Freeholder's agent instructed Debt Agency for Service Charge after I queried service charge :(

Lizzieee89

Tiglet2 said:

Lizzieee89 said:

Tiglet2 said:

Lizzieee89 said:

eddddy said:

Lizzieee89 said:

Thanks for the great advice!

There is some terrible advice in this thread.

Maybe just ignore everything here and contact LEASE for some free advice. in a 15 minute phone call

Lizzieee89 said:

So should I

1) call the managng agent and say I will pay X amount now and pay the rest after I get my answer (last time I called they said "only speak to debt agency as the debt has been passed on" but I feel they are bluffing)

 No.

That's probably the worst option of everything. More debt collection fees will probably be added. Legal action might still be taken against you.

Lizzieee89 said:

2) Pay managing agent more than what debt agency is trying recover, and then ask them to answer my queries?  If I do this, should I email the debt agency and say I already paid their client their money so please stop your letters/emails/threats.

You can pay extra if you want. But it serves no real purpose.

If for example, your account shows that you owe £958.50 - and you pay £1000....

The accountant will just type £1000 into their computer system, and the computer system will calculate that your account is now £41.50 in credit. 

Lizzieee89 said:

I don't want to pay the debt agency the few hundred quid admin fee as my Dad taught me that Debt Agencies are "scum", but of course I am scared of having credit issues

You won't have credit issues. But if you don't pay...

• you might be charged further fees
• your mortgage lender might be contacted - and they will pay
• your freeholder might start the process of forfeiting your lease (repossessing your flat)

Thanks for the advice.  I'd love to call LEASE but their next availability is July 1, which is after the deadline the debt agency provided.  Their letter says if I don't reply within 30 days they can take me for court!

I am happy to pay the exact amount but should I pay the managing agent or the debt agency (who added extra admin fee)? 

If I pay the managing agent, is there a way for the debt agency to still come after me?  I supposed the managing agent can claim my payment is for this year's service charge rather than last year's though I can email them specifically and say this payment is for last year's.   Perhaps I can call the managing agent (they ignore my emails) and say I will pay the full bill if they stop the debt agency? 

Lizzieee89, my advice would be to pay the whole amount to the debt agency, as your managing agents/freeholder have asked you to, but make sure you do it "under protest".  The managing agent has put the matter into the hands of a debt agency so now you need to liaise with the debt agency for the outstanding service charge account. 

I think you need to stop trying to get out of paying the admin and/or paying in instalments.  Not paying service charges is a serious matter.  You could potentially lose your home if steps are made to forfeit the lease, together with escalating admin fees being added to the original debt on a daily basis.

Then, deal with your issue over service charges.

This freeholder has wrongfully charged leaseholders in the past, it seems like there are zero consequences and we cannot even query?  There is a bill from the managing agent as well as a bill from the debt agency, so you are saying one should pay the debt agency and NOT the managing agent, even though the managing agent can stop the process at any time? 

My query to them is very reasonable.  What is unreasonable is that they don't answer my query (which is an issue shared by other leaseholders).  Of course, most leaseholder do not have time to chase these issues as they have full time jobs, so the freeholder and managing agent get away with these issues.

I wasn't aware there were two bills, but then you have the paperwork and I don't.

What is the total amount outstanding as at today's date?  That's what you should be paying in accordance with the instructions on the letter.

The credit controller of the agent said the bill with the arrears (about half a year of service charge, I already paid the other half) had been "passed on" to a debt collection agency.  Then the debt agency sent a bill with those arrears, plus their fees.

However, in the same week I also got a new bill from managing agent that contains the same arrears plus the latest quarter.  So there are two bills.  Managing agent's bill is higher as it contains latest quarter, while Debt agency's bill is lower but has extra admin fees.  This leads me to believe the arrears were not passed on, and the debt agency is just an alternative way to chase money that's free for them as the leaseholder pays the admin fee.

What if I pay the full bill from managing agent and ignore Debt Agency?  Can Debt Agency still continue to chase me if I owe nothing to their client?  I still want answers to my query but it seems like the cards are stacked against me...

user1977

Lizzieee89 said:

Tiglet2 said:

Lizzieee89 said:

Tiglet2 said:

Lizzieee89 said:

eddddy said:

Lizzieee89 said:

Thanks for the great advice!

There is some terrible advice in this thread.

Maybe just ignore everything here and contact LEASE for some free advice. in a 15 minute phone call

Lizzieee89 said:

So should I

1) call the managng agent and say I will pay X amount now and pay the rest after I get my answer (last time I called they said "only speak to debt agency as the debt has been passed on" but I feel they are bluffing)

 No.

That's probably the worst option of everything. More debt collection fees will probably be added. Legal action might still be taken against you.

