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California Legal Question regarding interest charges


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OK, I cannot seem to find it in the laws or statutes that allows for a collection agency or whatnot to charge interest after chargeoff, yet they all seem to do it. What gives?! Am I missing something?

Under unfair collection practices it states that no fees/charges/etc can be charged unless expressly permitted by contract or statute, the statute applies to judgments and bad checks from what I can find, but I can't find where there's any interest allowable unless permitted by contract.

I have a CA who sent me 4 years worth of copies of visa bills as validation. No original Contract. Here is the letter they sent me with all of teh bills

They do refer to "their client", so I am guessing it's assigned not sold. There is interest above $100.

The note says:

Dear Me,

Enclosed is the information from our client in response to your dispute of this account. The creditors position is that this account is valid and owing.

In accordance with the FCRA this account, if reported to the credit bureaus, must be reported as a disputed item (which they have not actually done yet)

We would like to work with you to resolve this matter. please contact our office.

Collection Agency

DBA Other name

Interest continues to accrue at the rate allowed by law on unpaid principal balances (which I thought was only unpaid principal balances for JUDGMENTS).

This is an attempt to collect (blah blah blah).

This is the same CA that sent me a notice that they received my dispute on a BILL!

They also note that the account will be listed in dispute as it should be by law, but they've told me this twice now and the account is still not listed in dispute.

So.. back to the interest thing - where can i find law that says interest is allowable on any past due debt? Is there such a law? Any help is greatly appreciated. Thank you very much.

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It is probably civil code section 3287:

3287. (a) Every person who is entitled to recover damages certain,

or capable of being made certain by calculation, and the right to

recover which is vested in him upon a particular day, is entitled

also to recover interest thereon from that day, except during such

time as the debtor is prevented by law, or by the act of the creditor

from paying the debt. This section is applicable to recovery of

damages and interest from any such debtor, including the state or any

county, city, city and county, municipal corporation, public

district, public agency, or any political subdivision of the state.

http://www.leginfo.ca.gov/cgi-bin/displaycode?section=civ&group=03001-04000&file=3287-3291

When in doubt, I always just ask. They may be relying on a more specific statute.

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It is probably civil code section 3287:

3287. (a) Every person who is entitled to recover damages certain,

or capable of being made certain by calculation, and the right to

recover which is vested in him upon a particular day, is entitled

also to recover interest thereon from that day, except during such

time as the debtor is prevented by law, or by the act of the creditor

from paying the debt. This section is applicable to recovery of

damages and interest from any such debtor, including the state or any

county, city, city and county, municipal corporation, public

district, public agency, or any political subdivision of the state.

http://www.leginfo.ca.gov/cgi-bin/displaycode?section=civ&group=03001-04000&file=3287-3291

When in doubt, I always just ask. They may be relying on a more specific statute.

Thank you Calawyer.. still doesn't make sence to me lol, the law seems to contradict itself as it states that interest is not allowable except as permitted by statute etc.. I will definately request more info from them. But this seems to apply all across the board with some collection agencies..

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