Author Topic: Interest on Debt under £5000 and exsessive charges...  (Read 1158 times)


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Interest on Debt under £5000 and exsessive charges...
« on: May 21, 2011, 11:50:59 AM »
Hi everyone....I am new this forum so I dont really know the ins and outs, so I hope I am doing this right. Firstly, I apologise now for how long this post is going to be as theres alot to explain.....
Basically, in my second and third year of University  (2006-2008) I lived in private student accommodation (which I am not sure if I am allowed to name so I wont). Anyway, during my time there I missed a few rent payments which I was not aware of until I moved out- and totalled over £4500!!- I made a few payments towards the debt over 18 months and then could not afford to anymore so stopped making the payments. I know this was a big mistake, I was young and stupid and scared to ask for help. Anyway, I didnt hear from them for quite a long time (and I had moved out into a rented house by this point) so the naive part of me thought that I might have escaped it.
Anyway....on 24th March 2010 I was issued with a claim form for £3998.81 plus court fees and solicitors costs which totalled the claim to £4186.81. However, I didnt see this form myself until 4 weeks later as it was sent to an old address, so by the time I have got it, it was too late for me to take action.
The debt was then passed onto High Court Bailiffs who visited my home a couple of times while I was out and posted letters through my door. When I contacted the bailiff and the debt collection agency I was told that the debt had to be paid in full, which I could not do. I paid £100 and explained that I could afford to set up a payment plan for £200 per month, in which they declined and resumed bailiff procedures.
I sought advice from my local Citizens Advice Bureau and was told to apply for a Stay of Execution through the court in order to legalise a payment plan and hold off of any bailiff action.
I did this and now have the Stay of Execution and am paying the £200 per month with no problems...since October 2010.
What I am confused about is the extra charges they added on during the bailiff process as it has taken the debt to £5382.30. So that is over £1000 in charges added in around 8 weeks!!
Does this sound exsessive?
The man I spoke to in court suggested that I should appeal against them and a few other people I have spoken to (including a family friend who is a bailiff) have also questioned them and asked me to look into it.
If they are would I go about appealing to have them taken off?
Also...I have heard that interest cannot be added to debts of under £5000? Is this correct?
If so...does this include debts that are only over £5000 after charges being added? As my debt was orignally just over £4k and is only over £5k now because of all the charges the company have added on. It doesnt seem fair.
Please can someone advise me as to whether I should be receiving interested on this debt, as I am currently being charged 74p a day!! Thats over £22 a month just in interest!!
Its also not a percentage that I am being charged in that right? It was 74p on the original debt, and despite paying £200 a month for the last 8 months, which has lowered my debt amount...I am still paying 74p per day? I thought interest should be a percentage of the amount owed?
Does anyone know if this is right?
I am hoping that I can appeal against the charges and/or interest and hopefully that will help me repay the debt amount much quicker!!
I am very sorry for the essay! I just wanted to explain my situation fully. If anyone can help me or give me advice on whether I have a case or not and how to go about it, that will be great!
Thank you!


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Re: Interest on Debt under £5000 and exsessive charges...
« Reply #1 on: May 23, 2011, 07:43:41 AM »
Phone Business Debt line on 0800 127 6026 its free and confidential. they will tell you whether the fee's are excessive and whether or not you can apply to have them waived or at least reduced.

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James Falla

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Re: Interest on Debt under £5000 and exsessive charges...
« Reply #2 on: May 25, 2011, 04:21:06 PM »
Good advice from shocksoc. Why not have a chat to business line and see what they say. As far as I am aware, interest and charges can be added to debts of less than £5000. In addition, if a debt has gone to court, a county court judgement issued and then bailiffs engaged to enforce the debt, the additional costs added could well be considerable and I am not surprised that the origional debt has increased to the extent it has.
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