Niles, MI asked in Contracts, Civil Litigation and Small Claims for Michigan

Q: Can I sue in small claims court for the remainder of a personal loan if the borrower has not made a payment in a year?

I loaned someone $3,000 in 2017. We wrote a contract for this person to repay me within 5 years. I did not require a monthly minimum payment. I did, however, include 7.5% monthly interest (which I later found out is an illegal amount. Monthly interest must be much lower). I wrote the contract in one state, I live in a different state, and the other person lives in yet a different state. Am I able to sue this person in small claims court even though the 5 years is not up? They have only made $500 in payments since 2017. They have not made any payments in the last year. If so, which state should I sue in? The state the contract was drafted in? The state I live in? Or the state they live in?

1 Lawyer Answer
Brent T. Geers
Brent T. Geers
  • Grand Rapids, MI
  • Licensed in Michigan

A: You may have a claim. You would quite likely need to file in the state where the contract was entered.

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