Before we start - I live in Australia.
Today I came home from work ill… and I am so glad I did because earlier this evening I received a call from a lady at a collection agency.
She mentions a debt that I apparently had in 2000 with a company that was bought out by another company who I didn’t pay and thus her company bought the debt. Now given that the original debt was in 2000 and therefore eight years ago I would normally be covered under what’s known as “statute barred”, which from what I can gather means that I can’t be taken to court. Apparently I made a payment to this account in June 2005 which restarted the clock.
Now I am fully prepared to admit the original debt which totaled $2200 (according to this lady that rang today ). However she told me today that since then they have been charging me interest on that amount of 27.5% and now the debt is $4000 (which makes no sense if you do the math).
I asked her why the account is still accruing interest charges if the account had been written off and bought by a debt collection agency. She advised me that it was in the terms and conditions I originally signed (in 2000). I asked if the account was still active at all, she said that it was classed as “on hold”. Tomorrow I plan to call the company that apparently now holds this account and ask why I haven’t received as statement for an account that is on hold. By law, in Australia, you must receive statements on any account that you hold with a bank or financial institution that is not closed.
So after all that my question here is: can a collection agency legally charge me interest on a debt that they have purchased?
:edit: I’ll also note that this debt does not appear on my credit history at all. I’m not sure if that means that the debt is classed as “statute barred”.