Lizzieee89 said:

2) Pay managing agent more than what debt agency is trying recover, and then ask them to answer my queries?  If I do this, should I email the debt agency and say I already paid their client their money so please stop your letters/emails/threats.

You can pay extra if you want. But it serves no real purpose.

If for example, your account shows that you owe £958.50 - and you pay £1000....

The accountant will just type £1000 into their computer system, and the computer system will calculate that your account is now £41.50 in credit. 

Lizzieee89 said:

I don't want to pay the debt agency the few hundred quid admin fee as my Dad taught me that Debt Agencies are "scum", but of course I am scared of having credit issues

You won't have credit issues. But if you don't pay...

• you might be charged further fees
• your mortgage lender might be contacted - and they will pay
• your freeholder might start the process of forfeiting your lease (repossessing your flat)

Thanks for the advice.  I'd love to call LEASE but their next availability is July 1, which is after the deadline the debt agency provided.  Their letter says if I don't reply within 30 days they can take me for court!

I am happy to pay the exact amount but should I pay the managing agent or the debt agency (who added extra admin fee)? 

If I pay the managing agent, is there a way for the debt agency to still come after me?  I supposed the managing agent can claim my payment is for this year's service charge rather than last year's though I can email them specifically and say this payment is for last year's.   Perhaps I can call the managing agent (they ignore my emails) and say I will pay the full bill if they stop the debt agency? 

Lizzieee89, my advice would be to pay the whole amount to the debt agency, as your managing agents/freeholder have asked you to, but make sure you do it "under protest".  The managing agent has put the matter into the hands of a debt agency so now you need to liaise with the debt agency for the outstanding service charge account. 

I think you need to stop trying to get out of paying the admin and/or paying in instalments.  Not paying service charges is a serious matter.  You could potentially lose your home if steps are made to forfeit the lease, together with escalating admin fees being added to the original debt on a daily basis.

Then, deal with your issue over service charges.

This freeholder has wrongfully charged leaseholders in the past, it seems like there are zero consequences and we cannot even query?  There is a bill from the managing agent as well as a bill from the debt agency, so you are saying one should pay the debt agency and NOT the managing agent, even though the managing agent can stop the process at any time? 

My query to them is very reasonable.  What is unreasonable is that they don't answer my query (which is an issue shared by other leaseholders).  Of course, most leaseholder do not have time to chase these issues as they have full time jobs, so the freeholder and managing agent get away with these issues.

I wasn't aware there were two bills, but then you have the paperwork and I don't.

What is the total amount outstanding as at today's date?  That's what you should be paying in accordance with the instructions on the letter.

What if I pay the full bill from managing agent and ignore Debt Agency?  Can Debt Agency still continue to chase me if I owe nothing to their client?

I guess their client would treat the fees incurred by the debt agency as being costs they can pass on to you, so it's going to need to paid one way or another.

Lizzieee89

No, the debt agency does not charge their client (the freeholder).  Only the leaseholder pays the admin fees.  "No win, no fee". 

user1977

Lizzieee89 said:

No, the debt agency does not charge their client (the freeholder).  Only the leaseholder pays the admin fees.  "No win, no fee". 

Maybe they'd regard you paying the freeholder directly as a "win" though. You don't have any say in whether they charge a fee or not.

Lizzieee89

user1977 said:

Lizzieee89 said:

No, the debt agency does not charge their client (the freeholder).  Only the leaseholder pays the admin fees.  "No win, no fee". 

Maybe they'd regard you paying the freeholder directly as a "win" though. You don't have any say in whether they charge a fee or not.

I agree.  That's why it might be better to just pay the managing agent direct, as the admin fee goes direct to the debt collection agency and if they collect nothing then they get no fee.  I'm just wondering if the debt collecting agency can still continue to chase me after I'd already paid the managing agent.  Frustrating part is I seem to have no leverage to get them to answer my questions about the service charge, they just ignore me if they don't have the answer...

anselld

Lizzieee89 said:

user1977 said:

Lizzieee89 said:

No, the debt agency does not charge their client (the freeholder).  Only the leaseholder pays the admin fees.  "No win, no fee". 

Maybe they'd regard you paying the freeholder directly as a "win" though. You don't have any say in whether they charge a fee or not.

  Frustrating part is I seem to have no leverage to get them to answer my questions about the service charge, they just ignore me if they don't have the answer...

The correct way to challenge the service charge is to threaten or indeed to actually take them to the First Tier Tribunal.  Pay under protest and then refer the matter to the Tribunal if you have not had satisfactory response to complaints or queries.

Lizzieee89

I understand it costs £100?  I've been to one before and it was a lot of work, even though I won.  The managing agent knows it's a big hassle, most leaseholders will not bother as they are almost all buy to let folks who don't have time to deal with this.