worse so I can't pay what they want me to pay. Despite this, I have been consistently paying whatever I am able each month. I am not trying to dodge my bills,just making smaller payments. Despite that, I was sent to collections and I sent a cease and desist (certified receipt requested) stating I am paying and will continue to pay my original creditor, which is true(I have proof of payments and sent another payment directly to my creditor when I wrote to the collection agency). I just think collection agencies can damage your credit worse than original creditors and this is my only debt. My mortgage and everything else is in good standing. The thing is, I am trying to sell my house so I can move free some monies and get a better paid job to get out of the whole but I won't be able to afford moving if I have to pay first. Can they put a lien on my house or will they most likely garnish my wages?

Answer 1

I think you should call the lender & ask why they sent you to collections if they are continuing to accept your payments.  If I'm not mistaken, if they accept the smaller payments & you continue to make your best effort they have to continute to accept your payments.  The worst that can happen is you'll get a warrent in debt & if you go before a judge they will rule in your favor as long as you show them documentation of your efforts.  In this time of crisis for all of us, hold your head up, you're doing the best you can with what you've got to work with.  Besides, with a newly renovated furnace you have a selling point for your home.  Good luck to you - hang in there...

Answer 2

You will get a summons if they sue, or should I say when they sue.  Your cease and desist letter may force them to sue instead of working out a payment arrangement.

You should show up in court.  However, not being able to sell the house or get a better job won't make any difference.  You owe the debt and the collector will win the judgment.  They can then go after your bank account and garnish your wages -- they will look for cash first but if the amount is large enough, they will also lien the house.

Answer 3

You could try you state's attorney general site for help.  There are local agencies also that should be able to help.

Try doing a search for "consumer rights", "consumer advocates" in your area.  Both the furnace company and the collection agency have to be licensed, often both at the state and local level.

I added a couple of sources as a general guide.  You may need to find ones for your area.

They can threaten you with a lot of things, but they cannot necessarily carry them out.  You have more rights than you realize.

Answer 4

Unless you signed something giving them the right to file a lien, they have to sue you, win and get a judgment against you in order to file a lien against your real property.

Answer 5

Anytime you have work done to your house like remodeling, A/C, furnace, or water heater work or replacement the contractors can put a lien on the property until it is paid in full. Once paid you can have the lien removed.

You have a couple of options. You can sell the home maybe for a little more and pay it off. See if the buyer will give you a credit to pay it off, or offer a lower lump sum amount and see if they will take it. Of course you could just stay in the home and keep making payments.

If you don't owe to much and have a job you may consider a credit card or personal loan to get it paid off as well.

Hope this helps.