Use this debt collection guide to build a clear demand letter for Spokane.
Spokane Debt Collection: Your Complete Guide to Collecting Money Owed
When someone owes you money and refuses to pay, you have legal options to collect. Whether it is an unpaid loan to a friend, an outstanding invoice from a client, rent owed by a former tenant, or any other legitimate debt, Washington State law provides mechanisms to recover what you are owed. This comprehensive guide will walk Spokane residents through the debt collection process, from initial demand letters to court judgments and enforcement.
Collecting debts can be frustrating. Debtors often make excuses, avoid communication, or simply refuse to acknowledge their obligations. However, understanding the legal process and following proper procedures significantly increases your chances of recovery. Washington law provides creditors with powerful tools including small claims court, wage garnishment, and bank levies, but these tools must be used correctly.
This guide covers the legal framework for debt collection in Washington State, the step-by-step process for pursuing payment, and the specific resources available in Spokane County. You will learn how to document your claim, send effective demand letters, file suit in Spokane's courts, and enforce judgments against reluctant debtors.
Whether you are an individual owed money by an acquaintance or a small business with unpaid invoices, the principles are the same. Document the debt, demand payment formally, and be prepared to pursue legal action if necessary. With persistence and proper procedure, most legitimate debts can be collected.
Washington Debt Collection Laws: Your Rights in Spokane
Washington provides a legal framework for creditors to collect legitimate debts. Understanding these laws helps you pursue claims effectively and within legal bounds.
**Statute of Limitations**
The statute of limitations determines how long you have to sue for a debt. Key Washington deadlines include:
- **Written contracts**: Six years from breach under RCW 4.16.040
- **Oral contracts**: Three years under RCW 4.16.080
- **Open accounts**: Six years for accounts based on written agreement
- **Judgments**: Ten years from entry, renewable under RCW 6.17.020
Once the statute of limitations expires, you cannot sue to collect the debt. The clock starts when the debt became due or when the debtor last made a payment.
**Interest on Debts**
Washington allows creditors to charge interest on debts. Under RCW 19.52.010, the legal rate of interest is 12% per year when no rate is specified in the agreement. Contract rates above 12% may be permitted if properly agreed to in writing. Prejudgment interest on debts accrues from when the debt became due.
**Collection Regulations**
If you are collecting debts as a business or through a third party, Washington has regulations that apply. The Washington Collection Agency Act (RCW 19.16) requires licensing for collection agencies and prohibits certain abusive practices. The federal Fair Debt Collection Practices Act (FDCPA) applies to third-party collectors. These laws do not directly apply to individuals collecting their own debts, but understanding them provides guidance on ethical collection practices.
**Exemptions from Collection**
Even after obtaining a judgment, certain debtor assets are exempt from collection under RCW 6.15:
- **Homestead exemption**: Up to $125,000 of equity in the debtor's primary residence
- **Personal property exemptions**: Clothing, household goods, and certain personal items
- **Wage exemptions**: The greater of 75% of disposable earnings or 35 times state minimum wage is exempt from garnishment
- **Retirement accounts**: Generally exempt from collection
Understanding exemptions helps you assess whether the debtor has collectible assets.
**Attorney Fees and Costs**
Whether you can recover attorney fees depends on your agreement and the type of claim. Many contracts include attorney fee provisions allowing the prevailing party to recover legal costs. Under RCW 4.84.330, attorney fees are allowed if provided in the contract. Without a contractual provision, each party typically pays their own fees.
**Small Claims Court**
Washington small claims court handles claims up to $10,000. This provides an accessible forum for collecting smaller debts without attorney involvement. In Spokane County, small claims cases are heard in District Court.
**Judgments and Enforcement**
Once you obtain a court judgment, you have powerful collection tools:
- **Wage garnishment**: Continuous or one-time garnishment of debtor's wages
- **Bank levies**: Seizure of funds in debtor's bank accounts
- **Property liens**: Lien on debtor's real property
- **Personal property execution**: Seizure and sale of debtor's non-exempt property
Judgments are valid for 10 years and can be renewed.
