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

Lizzieee89

TripleH said:

My advice on the overpayment (and I'm only talking pennies) is to stop the money being taken and the query being ignored if the exact amount is paid.

Yes it will be treated as a payment on account but it adds further that you paid under protest rather than caved in.

My normal advice would be to set aside the money and challenge but the repercussions for not paying are too severe.

It is a bug to the management company because the money is (should be) sat in their client account and they need to reconcile it and deal with 'errors' plus it gives the Op a better position to query the management company if the difference disappears.

I assume you mean overpayment to the managing agent/freeholder, but not to the debt agency (i.e. ignore the debt agent's threats and letters)?  When I last called, they wanted me to pay the debt agency but maybe they are just trained to say that.  I don't see why they can't just tell the debt agency to stop if they received more than that invoiced amount in their account.  I can overpay by 10%, that's not a problem....frustratingly that gives me less leverage to query their last bill.

The worry of course is if I overpay now, they wil say it's for this year's service charge and I still need to pay the debt agency and their fees for last years!!!

Lizzieee89

eddddy said:

Grizebeck said:

Because a stranger to a debt never have has any rights unless a debt has been assigned (ie brought) 

Lizzieee89 - it's best to ignore some of these comments about debt collection agencies. Otherwise you could end up owing more money and/or face legal action.




The management company has told you to deal with the debt collection agency - so it sounds like the debt collection agency is genuinely an agent of the freeholder.

• If the debt collection agency has sent you a valid Service Charge Demand, it's probably best to pay it.

• Or if the debt collection company is chasing a valid Service Charge Demand that was issued by the Freeholder or Management company - it's probably best to pay the Service Charge Demand that was issued.

Pay under protest, and then challenge it.

This is the debt collecting agency the freeholder is using 

www.propertydebt.co.uk

My biggest concern is how they seem to ignore all my "very reasonable" queries and get away with it.  Also I genuinely did not see their letter threatening to use a debt agency, it came as a surprise.  I never received a letter, but there was an email which I missed.  In any case, I can pay them but the thought of paying this debt agency a fee is just "dirty".

eddddy

At this stage the most important thing is to pay any Service Charge Bills you've received in full. Follow the payment instructions on the bill.

Don't play games - don't overpay by 10%.

And definitely don't pay a different company or account from the one shown on the bill - that might count as not paying the bill.

You can challenge the bills later.



A pensioner who didn't pay their Service Charge Bill as a protest came close to losing their £800k flat.   https://www.betterretirementhousing.com/plantation-wharf/

Another article about Service Charges for the case above says:

Pay first, argue later...

If you are in dispute with your freeholder over service charges (see Plantation Wharf case), pay the sum and fight the action retrospectively....

It is important not to withhold service charges for any reason to avoid this use of the law. Paying the service charge does not mean you accept liability to pay that amount 

Link: https://leasehold98.rssing.com/chan-21278615/all_p1.html

Lizzieee89

eddddy said:

At this stage the most important thing is to pay any Service Charge Bills you've received in full. Follow the payment instructions on the bill.

Don't play games - don't overpay by 10%.

And definitely don't pay a different company or account from the one shown on the bill - that might count as not paying the bill.

You can challenge the bills later.



A pensioner who didn't pay their Service Charge Bill as a protest came close to losing their £800k flat. 

Another article about Service Charges for the case above says:

Pay first, argue later...

If you are in dispute with your freeholder over service charges (see Plantation Wharf case), pay the sum and fight the action retrospectively....

It is important not to withhold service charges for any reason to avoid this use of the law. Paying the service charge does not mean you accept liability to pay that amount 

Just so I didn't misunderstand...are you saying it's best to pay the managing agent/freeholder the exact amount of bill (rather than overpay "under protest")  INSTEAD of paying the debt collection agency, even though the managing agent has instructed the debt agency and I've been told to pay the debt agency instead?  The Debt Agency's bill has extra admin fee tagged on, whereas the original bill from managing agent does not have that fee (as it is a "no win no fee" agency that doesn't charge the client). 

Or are you saying I should pay the debt agency the bill including their admin fee?  I feel if I pay the debt agency their admin fee then this is what they will do every time moving forwards.  They still have not responded to my very reasonable query, they just ignore me!

Lizzieee89

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? 

doodling

Hi,

I would pay whoever the freeholder has told you, in writing, to pay and I would pay the exact amount that that entity has requested.

If that is the debt agency then you have the option of attempting to reclaim their fee from the freeholder at a tribunal on the basis that it is unreasonable.

As others have said, it is almost always better to contest service charges or ground rent after you have paid them as the consequences of not paying can be out of all proportion to the charge itself.

Tiglet2

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.

Lizzieee89

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.

Tiglet2

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.

eddddy

Lizzieee89 said:

Or are you saying I should pay the debt agency the bill including their admin fee? 

The problem is that I can't see the bills - so I can't say for sure. But just to be safe...

• I'll assume that the bill you got from the Debt Agency is a valid Service Charge bill
• I'll assume that the Debt Agency's fee is a valid Administration Charge

So

• You should pay the exact amount of the Debt Agency bill in full (including the Admin Fee).
• You should follow the payment instructions on the Debt Agency bill.

You should also send an email to the Debt Agency and the Management Company saying something like:

I am paying Service Charge bill number ---------, for [flat address] under protest. I do not believe the bill is reasonable, and I intend to challenge it at a tribunal.


My reasons include:

I do not agree that the original Service Charge demand was reasonable, because [your reasons for querying the original bill]

I note that you have added an Administration Charge in respect of a Debt Collection Agency.

I do not believe it was reasonable for you to instruct a Debt Collection Company

I do not believe the Administration Charge for the debt collection company is reasonable

If the Management Company and / or Debt Collection Agency won't back down, or won't reply - you can take them to tribunal. 

See: https://www.lease-advice.org/faq/how-do-i-make-an-application-to-the-first-tier-tribunal-property-chamber-for-my-service-charge-to-be-determined

Lizzieee89 said:

I feel if I pay the debt agency their admin fee then this is what they will do every time moving forwards.  They still have not responded to my very reasonable query, they just ignore me!

If you pay the Service Charge bill when you get it, then no Debt Collection Agency will be involved, so there will be no fee to pay.

What is the query?

You have a lot of legal rights which you can use as a leaseholder. But you shouldn't withhold service charges.