Can a collection agency continue to charge interest after sending a final demand with a stated amount?
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Can a collection agency continue to charge interest after sending a final demand with a stated amount?
Debt incurred 3 years ago. I received final demand letter for $580.34. No further correspondence; pulled credit report and saw an amount within a few dollars of the demand. Honestly forgot about through divorce, etc. Called them as I wanted to see if we can negotiate settlement. They say I owe $730.51 as interest charged 10% daily on unpaid. Will “allow” me to pay $650 to avoid further action from them now that “we know where you work”. I need this off my credit report as I’m trying to buy a house (I’m between a between rock and hard place). To me, final means final, so why do they keep charging.
Asked on July 5, 2011 under Bankruptcy Law, California
Answers:
M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
One would have to review the letters sent and the law in California but I am guessing here that the amount was computed within the time frame that the letter was recieved. The fact that you have delayed caused the interest to accrue. Now, if the interest is above the legal amount computed (and it certainly seems unreasonable her) then you have some wiggle room here. But really you need to play hard ball. Let them know that you qualify under Federal guidelines for a reduction of all debt (just bluff) and you are considering bankruptcy (I know, but bluff) to discharge the debt but you want to do the right thing. You can pay off that amount in full and expect a satisfaction letter now. Otherwise, who knows, And if they continue to threaten you you will call the state attorney general and file a complaint. Good luck.
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