Step-by-Step Guide to Collecting Debts in Spokane
**Step 1: Document the Debt**
Before taking any action, gather all documentation proving the debt exists. Collect: any written agreement, contract, or promissory note, invoices or billing statements, records of goods or services provided, communications acknowledging the debt, payment history showing amounts paid and owed, and calculations showing current balance with any interest. The stronger your documentation, the better your chances of collection.
**Step 2: Verify the Amount Owed**
Calculate the exact amount owed including principal, interest (if applicable), and any fees permitted by your agreement. Create a clear accounting showing how you arrived at the total. If the debtor disputes the amount, having detailed calculations is essential.
**Step 3: Send a Written Demand**
Before taking legal action, send a formal demand letter. The letter should identify the debt (original amount, dates, purpose), state the current amount owed including any interest, demand payment by a specific deadline (typically 10-14 days), offer to discuss payment arrangements if appropriate, and warn of legal action if payment is not received. Send via certified mail with return receipt for proof of delivery.
**Step 4: Follow Up**
If the debtor does not respond to your initial demand, send a follow-up letter after the deadline passes. Reiterate your demand and your intent to pursue legal remedies. Sometimes persistent follow-up prompts payment. Document all communication attempts.
**Step 5: Consider Negotiation**
Before filing suit, consider whether negotiation makes sense. Some debtors genuinely cannot pay the full amount but will pay something. A payment plan or reduced lump-sum settlement may recover more than protracted litigation against someone with few assets. Any settlement agreement should be in writing.
**Step 6: File in Small Claims Court**
For debts up to $10,000, file in Spokane County District Court (small claims division) at 1100 W Mallon Ave. The process involves: completing the claim form, paying the filing fee ($35-75 depending on amount), serving the defendant with the claim, and appearing at the scheduled hearing. Bring all documentation proving the debt.
**Step 7: File in Superior Court**
For debts over $10,000, file in Spokane County Superior Court. This is more complex and typically requires an attorney. You will file a complaint, serve the defendant, potentially go through discovery, and proceed to trial if no settlement is reached.
**Step 8: Obtain Your Judgment**
If you win in court, the judge will enter a judgment in your favor specifying the amount owed plus any interest and costs. Get a certified copy of the judgment for enforcement purposes.
**Step 9: Collect on the Judgment**
If the debtor does not pay voluntarily, use legal collection tools. Options include wage garnishment (through the debtor's employer), bank levy (seizing funds in debtor's accounts), property lien (filing against debtor's real estate), and personal property execution (seizing and selling assets). The Spokane County Sheriff assists with enforcement.
**Step 10: Renew Judgment if Necessary**
If you cannot collect within 10 years, renew the judgment before it expires. Some debtors eventually acquire assets or become more collectible over time.
Essential Evidence for Spokane Debt Collection Claims
Strong documentation is essential for proving your debt claim. Courts require evidence that the debt exists, the amount is correct, and the debtor is obligated to pay.
**Contract Documentation**
The best evidence of a debt is a written agreement. Gather: signed contracts or promissory notes, loan agreements with terms specified, written purchase agreements, invoices accepted by the debtor, and terms and conditions acknowledged by the debtor. If there is no written agreement, gather any writing showing the debtor acknowledged the obligation.
**Transaction Records**
Document the underlying transaction: records of goods or services provided, delivery confirmations, work completion documentation, receipts or invoices sent, and bank records showing funds transferred to the debtor. These records prove you provided something of value that the debtor was obligated to pay for.
**Payment History**
Maintain records of all payments: check images or bank statements showing payments received, payment ledger tracking amounts received and dates, receipts given to the debtor, and accounting records showing current balance. Payment history helps establish the amount currently owed and can reset the statute of limitations.
