How to Sue Someone for Money They Owe You

Someone Owes You Money. Here's What to Do About It.

You lent someone money. Or a contractor took your deposit and ghosted. Or a company owes you a refund they keep "processing." Whatever the story, you're sitting there with less money than you should have, and the other person isn't losing any sleep over it.

Most people vent about it, complain to friends, maybe leave a bad review, and eventually move on. That's exactly what the person who owes you is counting on.

But you don't have to accept it. You have real, practical options to get your money back, and most of them don't require a lawyer or a courtroom.

Start With a Demand Letter (Most Cases End Here)

Before you even think about court, send a formal demand letter. This isn't a text message or an angry email. It's a structured, professional notice that tells the other party: pay what you owe, or face legal consequences.

Here's why demand letters work so well: they signal that you're serious. You're not just complaining anymore. You've taken an actual step toward legal action, and suddenly the person who's been ignoring you has to decide whether they want to deal with a lawsuit.

The numbers back this up. About 70% of disputes resolve after a demand letter alone, without ever stepping foot in a courtroom. That's because most people and businesses would rather pay what they owe than deal with the hassle, cost, and public record of a court case.

A strong demand letter includes:

• A clear statement of what's owed and why
• The specific amount, with documentation if you have it
• A deadline to pay (usually 10-15 days)
• A statement that you'll pursue legal action if they don't respond

You can write one yourself, but getting the tone and legal language right matters. Too aggressive and it gets dismissed. Too soft and it gets ignored. Services like PettyLawsuit generate and send demand letters instantly via certified mail, which creates a paper trail and proves delivery.

What If the Demand Letter Doesn't Work?

Some people ignore demand letters. Maybe they think you're bluffing. Maybe they genuinely don't care. That's when you escalate.

The next step is persistence. Follow-up phone calls, additional written notices, and a Final Notice that makes clear you're moving toward court. This pressure campaign works because it costs the other person time and mental energy. Every call, every letter reminds them that this isn't going away.

Think of it this way: ignoring one letter is easy. Ignoring a consistent, documented campaign of follow-ups is exhausting. Most people cave at this stage because fighting you has become more expensive (in time and stress) than just paying.

Small Claims Court: Your Backup Plan (That's Not as Scary as It Sounds)

If demand letters and follow-ups don't get your money back, small claims court exists for exactly this situation. It was built for regular people resolving disputes without lawyers.

Here's what you need to know:

Every state has a dollar limit. Most states cap small claims between $5,000 and $10,000, though some go as high as $25,000. If your dispute is under the limit, small claims is your court.

You don't need a lawyer. In fact, some states don't even allow them. The whole point is that you represent yourself, explain what happened, show your evidence, and let a judge decide.

Filing costs are low. Most states charge between $30 and $75 to file. Compare that to hiring an attorney at $200-$400 per hour.

Cases move fast. Unlike regular court cases that drag on for months or years, small claims hearings typically happen within 30-60 days of filing.

How to Actually File

Filing varies by state, but the general process looks like this:

1. Figure out which court has jurisdiction. Usually it's the county where the person who owes you lives or where the transaction happened.
2. Fill out the claim form. You'll need the other person's full legal name and address, the amount owed, and a brief description of why they owe you.
3. Pay the filing fee. Typically $30-$75 depending on your state and the amount you're claiming.
4. Serve the other party. They have to be officially notified about the lawsuit. Most courts require this through certified mail or a process server.
5. Show up on your court date with evidence. Contracts, text messages, emails, receipts, photos. Anything that proves your case.

Many states now let you file online, which saves a trip to the courthouse. Check your local court's website for specific forms and procedures.

What Evidence Do You Actually Need?

Judges in small claims court want to see proof, not hear arguments. The stronger your documentation, the better your chances.

For money owed on a loan or agreement:

• Any written agreement, even a text saying "I'll pay you back"
• Bank transfers or payment app screenshots showing the money you sent
• Text or email conversations where they acknowledge the debt
• A timeline of your attempts to collect

For contractor or service disputes:

• The original contract or estimate
• Photos of incomplete or shoddy work
• Communication showing you tried to resolve it
• Receipts for any costs you incurred to fix their mistakes

For security deposits and landlord disputes:

• Your lease agreement
• Move-in and move-out photos
• Any itemized deduction list from the landlord
• State law showing the deadline they missed (most states require return within 14-30 days)

Pro tip: send yourself a summary email after every interaction. It creates a timestamped record that's hard to dispute.

"Is It Worth It?" Yes. Here's Why.

People ask this all the time. "Is it really worth going through all this over $500? Over $1,000?"

Short answer: yes.

Longer answer: that $500 is your money. You earned it or you're owed it. The person who has it is banking on the fact that you'll decide it's "not worth the hassle." That calculation is exactly why they haven't paid you.

When you send a demand letter or file in small claims, you flip that math. Suddenly they're the one calculating whether it's worth fighting you. And in most cases, it's not. Paying you is cheaper and easier than showing up to court.

One real example: a customer used a demand letter to recover $800 from a freight broker who kept "forgetting" to reissue a check. The letter cost far less than the amount owed, and the check showed up within a week. No court. No lawyer. Just a clear signal that the dispute wasn't going away.

Common Situations Where People Sue for Money Owed

If you're wondering whether your situation qualifies, here are the most common reasons people take action:

• Personal loans: You lent money to a friend, family member, or acquaintance and they won't pay it back
• Security deposits: Your landlord kept your deposit without valid justification
• Contractor disputes: A contractor took your money and didn't finish (or never started) the work
• Unpaid invoices: A client or customer received your product or service and hasn't paid
• Refund refusals: A company won't give you a refund you're entitled to
• Car repairs: A mechanic charged you for work that wasn't done or made the problem worse
• Freelance work: You completed a project and the client disappeared without paying

All of these are legitimate reasons to pursue what you're owed. None of them are "too small" or "not worth it."

What Happens After You Win?

Winning a judgment is great, but collecting is a separate step. If the person pays voluntarily after the judgment, you're done. If they don't, most states give you tools to enforce it:

• Wage garnishment: The court orders their employer to send you a portion of their paycheck
• Bank levy: The court freezes their bank account and transfers what you're owed
• Property lien: A lien on their property means they can't sell it until they pay you

The judgment also goes on their record, which can affect their credit and their ability to rent, borrow, or do business. That alone motivates most people to pay up.

Stop Waiting. Start Collecting.

Every day you wait is another day someone else has your money. The process isn't as complicated as people think. A demand letter takes minutes to send. Small claims court costs less than a nice dinner out. And 70% of the time, you won't even need court.

You have more power than you realize. The question isn't whether you can afford to take action. It's whether you can afford not to.

PettyLawsuit helps you send demand letters instantly, follow up with phone calls and emails, and file in small claims court if needed. 2,500+ cases and counting. Don't let it slide.