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TLDR: terminated lease after continued upstairs noise, landlord sent debt collector, trying to decide if should pay debt collector and sue landlord for money back.

We had been renting an apartment in Massachusetts. For over a year, we had trouble with our upstairs neighbors' noise which got worse until we couldn't sleep more than 3-5 hours at night (we have thoroughly documented these issues and our requests to the landlord to resolve them). After this lead to degraded performance at work, we obtained legal consultation which advised us to terminate the lease since the landlord did not provide a safe and habitable environment (State Sanitary Code, 105 CMR 410.00) which we did. The landlord, a property management, did not agree with this, did not refund us our security deposit despite no issues with the apartment, and wanted us to pay the rent until they find a new renter which we declined. We think they also did not immediately advertise the apartment as for rent as it did not show up on their website. After some months, we were contacted by a debt collector, asking us to pay two months of rent. We told them the claim was invalid for the reasons stated above, but they said they will report the claim to credit agencies as disputed.

We don't want this issue to adversely affect our credit and got legal consulting which suggested we should pay the debt collector to protect our credit score, and then sue the landlord for the money back in small claims court. I'm a little worried about this strategy since it requires to hand away the money first, and am trying to get second opinions.

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    Don't dig a hole. Don't pay, tell the collector the matter is subject of a civil suit, sue the landlord for the breach. – user207421 Oct 14 at 23:23
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We don't want this issue to adversely affect our credit and got legal consulting which suggested we should pay the debt collector to protect our credit score, and then sue the landlord for the money back in small claims court. I'm a little worried about this strategy since it requires to hand away the money first, and am trying to get second opinions.

The debt collector is probably either the owner of the claim against you, if it is an assignee of the claim, or an agent of the landlord for purposes of collection.

Thus, payment to the debt collector is equivalent to payment of the landlord.

The law varies from jurisdiction to jurisdiction regarding whether payment constitutes of waiver of a right to sue over the debt. Sometimes it is necessary to designate the payment "under protests" or "reserving all rights", but that is not a uniform rule of law that applies in all jurisdictions, and I do not have the time and familiarity with that state's law to research Massachusetts case law on that point accurately.

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I'm guessing there was no formal hearing regarding the sanitary code and no order to vacate was issued. As such, you broke your lease and are subject to the penalties outlined within it. I don't know if you gave proper notice or not, but loss of your security deposit and an additional two months rent sounds reasonable for abandoning a lease. In Massachusetts, the security deposit can be used to cover unpaid rent.

The only way I can see that you might win against the landlord would be if you could prove that they dragged their feet on relisting the unit. Though it takes time to clean, paint, and re-carpet an apartment, so the time they took was probably reasonable. Even if you did win, that would likely only let you recoup a few hundred; not the full amount.

You can try to negotiate down the balance with the debt collectors, you can try to enter into a payment plan, or you can wait to be sued and argue why you shouldn't owe in court.

Even if you can repair your credit history, your rental history is still likely to remain damaged, and renting in the future will be more difficult for you (higher deposits, cosigners required, etc.)

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    According to legal consultation we obtained before terminating the lease, all we had to do was request the landlord to fix the issues (which we did in writing over the course of a year) and if they did not fix them, they would be in violation of the sanitary code. Is that incorrect then and we should have involved a court at that stage? – mschrimpf Oct 14 at 20:07
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    @mschrimpf We don't know all of the facts, so if an attorney has advised you, you would be better off listening to your attorney rather than some internet strangers. 105 CMR 410.00 does not address excessive noise, so I think there's some confusion about it being cited. There may be grounds for filing a civil suit for breach of quiet enjoyment. This type of suit can award attorney fees, so it might be possible to to hire an attorney for this without any upfront costs. – Luck Oct 14 at 21:22

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