What are the costs and fees for filing a lawsuit to collect unpaid debt in court?

Question

What are the costs and fees for filing a lawsuit to collect unpaid debt in court?

Answer

Collecting unpaid debt in court may or may not be a good idea for a creditor. If other methods have not been used, it would be a good idea to use them. One option is to contact a collection agency or debt collector to see if a third party with more resources than some creditors will be more successful at getting the debtor to pay up.

If all other methods have failed, going to court and filing a lawsuit should be the last resort. Starting a lawsuit has many costs involved such as filing fees, payment for service of process through a process server, legal counsel, etc. The debt amount may be small enough to file in small claims court, reducing these costs.  Smaller debts from local debtors may be easier to collect than larger debts from debtors in other jurisdictions.

Legal counsel and process servers can be expensive. You may want to avoid them but these are two areas that you should not skimp on. Improper service of process can cause a lawsuit to be dismissed, meaning you would have to pay filing fees once again and try to start another lawsuit against the debtor. Not having adequate legal counsel could lead to errors in your paperwork or procedure that prompt a judge to dismiss the lawsuit and cost even more money.

Since it can cost more to file a lawsuit than the amount of the debt, carefully consider if filing a lawsuit will be worthwhile.

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