The usury law applies to consumer loans that are not related to a credit card debt, a retail installment contract or a consumer lease. According to RCW 19.52. 020(1) , a lender may, if agreed in writing between the lender and borrower, charge an interest rate at a maximum rate of 12% per year.
Collection agency fees - what are legal? Debt collectors can charge you interest, up to the maximum amount outlined in the original contract. It's generally listed as the “penalty rate” in credit card contracts and it can soar past 30 percent, depending on the creditor.
The FDCPA prohibits debt collection agencies from collecting interest, fees, charges, or expenses on the debt unless that amount is expressly authorized by the agreement creating the debt or permitted by law.
The Washington Collection Agency Act and federal Fair Debt Collection Practices Act prohibit harassment, false or misleading statements and unfair practices by collection agencies. If you believe a collection agency has unreasonably harassed or misled you, you can sue it. You could win damages and lawyer fees.
Almost all collection agencies will charge you interest, typically 12% per year, on debts they are attempting to collect. Interest can be charged regardless of whether you agreed to it in your lease or other contract.
Debt collectors cannot harass or abuse you. They cannot swear, threaten to illegally harm you or your property, threaten you with illegal actions, or falsely threaten you with actions they do not intend to take. They also cannot make repeated calls over a short period to annoy or harass you.
While agencies typically pursue the full amount owed, debt buyers may accept reduced payments. The decision to sue often depends on the debt's size (usually a minimum of $1,000), age, and original agreements. Debt collection practices for unpaid credit card balances frequently lead to court cases.
Do You Have to Pay Debt Collectors? Yes, if a debt collector has contacted you about a legitimate debt, you are legally obligated to pay it. However, it's essential first to verify that the debt is yours and the amount is correct.
Most states or jurisdictions have statutes of limitations between three and six years for debts, but some may be longer. This may also vary depending, for instance, on the: Type of debt. State where you live.
If you are struggling with debt and debt collectors, Farmer & Morris Law, PLLC can help. As soon as you use the 11-word phrase “please cease and desist all calls and contact with me immediately” to stop the harassment, call us for a free consultation about what you can do to resolve your debt problems for good.
It's impossible to say how much a particular debt collector will accept to settle a debt. Debt collectors typically settle for 30% to 60% of the total owed, but the percentage can vary based on factors like how old the debt is, the collector's policies, and your financial situation.
Can you dispute a debt if it was sold to a collection agency? Your rights are the same as if you were dealing with the original creditor. If you do not believe you should pay the debt, for example, if a debt is stature barred or prescribed, then you can dispute the debt.
There's no federal regulation on the maximum interest rate that your issuer can charge you, though each state has its own approach to limiting interest rates.
Current mortgage rates in Washington. As of Tuesday, January 14, 2025, current interest rates in Washington are 6.88% for a 30-year fixed mortgage and 6.13% for a 15-year fixed mortgage. The median home sale price in the state was up 4.4 percent year-over-year to $600,000 as of June 2024, according to ATTOM.
In California, absent an exception which we discuss in depth below, the maximum allowable interest rate for consumer loans is 10% per year.
Specifically, the rule states that a debt collector cannot: Make more than seven calls within a seven-day period to a consumer regarding a specific debt. Call a consumer within seven days after having a telephone conversation about that debt.
Debt collectors are not permitted to try to publicly shame you into paying money that you may or may not owe. In fact, they're not even allowed to contact you by postcard. They cannot publish the names of people who owe money. They can't even discuss the matter with anyone other than you, your spouse, or your attorney.
Payment May Not Update Your Credit Report. Even after paying a collection account, the collector might not properly update your credit report. The unpaid status could incorrectly remain, damaging your score indefinitely. This happens more often than you'd think.
The plaintiff might attempt wage garnishment or bank account levies. Some defendants might be considered “judgment proof” if they have no assets. Possible Outcomes and Future Collection: Judgments remain active for several years and could be renewed.
A creditor can't file a lawsuit if it's been more than four years since the last activity on the account. This is called a statute of limitations. If you have not made a purchase on or made a payment to the credit card account for more than four years, that debt is considered expired.
Even though your card issuer "writes off" the account, you're still responsible for paying the debt. Whether you repay the amount or not, the missed payments and the charge-off will appear on your credit reports for seven years and likely cause severe credit score damage.