**Communications**
Save all communications with the debtor: emails discussing the debt, text messages, voicemails (transcribed), letters sent and received, and notes from phone conversations (with dates). Communications often contain admissions of the debt or promises to pay.
**Demand Letters and Responses**
Preserve your demand letters and any responses: copies of all demand letters sent, certified mail receipts and return cards, any written responses from the debtor, and notes on debtor's verbal responses.
**Calculation Documentation**
Support your claimed amount with calculations: original principal amount, interest calculation (rate, period, method), any fees permitted by agreement, credits for payments received, and running balance showing how total was reached.
**Debtor Information**
Gather information about the debtor for service and collection: current address (verify before filing), employer information (for wage garnishment), bank information if known (for levies), and property ownership (for liens). Public records searches can help locate debtor assets.
Critical Deadlines for Debt Collection in Washington
Debt collection involves several important deadlines. Missing these can eliminate your ability to collect.
**Statute of Limitations**
The clock starts when the debt became due or when the debtor last made a payment or acknowledged the debt in writing.
**Tolling and Restarting the Clock**
Certain actions can affect the limitations period. Payment on the debt restarts the clock from the payment date. Written acknowledgment of the debt can restart the clock. The debtor's absence from Washington may toll (pause) the period. Bankruptcy filing temporarily stays collection and may affect timing.
**Court Filing Deadlines**
Once you file suit, you must meet court deadlines: serve the defendant within 90 days (typically), respond to any motions timely, meet discovery deadlines if applicable, and appear at scheduled hearings.
**Judgment Enforcement Deadlines**
After obtaining judgment: judgments are valid for 10 years under RCW 6.17.020, garnishment orders must be served within 60 days, you can renew judgments before expiration, and liens must be properly recorded and renewed.
**Demand Letter Timing**
Send demand letters promptly after the debt becomes due. While there is no legal deadline, delay suggests the debt is not important to you and may weaken your position. Set reasonable response deadlines (10-14 days) and follow up promptly.
**Interest Accrual**
Interest accrues from when the debt became due (if your agreement provides for interest) or from the judgment date for prejudgment interest awards. Track interest carefully and include it in your claim.
Common Mistakes to Avoid in Spokane Debt Collection
Avoid these common errors that can undermine your collection efforts.
**Waiting Too Long**
The most common mistake is waiting too long to pursue collection. Statute of limitations issues aside, delay allows debtors to move, hide assets, or become less collectible. Memories fade, documentation gets lost, and witnesses become unavailable. Act promptly when debts become overdue.
**Poor Documentation**
Without good documentation, proving your claim is difficult. Verbal agreements with no supporting evidence often fail in court. Keep written records of all debts, payments, and communications from the start.
**Not Verifying Debtor Information**
Filing suit against the wrong address or incorrect name wastes time and money. Verify the debtor's current address before filing. Check that you have the correct legal name (for individuals) or proper business entity name (for businesses).
**Ignoring Statute of Limitations**
Some creditors wait until the statute of limitations has run, thinking they can still sue. Once expired, your lawsuit will be dismissed if the debtor raises the defense. Know your deadline and file before it expires.
**Harassment or Improper Collection Tactics**
Even when collecting your own debt, avoid harassment. Excessive calls, threats, false statements, or other abusive tactics can expose you to liability. Maintain professional communication focused on the legitimate debt.
**Accepting Partial Payment Without Documentation**
If a debtor makes partial payment, document it clearly. Specify that it is a partial payment not full satisfaction. Without documentation, the debtor may later claim the partial payment satisfied the entire debt.
**Not Getting Settlement Agreements in Writing**
If you agree to accept less than the full amount or to a payment plan, get it in writing. Include the original debt amount, the settlement terms, consequences of default, and confirmation that the debtor acknowledges the underlying obligation.
