When struggling financially, you may find yourself juggling and trying to prioritize bills. That's when you start hunting for the ones with the easiest payment terms or hoping to get as much time as possible to deal with an outstanding balance. While it might be comforting to think the law provides you protection, it takes very little stand in regard to how much time you have to pay a bill. Terms of payment are rooted in the contract -- written or oral -- between you and the person or entity you owe.
Bills are centered in contract law. Courts generally enforce whatever you and the business to which you owe money decide for payment terms. So, if you have a written, signed agreement for payment terms or monthly billing cycles, the law expects you to live up to them. Most vendors, credit accounts and billed utility services have expressly written terms when you begin doing business. Keep anything you sign for your future reference. Additionally, if receipts or sales documents list payment terms, you accept those terms when you receive goods or services even if you don't sign.
Because agreements govern the terms of a bill, the amount of time you have to pay can be changed simply by agreeing to modify the terms. If a company is willing to work with you on terms that are more manageable, you can extend your payment times. If you are able to arrange better billing and payment terms, ask for something in writing that gives you proof.
If you begin receiving invoices from a company for past due payments, that means it has initiated the collections process. Although laws vary by state and there are exceptions, three unpaid bills or invoices typically establishes a legal claim that can be used in court. Alternatively, a company may pass the unpaid bill along to a collections agency. Usually, collections agencies can and will change payment terms if it facilitates a full payment. Let collections agents know what you are able to pay and you may get the terms you need.
Although it can feel overwhelming to receive collections notices and invoices, talk to the entity you owe and try to make at least partial payments. Document all communications. If the other party proves inflexible and sues you, you'll want to show your good faith effort to pay what you could as well as the other side's inflexibility. Judges can consider the intentions and actions of both sides when deliberating.
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