Legal Question in Credit and Debt Law in California
Sending a Debt to Collections
I have two debts that I would like to send to collections. I have exhausted all means of collecting and have been abundantly patient (in one case 8 months has gone by)
Collection agencies take 50%.
Am I allowed to add an administrative or some other type of fee to the debt amount to offset this?
Say if the debt is $1500, can I send it in for $1500 plus the $1500 I will be charge so I still collect the entire debt?
Thank you.
2 Answers from Attorneys
Re: Sending a Debt to Collections
You need to include it in the contract at the outset that the customer is reponsible for interest on unpaid balances, for example 1 1/2 percent per month, plus all costs of collection including reasonable attorney fees.
Re: Sending a Debt to Collections
Attorney Stone is correct. You need to review the agreements you have with these individuals. If the agreements contain the provisions Attorney Stone indicated, you may have some success collecting the full amount plus collection fees and costs. If not, it is too late to add those provisions retroactively, and you are stuck eating the collection costs.
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