**Failing to Pursue Collection After Judgment**
A judgment is just paper until you collect. Many creditors obtain judgments but never pursue enforcement. Use garnishment, levies, and liens aggressively. Monitor the debtor's situation and act when assets become available.
**Not Renewing Judgments**
Judgments expire after 10 years. If you have not fully collected, renew the judgment before expiration. Failing to renew means starting over with a new lawsuit (if still within limitations).
Frequently Asked Questions About Debt Collection in Spokane
The statute of limitations depends on the type of debt. For written contracts, you have six years from when the debt became due or from the last payment under RCW 4.16.040. For oral contracts, you have three years under RCW 4.16.080. Once the statute expires, you cannot sue to collect, though the debt may still exist.
Washington small claims court handles claims up to $10,000. In Spokane County, small claims cases are filed with the District Court at 1100 W Mallon Ave. You do not need an attorney for small claims court. For debts over $10,000, you must file in Superior Court.
Yes. If your agreement specifies an interest rate, you can charge that rate (subject to usury limits). If no rate is specified, Washington's legal rate is 12% per year under RCW 19.52.010. Interest accrues from when the debt became due.
After obtaining a judgment, you can get a writ of garnishment from the court and serve it on the debtor's employer. Washington limits garnishment to the lesser of 25% of disposable earnings or the amount by which weekly earnings exceed 35 times minimum wage. Garnishment continues until the judgment is satisfied.
You can generally collect from non-exempt assets including bank accounts, wages (within limits), real property, vehicles, and other personal property. However, Washington has significant exemptions including homestead exemption up to $125,000, certain personal property, and retirement accounts. Many debtors have few collectible assets.
Judgments are valid for 10 years from entry under RCW 6.17.020. You can renew a judgment before it expires. If not renewed, the judgment expires and you would need to file a new lawsuit (if still within the statute of limitations).
Attorney fees are recoverable if provided for in your contract under RCW 4.84.330. Without a contractual provision, each party typically pays their own fees. Some statutes provide for fee recovery in specific situations. In small claims court, attorney fees are generally not recoverable.
Bankruptcy filing triggers an automatic stay that halts all collection activity. You must stop collection immediately. Depending on the type of bankruptcy and whether your debt is dischargeable, you may recover nothing, partial payment, or be able to resume collection after bankruptcy concludes. Consult a bankruptcy attorney if this occurs.
What to Expect When Collecting Debts in Spokane
Understanding realistic collection expectations helps you make informed decisions about pursuing debts.
**Recovery Rates**
Not all debts are collectible. Typical recovery depends on debtor circumstances. Debtors with steady employment and assets often pay after judgment, though collection may take time. Debtors with no job, no assets, and no property are often judgment-proof, meaning even winning in court yields nothing. Many collections fall somewhere in between.
**Factors Affecting Collection**
Key factors include: debtor's employment status and income, whether debtor owns property or has bank accounts, debtor's other debts and obligations, strength of your documentation, and size of the debt relative to collection costs.
**Timeline for Collection**
Debt collection is often not quick. Demand letter and negotiation may take 2-4 weeks. Small claims court process takes 2-3 months. Post-judgment collection may take months to years. Some debtors pay immediately; others require persistent enforcement over time.
**Costs vs. Recovery**
Consider costs before pursuing collection. Small claims filing fees run $35-75. Service of process costs approximately $50-100. Superior Court litigation is much more expensive. Attorney fees can quickly exceed small debt amounts. Calculate whether recovery justifies costs.
**Settlement Considerations**
Many debts settle for less than the full amount. A debtor who cannot pay $5,000 may be able to pay $2,500. Accepting a lump sum today may be better than years of collection efforts. Payment plans spread risk but ensure ongoing contact with the debtor.
**Judgment-Proof Debtors**
Some debtors simply have nothing to collect. They have no wages to garnish, no bank accounts to levy, and no property to lien. Against such debtors, even a judgment is uncollectible. However, circumstances change - the judgment remains valid for 10 years and the debtor may become collectible later.
