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Question :
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 

Question submitted 04/05/20 @ 01:07pm
Industry: Legal
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  • Hi there,

    This will depend on your creditors terms and conditions, what they say on this point and whether you have agreed to them. I’d ask for more information and go from there.

    Phil

    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

    Hi. I’m a lawyer. Not my specialist area, but I checked with one of colleagues who does more of this stuff. Without more information, you should only be liable for these costs if you signed up (or otherwise agreed) to terms of trade which specified you could be up for these costs. As a starting point, you could reply to the collection agency advising that you paid the debt in full and asking that they explain the basis upon which they say you are liable to pay their collection fees and interest, and pointing out that in any event the fee charged is not proportionate to the amount of the debt that was owing. Good luck. Jeremy

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