Debt recovery and enforcement

Debt recovery by a debt collection agency

What action will a debt collection agency take against me?

A debt collection agency will first send or give you a notice. The notice will ask for the debt to be paid and tell you that if it isn’t paid, you’ll get a bad credit rating and will be taken to court to have the debt enforced.

Debt collectors must not mislead or deceive you by stating that you will definitely be responsible for court costs and legal fees if the matter is taken to court. Whether you’ll have to pay those costs and fees will be up to the court to decide.

Can a debt collection agency charge collection fees?

A debt collection agency can charge fees over and above what you owe, but only if you were told about those fees at the time that you bought the hire-purchase goods or got the loan. The fees must be reasonable.

If you’re not happy about the fees you’ve been charged, you can ask the debt collector to explain them. You can also compare them to what other debt collection agencies charge. If you think the fees aren’t reasonable, you can apply to the Disputes Tribunal and ask it to reduce the fees (see the chapter “The Disputes Tribunal”).

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