Interest added by Cabot After Card debt sale - Is that Correct?

[tedney]

From research on other threads, I have understood that DCA's should not add interest to a debt. Is this correct:?:.

 

I had a credit card account which was defaulted and then closed (by the creditor).

 

I have been paying regular monthly payments to the original creditor,

and most of these have been recorded and are shown on copy statements that I received following an SAR.

 

The account was "charged off" by the OC and at that point and further interest was not added by the OC after that.

 

The account was then marked "Debt Sale" on the copy statements, and then a DCA started to add interest, despite my monthly payments continuing.

 

I have received no statements from the DCA, but my file on the CRA's show the sum owed as increasing.

The account does not show on the CRA anymore, as it is over 6 years old now.

 

I have the original agreement, but cannot find any reference to "transferring" the right to charge interest,

or for that matter any other aspect of the account, to a third party.

 

Where should I be looking:?: Is there a part of an act I can quote regarding "unlawful" interest please. Any help welcome. Thanks t

Edited May 12, 2013 by citizenB
formatting

[citizenB]

It is my understanding that interest cannot be added to the debt after it has been defaulted and terminated by the original creditor.

 

What this would amount to would be a charge for debt collection and again it is my understanding that it is not permitted.

 

On what basis is the new owner adding interest ?

 

Can you let us know which DCA this is? If you are concerned about posting the name on the public forum, you can private message it to me.

[dx100uk]

not link is it!!

 

they cannot charge interest 

 

however

 

tell more about the debt please

 

and name names

 

dx

[tedney]

Not Link!

 

Prefer not to give out too much info,

 

I have PM'd citizenB.

 

After a few years, DCA is chasing again now, so do not want identify.

 

Incidentally, an original agreement has not been supplied by DCA, as when I CCA'd the OC,

I got a letter from another OC who would have had no involvement with the running of the account when it was open!

 

I have the terms and conditions supplied when I opened the account, but not a signed agreement.

 

Should I ask for one again?

[dx100uk]

there is no need for secret squirrel

 

yes cca the chaser.

 

dx

[postggj]

i myself am looking into this as i am unsure,

 

If the account has been terminated by the original creditor, then assigned to a debt agency, i cannot see how they can charge post termination contractual interest. The rights might have been assigned to collect the outstanding balance, but not contractual interest as the agreement is terminated

 

We will then have the case if it was applicable for them to claim interest etc, they would have to send a notice of default sums to the debtor to be effectual to claim default sums if they are now the creditor by assignment

 

If the account was assigned as live, that is not terminated, then their will be no question that they can charge interest.

 

The only other avenue to explore would be if the original contract allowed the debt agency to charge post contractual interest

 

This is just my educated opinion and based on no supporting evidence, and is totally subjective in my reasoning

Edited May 12, 2013 by squaddie

[tedney]

Account certainly defaulted, and certainly closed by OC, I have that in writing.

 

Usual ignoring of correspondence by OC,

then I started monthly payments, as set out by CAB.

 

When this happened, I subsequently found out, (copy statements were sent nearly three years later) the account was marked "charged off",

and no interest added by OC from this time (charged off).

 

Payments to OC were continued, no statements forthcoming from anyone,

but subsequently (as above) payments recorded as received until one year later,

when copy statement from OC shows "Debt Sale".

 

No statements from anyone since, payments to OC continued, occassional letters from DCA with oustanding balance increasing,

and CRA's reporting increase, as well as monthly payments (of course less than sums addedd by DCA).

 

No correspondence from DCA since 2009, until now, when outstanding balance shown has increased about 50% over original sum,

this in six and half years since DN.

 

Monthly payments were accepted by the OC until about two years ago, when, without any correspondence or advice,

they are regularly returned by the bank!

[citizenB]

Have you retained the notices of the payments being returned ? Those would be very useful in proving that you have indeed been paying, they just aren't accepting those payments.

[tedney]

Yes, clearly shown on my bank statements, date and time and amount of payment, and corresponding amount shown as a credit from "suspense account" approx. two weeks later! This happens every month.

[BRIGADIER2JCS]

Have you obtained a copy of the agreement?

[postggj]

Remember people

 

Just because an agreement has been terminated by the original creditor, the rights to collect any outstanding balance still remain

 

Only a court or the creditor can end the agreement

 

It is just the rights to claim interest post assignment that i am debating. This is by a new creditor under assignment on a terminated agreement under contract

 

If a claim is issued in the civil court, a creditor can claim 8% statutory interest up to judgement from the time the claim was issued, and post judgement if the court allows

[tedney]

Have you obtained a copy of the agreement?

 

No, I sent a CCA section 78 request to OC last year,

got a response from another creditor,

quoting an alien account number,

and also had name and address issues with their response and

saying they destroyed my cheque (I sent a postal order - not cashed) quote

 

 

" As the details you provided do not match the details on our records, we are currently unable to respond".

 

 

needless to say I queried this and got an identical letter back.

 

 

I have not sent CCA to DCA though.

[tedney]

 

yes cca the chaser.

 

dx

Sent off and awaiting response! Thanks

[tedney]

I,very just had a letter from Cxxxx today saying that if I don,t make payments they will add interest...this is a very old Cities debt I,all be interested to see if they can do this

I have been making payments, and they are still adding interest.

[tedney]

Which DCA is this please, name them it will be easier to advise you.

Cabot

[BRIGADIER2JCS]

They tried these threats a few years back, and came unstuck I think, the interest I don't think is allowed unless the original agreement specifically allows it.

[tedney]

Ok, where might it be shown on the original please?

I have looked (I have "original" signed application) but cannot find any references to what happens in the event of default/closed as confirmed by OC

[tedney]

As I have not been receiving regular statements, is this in breach of the CC Act?

I have sent of request see post 13 above. Will wait and see. Seems to me I should stop payments:-)

[BRIGADIER2JCS]

As I have not been receiving regular statments, is this in breach of the CC Act?

 

Yes statement should be supplied at least annually.

[tedney]

Just thought, OC stopped interest after DN, I have copy statements, these statements also show payments in, reducing balances. Does this help in "fighting" interest added by DCA? Statements from OC stopped when account assigned to DCA.