Collecting Debt

Legal Action against You
When you owe a debt and do not pay, the person you owe the money to (the creditor) can take court action to recover the money and any other costs incurred - eg, lawyer's fees, court costs. Creditors can take court action to recover unpaid debts. But when a debt is disputed, they cannot lead you to believe that the only way to stop court action is to pay the debt.

For example: a letter from a debt collection agency showing that the non-payment of a $95.00 debt will result in court action and you will have to pay $150.00 lawyers fees, $110.00 in court costs plus any other related charges.

Paying Collection Fees
Collection fees are fees charged by debt collection agencies, in addition to the original amount of the debt. Debt collection agencies can only charge collection fees if you are aware (at the time you purchase the goods or services) that late payments result in extra charges.

If traders want to add debt recovery costs to the money you owe, they must warn you about the possible extra c...

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