Start My Answer

Can a Collection Agency Add Fees on the Debt?

Chloe Meltzer | December 02, 2022

Win in court against debt collectors.

Summary: Do you have a collection agency after you for an old debt? Worried they're adding additional fees to your balance? Find out what debt collectors can and can't charge to your account.

When a creditor sells your debt to a collection agency, it means that the collection agency now owns the debt. That agency has many rights but also needs to abide by different rules.

Debt collection agencies are legally allowed to add additional interest and fees to your overall balance. This eventually leads to the total amount being more than what you owed to the original creditor.

There are federal and state laws that govern how collections are handled. One of the federal laws is the Fair Debt Collections Practices Act (FDCPA). This law regulates many things, with one of them being the fees a collection agency can charge. Knowing these laws and how they affect you can help you to prevent being taken advantage of.

Don't let debt collectors push you around. Respond with SoloSuit.

Understanding the Fair Debt Collection Practices Act

The Fair Debt Collection Practices Act (FDCPA) is a federal law that governs how debt collectors may try to get you to pay a debt. Specifically, the FDCPA regulates the following:

  • Debt collectors are not allowed to lie or use deceptive tactics
  • May not call you at any hour of the day (only between 8 am and 9 pm)
  • You may ask a debt collector to stop contacting you, and they must comply.

The FDCPA applies to third-party debt collectors, but not original credit card companies. Each state also has its own protections as well. In some cases, the same laws that govern the FDCPA may also apply to original creditors depending on state laws.

Pick the right affirmative defense with SoloSuit.

Can a collection agency add fees on the debt?

Under the FDCPA, if a debt collector is attempting to collect on your debt, they need to do so according to the original contract you signed. This contract refers to the one you signed with your original creditor. Even though this debt was most likely purchased from the original creditor (or someone else who had purchased it from the original creditor), the terms are passed down through the chain of ownership.

It is important to know this because a debt collector cannot add fees to your debt without permission from the courts. This means that you will need to have a judgment placed upon you before any fees are added.

How to avoid a judgment

To avoid fees being added to your debt, you should avoid a judgment. This can be done with a few actions. First off, you want to ensure that you respond to the debt. If you respond to the debt, then you will go through the process of being able to fight your debt. If you do not respond properly within the allotted period, then a judgment will be placed against you.

The debt collector will then be able to seek to collect fees on your debt. In some cases, this includes costs for collection efforts, such as phone calls, mailings, and even legal expenses. Despite this, they will only be added on after a judgment is issued by the courts.

File a response to a debt collection lawsuit in 15 minutes with SoloSuit.

Interest fees may be added to outstanding debt

There is one main exception in regards to collecting fees on your debt, and this is interest. There is always an interest rate that is clearly stated in your original contract. Interest rates are defined and should be straightforward.

Any time you are dealing with a debt lawsuit, you should keep full copies of your written contractual agreements. This will ensure that you have proof of the fees that can legally be added, including your interest rate. Should there be any questions regarding terms of payments, you will have this to back yourself up. It could prove helpful in court.

Filing a lawsuit against a debt collector

Although expenses related to the lawsuit like court filing fees and service fees can be added to your total if a judgment is placed against you, you may have options. Legal fees associated with the lawsuit can only be added if you have been sued, and if a judgment is placed against you If a judgment has not been placed against you, then you may be able to file a countersuit.

For example, you may sue a debt collector who has violated the FDCPA. In this case, you may recover any damages because of this violation, but you may also be awarded up to $1000. It is also common that the debt collector will drop their original debt collection suit against you in hopes that you will settle the case or drop it altogether.

What is SoloSuit?

SoloSuit makes it easy to respond to a debt collection lawsuit.

How it works: SoloSuit is a step-by-step web-app that asks you all the necessary questions to complete your answer. Upon completion, you can either print the completed forms and mail in the hard copies to the courts or you can pay SoloSuit to file it for you and to have an attorney review the document.

Respond with SoloSuit

"First time getting sued by a debt collector and I was searching all over YouTube and ran across SoloSuit, so I decided to buy their services with their attorney reviewed documentation which cost extra but it was well worth it! SoloSuit sent the documentation to the parties and to the court which saved me time from having to go to court and in a few weeks the case got dismissed!" – James

Get Started

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

>>Read the NPR story on SoloSuit: A Student Solution To Give Utah Debtors A Fighting Chance

How to answer a summons for debt collection in your state

Here's a list of guides for other states.

All 50 states.

Guides on how to beat every debt collector

Being sued by a different debt collector? We're making guides on how to beat each one.

Win against credit card companies

Is your credit card company suing you? Learn how you can beat each one.

Going to Court for Credit Card Debt — Key Tips

How to Negotiate Credit Card Debts

How to Settle a Credit Card Debt Lawsuit — Ultimate Guide

Get answers to these FAQs

Need more info on statutes of limitations? Read our 50-state guide.

