Legal Question in Credit and Debt Law in California

They can demand whatever they want, the question is whether if they had to go to court would they be able to collect that amount. Find out what they are charging for; they may be charging for setting up a file, doing some background checking, etc., and $300 for that might not be very unreasonable. Try to bargain with them. Offer a lump sum cash payment for a discount. Be sure the bill is not barred by the statute of limitations [4 years on a written agreement].

This depends on whether or not the underlying contract authorized the collection fee or whether it was authorized by law. You can contact a consumer rights firm like ours for a consultation to see what your rights and obligations are. Our law firm, MinCal Consumer Law Group, focuses on representing consumers against abusive collection agencies. You can reach us for a free consultation at 888-678-5550 or visit our website at http://www.mincal.com