Credit Problems

I signed a "no way out contract" before my business failed and I had to close it. I understand that I am responsible for the remainder of the bill ($3,500) w/ a payment of $95 a month. I can only pay $50 a month until I get back on my feet after the business closure. I thought I had reached an agreement w/ the company I owe the money to; however, they continue to send me letters saying they will mar my credit if I do not pay the past due amount in full. My understanding is that they can mark it slow pay. Can they really ruin my credit, even if I continue to pay the $50 a month on a regular basis until the debt is paid in full? Is there anything I can do about it? Please reply.

what about offering a settlement? like tax time returns. ask them to send you something in writting to release you from anymore problems and future agreements.