Ignore the second answer – it’s a scam.

I agree with the first poster that you are being brow-beaten to pay more than you can.

Regarding the auction — make sure that the amount that they received for the car was a fair market amount. I have read where courts have been upset with companies that auction cars for less than what you could sell it at a private sale. Collection agencies/banks must auction cars that they repossess and earn as much as they can from the sale. If they sold you car for far less than what it was worth, you might be able to ask that the difference be applied to what you owe.

For example. Say when your car was repossessed it was worth $10,000. If the car was sold at auction for just $2000, you could demand that the collection agency credit you part of the difference because they obviously didn’t do their job in selling your car for a decent amount.

This can be helpful to you if they sue you, and they will sue you, especially if you owe a lot left on the car.

I don’t know what the rest of your financial situation, but have you talked to a bankruptcy attorney? An automatic stay from the bankruptcy filing can protect your from law suits.

But basically, they are trying to scare you. I would simply make payments that you can afford to make. Send money orders. Document the dates that you mail them. Keep copies of the payments and get copies of the canceled money orders after they are cashed. Also, never ever ever give your banking details or debt card number to a collection agency. Don’t do business with them over the phone. Remember, that promises made over the phone will not preserve your rights. Get everything in writing.

Will they sue you after one month? They can, but I would say that they are trying to check you out. They are probably monitoring your credit, seeing if you will purchase a new car or buy a home. Some collection agencies are stupid, others aren’t. But many of them will sue to ensure a judgment – that way, if you ever do get out of debt and have money, they can enforce a judgment. Also, judgments can lead to wage garnishments, which you probably want to avoid. Again, if you’re swimming in debt and don’t think you can pay off this car in the next 3 years, you might want to talk with a bankruptcy attorney about your options.

Good luck!

scare tactics, just pay what u can