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Law Girl
Law Girl, Attorney
Category: Bankruptcy Law
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Experience:  I am an attorney.
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how much can a debt collection agency increase original debt

Customer Question

I have been contacted by national check bureau and they have tripled the original debt bought. is this legal in Indiana
Submitted: 8 years ago.
Category: Bankruptcy Law
Expert:  Law Girl replied 8 years ago.


Thank you for your question.

It is hard to know whether this is permissible without knowing the specifics. However, generally a debt collection agency is allowed to collect the original debt, any financing charges and/or late fees, any interest due on the debt, and reasonable fees associated with the collection of the debt. Depending on the amount of the debt, in some instances this can triple the amount owed. What the debt collection agency is entitled to collect, should be laid out in the contract.

Please let me know if you have any other questions, or require clarification of this matter. Otherwise please hit "ACCEPT", so I may receive credit for my response. Tips and feedback are also appreciated.

Good Luck!


Customer: replied 8 years ago.
Reply to Law Girl's Post: when a debt buying company purchases a debt, i don't see the ability to triple it, I would gladly work on paying the original debt of 5200 but 16,200 seems unfair, a company can do this? is that the truth?
just confirm, thank you... seems to me that interest is above and beyond and set limits or i'm just in the wrong business :)   
Any insight or where to look for this would be greatly appreciated.
Expert:  Law Girl replied 8 years ago.

Generally a company cannot randomly triple the amount you owe. However, with the other fees associated, the amount that the company is trying to collect can increase VERY quickly.

On some credit cards, interest can jump up to past 30% on delinquent amounts, so again, this adds up quickly. Then add collection fees or attorney fees to this, which can be upwards of hundreds of dollars an hour.. I am sure you see what I am saying.

At this point, the company may settle for payment on the original debt, however they may have no obligation to. However, that does not mean that you cannot approach them about trying to settle this matter without having to go to court.

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