Unfair Administation Charges

Ericson_2

I wonder if any one can help, I am posting this on behalf of a friend, honestly, because she has got herself into trouble with a debt collection agency who charge for the slightest thing.

My friend who now cares for her Mother and is on benefits bought a coat from a mail order company about two and a half years ago for £80 through no fault of her own she has had a lot of personal troubles since then and has tried to pay this off very eraticaly, with many missed payments . They charge £12 for every letter sent and also admin charges so this £80 has now rocketed to £392
she has in effect paid for the coat but even though she has explained of her worsening finacial situation and 24hr care for her mother which she has given up work to do, they still insist on the charge repayment.

My question is can they do this , can she write to them saying the charges are unfair and to cancel them, she trys not to be late with payments but her finacial situation is very unpredictable, at the moment they are charging for charges.

Any advise would be appreciated. please don't be harsh, there but for the grace of god and all that.

Thanks.

immoral_angeluk

I think the best thing to do if for her to write to them explaining the situation, and offer a payment that she can afford to make until her circumstances improve. Also if she sends them a copy of her SOA that will show that her offer is fair in light of her circumstances.

Alfie_E

Ericson wrote:

My question is can they do this , can she write to them saying the charges are unfair and to cancel them.

Of course she can. Whether the company will listen is another matter. This is what the OFT has had to say on the matter, in its Debt collection guidance July 2003.

2.32 The OFT's previous guidance on charging, issued in January 2000, covered the following:

• there is no legal basis to claim collection costs in the absence of express contractual provision
• debtors should not be led into believing they are liable to pay charges when this is not the case, and
• even if collection charges are allowed for in the contract we may still regard the levying of charges as unfair where they are of an unreasonable amount or disproportionate to the main debt.

2.33 We believe that guidance is still valid and that when referring to reasonable costs we should include reference to actual necessary costs.

Your friend should probably go to Citizens Advice. They could help with a strongly worded letter, and would also be able to say if it was wise to refuse to pay them any more, if she's paid more than is a reasonable amount.

I’m sure people will be along later who will be able to give their first-hand experience of charges like these.

rog2

Alfie_E wrote:

Of course she can. Whether the company will listen is another matter. This is what the OFT has had to say on the matter, in its Debt collection guidance July 2003.

2.32 The OFT's previous guidance on charging, issued in January 2000, covered the following:

• there is no legal basis to claim collection costs in the absence of express contractual provision
• debtors should not be led into believing they are liable to pay charges when this is not the case, and
• even if collection charges are allowed for in the contract we may still regard the levying of charges as unfair where they are of an unreasonable amount or disproportionate to the main debt.

2.33 We believe that guidance is still valid and that when referring to reasonable costs we should include reference to actual necessary costs.

Your friend should probably go to Citizens Advice. They could help with a strongly worded letter, and would also be able to say if it was wise to refuse to pay them any more, if she's paid more than is a reasonable amount.

I’m sure people will be along later who will be able to give their first-hand experience of charges like these.

Good advice - these charges are certainly disproportianate to the original debt, and are at least 'unfair' possibly even illegal.
Talk to CAB as soon as possible.