If CA charges you a fee along with the principal it a violation of the FDCPA. My principal is 412 and they say I owe them 637. I found this statement but i'm not sure if it means they cant charge you interest. "(1) The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law." Please Help!!!!!!!!!!!!!!!!!!!!
unless such amount is expressly authorized by the agreement creating the debt or permitted by law Validation. Make them prove you owe the debt AND interest/fees. It must be expressly stated in your agreement or allowable by law to add XXX% interest to the debt. -Peace, Dave
This has bothered me too. Does this mean that fees/interest must be expressly stated as doing normal course of business and that is enough for a OC/CA to keep charging them after charge-off? Or does this mean that the agreement must expressly state that the fees/interest will be charged in case of delinquency/charge-off? Must the agreement be specific to the situation of charge-off/delinquency? This seems ambigious to me... Kim
I looked at all my cardholder agreements (yes I keep them all) after reading this. Every one has a disclaimer such as: "...If after default we refer your account to a collection agency or an attorney who is not our salaried employee, you agree that, when and as permitted by applicable law, we may charge and collect from you, 1. our collection costs, including and without limitation court costs, reasonable attorney fees, collection agency fees and the corresponding annual percentage rate from the last publication day of the calendar month in which the default occured." A lot depends on your cardholder agreements and the applicable law for your state. Some states limit the APR for collection accounts, others have no limit. I think what is the real killer is the "collection agency fee". If the debt is $1000 and the agency charges the creditor a fee of 25% to collect, they will immediately try to collect $1250, not including interest."