Why do debt collectors block their phone numbers?

How long do debt collectors take to respond to debt validation letters?

What are the biggest debt collector companies in the US?

Is Zombie Debt Still a Problem in 2019?

SoloSuit FAQ

If a car is repossessed, do I still owe the debt?

Is Portfolio Recovery Associates Legit?

Is There a Judgment Against Me Without my Knowledge?

Should I File Bankruptcy Before or After a Judgment?

What is a default judgment?— What do I do?

Summoned to Court for Medical Bills — What Do I Do?

What Happens If Someone Sues You and You Have No Money?

What Happens If You Never Answer Debt Collectors?

What Happens When a Debt Is Sold to a Collection Agency

What is a Stipulated Judgment?

What is the Deadline for a Defendant's Answer to Avoid a Default Judgment?

Can a Judgement Creditor Take my Car?

Can I Settle a Debt After Being Served?

Can I Stop Wage Garnishment?

Can You Appeal a Default Judgement?

Do I Need a Debt Collection Defense Attorney?

Do I Need a Payday Loans Lawyer?

Do student loans go away after 7 years? — Student Loan Debt Guide

Am I Responsible for My Spouse's Medical Debt?

Should I Marry Someone With Debt?

Can a Debt Collector Leave a Voicemail?

How Does Debt Assignment Work?

What Happens If a Defendant Does Not Pay a Judgment?

How Does Debt Assignment Work?

Can You Serve Someone with a Collections Lawsuit at Their Work?

What Is a Warrant in Debt?

How Many Times Can a Judgment be Renewed in Oklahoma?

Can an Eviction Be Reversed?

Does Debt Consolidation Have Risks?

What Happens If You Avoid Getting Served Court Papers?

Does Student Debt Die With You?

Can Debt Collectors Call You at Work in Texas?

How Much Do You Have to Be in Debt to File for Chapter 7?

What Is the Statute of Limitations on Debt in Washington?

How Long Does a Judgment Last?

Can Private Disability Payments Be Garnished?

Can Debt Collectors Call From Local Numbers?

Does the Fair Credit Reporting Act Work in Florida?

The Truth: Should You Never Pay a Debt Collection Agency?

Should You Communicate with a Debt Collector in Writing or by Telephone?

Do I Need a Debt Negotiator?

What Happens After a Motion for Default Is Filed?

Can a Process Server Leave a Summons Taped to My Door?

Learn More With These Additional Resources:

Need help managing your finances? Check out these resources.

How to Make a Debt Validation Letter - The Ultimate Guide

How to Make a Motion to Compel Arbitration Without an Attorney

How to Stop Wage Garnishment — Everything You Need to Know

How to File an FDCPA Complaint Against Your Debt Collector (Ultimate Guide)

Defending Yourself in Court Against a Debt Collector

Tips on you can to file an FDCPA lawsuit against a debt collection agency

Advice on how to answer a summons for debt collection.

Effective strategies for how to get back on track after a debt lawsuit

New Hampshire Statute of Limitations on Debt

Sample Cease and Desist Letter Against Debt Collectors

The Ultimate Guide to Responding to a Debt Collection Lawsuit in Utah

West Virginia Statute of Limitations on Debt

What debt collectors cannot do — FDCPA explained

Defending Yourself in Court Against Debt Collector

How to Liquidate Debt

Arkansas Statute of Limitations on Debt

You're Drowning in Debt — Here's How to Swim

Help! I'm Being Sued by My Debt Collector

How to Make a Motion to Vacate Judgment

How to Answer Summons for Debt Collection in Vermont

North Dakota Statute of Limitations on Debt

ClearPoint Debt Management Review

Indiana Statute of Limitations on Debt

Oregon Eviction Laws - What They Say

CuraDebt Debt Settlement Review

How to Write a Re-Aging Debt Letter

How to Appear in Court by Phone

How to Use the Doctrine of Unclean Hands

Debt Consolidation in Eugene, Oregon

Summoned to Court for Medical Bills? What to Do Next

How to Make a Debt Settlement Agreement

Received a 3-Day Eviction Notice? Here's What to Do

How to Answer a Lawsuit for Debt Collection

Tips for Leaving the Country With Unpaid Credit Card Debt

Kansas Statute of Limitations on Debt Collection

How to File in Small Claims Court in Iowa

How to File a Civil Answer in Kings County Supreme Court

Roseland Associates Debt Consolidation Review

How to Stop a Garnishment

Debt Eraser Review

Do Debt Collectors Ever Give Up?

Can They Garnish Your Wages for Credit Card Debt?

How Often Do Credit Card Companies Sue for Non-Payment?

How Long Does a Judgement Last?

​​How Long Before a Creditor Can Garnish Wages?

How to Beat a Bill Collector in Court