**Collection Agencies**
For debts you cannot pursue yourself, collection agencies are an option. They typically charge 25-50% of amounts collected. This may be worthwhile for debts you would not otherwise pursue. However, agencies cannot collect from judgment-proof debtors either.
Spokane Debt Collection Resources and Contacts
**Courts**
**Spokane County District Court (Small Claims)**
1100 W Mallon Ave, Spokane, WA 99260
Phone: (509) 477-4700
Website: spokanecounty.org/courts
Handles debt collection cases up to $10,000.
**Spokane County Superior Court**
1116 W Broadway Ave, Spokane, WA 99260
Phone: (509) 477-5788
For debt claims over $10,000.
**Enforcement Agencies**
**Spokane County Sheriff - Civil Division**
1100 W Mallon Ave, Spokane, WA 99260
Phone: (509) 477-2521
Assists with service of process and judgment enforcement.
**Government Resources**
**Washington State Attorney General**
Phone: 1-800-551-4636
Website: atg.wa.gov
Information about debt collection laws and consumer protection.
**Spokane County Auditor (Liens)**
1116 W Broadway Ave, Spokane, WA 99260
Phone: (509) 477-2270
For recording judgment liens against real property.
**Legal Assistance**
**Spokane County Bar Association Lawyer Referral Service**
Phone: (509) 327-3700
Website: spokanebar.org
Connects you with attorneys handling collection matters.
**Northwest Justice Project - Spokane**
35 W Main Ave, Suite 300, Spokane, WA 99201
Phone: (509) 324-9128
Free legal assistance for qualifying individuals.
**Washington LawHelp**
Website: washingtonlawhelp.org
Free legal information and self-help resources.
**Skip Tracing and Debtor Location**
**Spokane County Assessor**
Phone: (509) 477-3698
Website: spokanecounty.org/assessor
Public records on property ownership.
**Washington State Department of Licensing**
Phone: (360) 902-3900
Website: dol.wa.gov
Driver records and registered agent information.
The Debt Collection Playbook
Proof is Power
Contracts, invoices, texts, emails… gather all evidence of the debt.
Time is Your Ally (and Their Enemy)
Interest accrues. Late fees may apply. The longer they wait, the more they may owe.
Track Every Penny
Principal, interest, late fees… don't miss a dollar.
The Debtor's Options
Many states allow you to recover collection costs, including attorney fees in some cases. Know your rights.
Washington Debt Collection Laws
Applicable Laws
- FDCPA
- Washington Collection Agency Act - RCW 19.16
Small Claims Limit
$10,000
Consumer Protection Agency
Washington DFI / CFPB
Collection Combat FAQ
When should I send a demand letter?
After the second broken payment promise. Don't let them string you along indefinitely.
What if they ignore my demand?
Small claims court is your next step. The filing fee is often recoverable, and you don't need a lawyer.
How do I prove they owe me money?
Contracts, invoices, text messages, emails, bank transfers, promissory notes, or witness statements all help prove the debt.
Can I charge interest?
Yes, if your contract includes interest terms. Even without a contract, many states allow pre-judgment interest on debts.
What about collection costs?
Many contracts allow recovery of collection costs and attorney fees. Check your agreement and state law.
Is there a time limit to collect?
Yes. Statutes of limitation vary by state and debt type, typically 3-6 years. File suit before the deadline expires.
What if they claim they already paid?
Demand proof. Bank records, cancelled checks, or receipts should show payment. If they can't prove it, they still owe you.
About FreeDemandLetter
FreeDemandLetter provides free, AI-powered demand letter generation with location-specific legal citations. Our content is reviewed by subject matter specialists and regularly updated to reflect current laws. We help thousands of people resolve disputes effectively—but we're not lawyers, and this isn't legal advice. For complex situations, consult a licensed attorney in your jurisdiction.