Creditor took payment for debt assigned to collection agency

[Vonne]

What is the name of your state?California:
Can anyone please tell me if a collection agency can bill me for fees such as interest fees, process service,court fees, etc., that they state they incurred while attempting to collect a debt on behalf of a medical institution which assigned the debt to them? I paid the medical bill in full to the original creditor/medical institution who accepted payment after they had assigned it to the collection agency. The medical institution said they would let the collection agency know it was paid in full and reassured me it was taken care of and said I did not have to negotiate with the collection agency. However, the collection agency is furious that I paid the bill in full to the medical instituion instead of to them. They recently sent me a threatening letter demanding over 200.00 in fees for their efforts in attempting to collect on the bill and they say they will take me to court for more fees if I don't immediately give them the 200.00 by October 20, 2004. Do I have any recourse, or do I have to pay the fees they are requesting.

 

[Ladynred]

I suggest you send a copy of that nasty letter to the medical facility that hired them. They CAN be held accountable for the actions of collectors the hire.

The CA cannot make you pay court costs, only a judge can award those. They also cannot charge you 'collection fees' unless that was stated in any agreement you signed with the hospital.

§ 808. Unfair practices [15 USC 1692f]

A debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section:

(1) The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.

 

[Vonne]

CA Thanks Ladynred for replying to my post. I did call the medical facility regarding the collection agency's letter threatening to sue me, and I will send them a copy of the letter as well. The billing representative at the medical center who took the payment from me for the old bill said, "if I had the money, I would pay it for you." She was referring to the 200 plus fees the collection agency is trying to get from me for their efforts in attempting to collect. She seemed to feel badly about the situation, she even called the collection agency, but they would not budge. I think they have already filed a case in Superior Court as they state they are going to send the local Sheriff to serve me with papers. The collection agency said Civil Code Section 1717.5 gives them the right to request attorney fees as well as all the other charges. This is a very hungry collection agency out of Bakersfield, CA, and I plan on going to court to at least tell my side of the story, the collection agency will have to earn their 200 or so they are wanting.

 

[Prpledrms23]

I thought all those "fees" could only be added to your cost of debt if there was a judgement awarded against you and the judge allows it to happen. Thats stupid for them to take you to court over that. Did you ask the original creditor of the debt was just assigned to the CA vice beight bought?

 

[Vonne]

My problem is getting worse! I received a service in the mail yesterday, prepared on Judicial Council of California CM-110 "Case Management Statement" filed in Superior Court of California, County of Kern. The collection agency is suing me for Section 4b: "INTEREST AT THE LEGAL RATE, ATTORNEY FEES PURSUANT TO C.C. 1717.5 AND COSTS. CURRENT AMOUNT IS 210.00." Section 19 Other Issues: "WE FILED OUR LAW SUIT ON 6/21/04, MRS. PAID HER ACCOUNT TO CLIENT ON 6/24/04, MRS DON'T UNDERSTAND THAT WE FILED OUR LAW SUIT BEFORE SHE PAID CLIENT SO MRS REFUSES TO PAY REMAINING BALANCE, IF NOT PAID BY 10/20/04, IT WILL GO OUT FOR SERVICE WITH TULARE COUNTY." This is what they wrote in a letter to me in October: "This letter is to advise you, pursuant to our letter of May 5, 2004, costs in the amount of 145.30 have been spent by this office to have the lawsuit filed. Additionally, there was 65.03 interest accrued prior to the lawsuit being filed, and pursuant to Civil Code Section 1717.5 there are attorney fees in the amount of 83.00 due." They state in the bottom of this letter that if I don't pay by October 20th they are sending the sheriff to serve me and there will be additional costs for that plus more attorney fees than what they are already requesting. I was never served with the law suit the collection notice filed with Superior Court, so how did this thing get set for hearing on October 29, 2004? I don't even have time to prepare any kind of an answer to their suit before the 29th. If I don't answer this complaint, I am afraid the court will award them all kinds of what I believe to be bogus and illegal fees, but they are not giving me enough time to answer, the hearing is only nine days away and the court is fifty miles from me!