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Can a debt collector charge interest on my home security contract? (I defaulted).

Maricopa, AZ |
Filed under: Credit Debt

When my service was activated, I paid for the year with my credit card. On the contract it states "if you Choose the auto pay or credit card option you will be automatically be billed with no invoice". I selected no such option. Long story short, it fell into collections. The Collection company is charging me interest?? I see nothing on the contract about interest. Is it legal in Arizona that collection companies can charge interest on a non credit card collection?

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Attorney answers 2


Review the contract very carefully, sentence by sentence. If the contract says nothing about charging you interest, then the collection agency cannot charge you interest.

Send the collection agency a letter (a) stating the you dispute the validity of the debt; (b) requesting verification of the debt; and (c) requesting an account history of the debt. You are entitled to this information under the Fair Debt Collection Practices Act (federal law). When you receive the response from the collection agency, review it carefully. If there are interest is included in the calculation of the current balance due, then you should dispute those charges IN WRITING. When you eventually agree with the calculation of the current balance due, then you negotiate IN WRITING payment or settlement of the debt.

If my answer was helpful or the best answer, please mark it as such. Thanks.

The information contained in my answer is provided for informational purposes only, and should not be construed as legal advice.


The answer is it depends what the contract says. Read it VERY carefully.

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