What should I do if someone refuses to repay money they owe me?
Lending money to a friend, paying a contractor who never finishes the job, or covering a roommate’s share of the rent can put you in an uncomfortable position. If the other person won’t pay you back, start with a clear record and a calm request. You may be able to resolve the problem without going to court.
First, make sure you can show what was agreed
Gather anything that shows the money was a loan or an amount the person agreed to pay: a signed agreement, text messages, emails, payment-app records, bank statements, invoices, or notes about when repayment was due. Write down how much is owed and how you calculated it.
For example, if you sent a friend $800 and their text says, “I’ll pay you back next month,” save both the transfer record and the text. Evidence matters because a payment alone may not show whether the money was a loan or a gift.
Ask for repayment in writing
Before taking formal action, send a polite, specific message. State the amount owed, why it is owed, and a reasonable deadline for payment. Keep a copy. If the person cannot pay all at once, you might offer a payment plan—but put the dates and amounts in writing, and confirm what happens if a payment is missed.
If informal reminders fail, consider a demand letter: a written request for payment that explains the debt, gives a deadline, and says you may consider legal action if the matter is not resolved. Stick to facts. Don’t threaten to report a crime, ruin someone’s reputation, or take legal steps you have no intention of taking.
Decide whether court is worth it
If you still aren’t paid, small claims court may be an option. It is designed for disputes involving relatively modest amounts, often without a lawyer. Dollar limits, filing fees, procedures, and rules about where to file vary by state and sometimes by county. Your local court’s website should explain the process.
Before filing, ask yourself two questions: Can I prove the person owes the money? And, if I win, is there a realistic way to collect it? A court decision in your favor is called a judgment. It establishes that the person owes you money, but the court usually will not collect it for you.
Depending on state law, collection options may include taking money from wages or a bank account through a legal process. Some income and property are protected from collection, and additional fees may apply. If the person has little income or few assets, you might win but still have trouble getting paid.
Pay attention to deadlines and alternatives
Every state has a statute of limitations—a deadline for filing a lawsuit. The deadline can depend on the type of agreement and other facts, so check your state’s rules promptly rather than assuming you have plenty of time.
Court is not your only option. Mediation uses a neutral person to help both sides reach an agreement. It can be useful when you want to preserve a relationship or the disagreement is about the terms, not just whether payment is due. Some courts offer low-cost mediation.
If the amount is substantial, the facts are disputed, or the borrower has filed for bankruptcy, consider talking with a lawyer. Bankruptcy can pause collection efforts and affect whether you can recover the debt.
The practical starting point is simple: preserve your records, make one clear written request, and weigh the cost of pursuing payment against what you are likely to recover.
