Debt Collection for Gym Membership

Canceling a gym membership isn't as hard as climbing Mount Everest, though it can feel pretty close. Fitness centers and gyms are notorious for complicated contracts that require members to jump through numerous hoops to cancel. 

If you walk away from a gym membership before it expires, you could still be on the hook for the rest of the fees. If you don’t pay, your gym could send the debt to collections. You can't go to jail for an unpaid gym membership, but owing this kind of debt can be a pain. 

You may have some debt relief options if you're worried about paying old gym fees. Let's look at how gym fees can wind up in collections and your options for getting rid of the debt.

Can Gym Memberships Go to Collections?

Gym memberships can go to collections if you don't pay, just like pretty much any other debt. This may not happen until an account balance has gone unpaid for an extended period. For example, if 90 days go by and you haven't paid, your gym might send the account to internal collections, or sell it to a debt collector. 

How does a gym membership end up in collections anyway? After all, most gyms require automatic billing to make sure they get paid, right?

That's true, but if you cancel your gym membership through the proper channels, the gym is supposed to stop automatic payments. If you have any remaining fees owed for the rest of the contract when you cancel, you could end up with a balance due. 

You could also have gym debt in collections if you don't cancel the contract, but stop making payments. That can happen if you close the bank account, debit card, or credit card attached to your gym membership and don’t update your payment information. Either way, the gym can send your account to collections to try to get you to pay. 

Can You Be Sued for Gym Debt?

If you sign a contract for a gym membership that includes an agreement to pay a set amount and you don't hold up your end of the bargain, the gym could sue you. A gym probably won't sue right away; you'll likely get collection calls or letters first. 

If you still don't make arrangements to pay, a debt lawsuit could be next. Here's what typically happens if you're sued for an unpaid gym membership:

• You receive a summons from the court that tells you you're being sued, by whom, for what amount, and when the court hearing will be held. 

• You need to submit an answer to a summons to the court, explaining your defense against the claim. 

• If you go to court on the scheduled date, you'll have a chance to make your case before a judge. The case ends when the judge rules in your favor or the gym's. 

• If you ignore the summons or don't go to court, the judge could rule in favor of the gym automatically (this is called a default judgment). 

Should the gym win its case, it might ask the judge to order a wage garnishment or bank account levy. If your wages are garnished, your employer must withhold some of your earnings every pay period until the debt is paid off. A bank account levy is a court order that allows creditors to take money from your account to satisfy debts. 

Can Unpaid Gym Memberships Hurt Your Credit?

An unpaid gym membership could hurt your credit if the account goes to collections. Collection accounts can be reported to the credit bureaus and knock points off your credit scores. 

Whether a gym debt has a serious impact on your credit usually depends on the amount—some FICO Score models don't factor collections under $100 into your scores. 

If you're sued for a gym debt, the lawsuit itself doesn't hurt your credit. Judgments are no longer factored into credit score calculations. However, judgments are still part of the public record. If a lender looks at public records when you apply for a loan, having a judgment for unpaid debt on file could hurt your approval odds. 

How to Get Debt Relief for Unpaid Gym Membership Fees

Debt relief refers to strategies and solutions that can help you navigate tough debt situations. The best option for your gym debt will depend on the amount of debt and your resources.

If you can't afford to repay all the overdue gym fees, you might consider:

• Payment plan. Your gym or the debt collector might be willing to work out a payment plan that fits your budget.

• Debt consolidation loan. A new loan could be used to pay off your gym fees (and any other high-interest debt). Then, you repay the loan over a few years with set monthly payments.

• Debt settlement. This is when you negotiate with the gym or the debt collector to accept less than you owe and forgive the rest.

For smaller balances, a payment plan could be the simplest solution. If you owe a lot of past-due gym fees, or have other debts you also need to deal with, then consolidation or debt settlement may be the better options.

Debt settlement can be particularly effective when you have a lot of unsecured debt ($7,500 to $10,000 or more) you can't afford to repay due to financial hardship. You can attempt settlement yourself—which could be easy if you only owe a few hundred in gym fees. If you have a lot of debt you want to settle, consider hiring a professional debt relief company.

Here's how professional debt relief works:

• You make one monthly payment into a secure dedicated account that you own and control.

• Your debt expert negotiates with your creditors on your behalf.

• Once a settlement is reached, you authorize the debt settlement company to use money in your account to pay the creditor.

• The rest of the debt is forgiven. 

You may be able to settle gym debts, credit cards, personal loans, and other unsecured debts for less than what you owe. A debt expert can review your situation and help you decide if settlement makes sense for you. 

Learn more about how debt relief programs work, or get in touch with a Freedom Debt Relief specialist.