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Reply To: Hello I have had a creditor who has put a debt collection agency onto us for a bill that was due on 20th February 2020. We have since paid the debt in full but now I have received a bill from the debt collection agency for $200 costs and $76 interest. I’m not even sure I have sign a application for credit with the creditor as we first started dealing with them 15 years ago. Should I pay the collection fees and interest, or ask for more information. The original amount was $950.Thanks 

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Hi there

Have you entered into a contract with them for the supply of goods or services that govern all transactions etc? This contract may say that if you don’t pay by a certain time then they can charge interest, get a debt collector involved etc and that they will pass on these collection costs to you. If you haven’t signed a contract for the on-going supply of goods or services, then these terms may, for example, be printed on the back of their invoice or provided at the time of sale.

If you’re unsure I’d ask them for further info i.e. point to where it says you are liable to pay interest / collection costs.

Practically it may be a case of saying “sorry I’ve paid this late” – if late payment is a one-off or rare then they might waive some or all of it if you have a good relationship with them but they might take a different view if they have already chased payment etc.

I hope that helps
Ed

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