Collections Law/Excessive Collection Fee?
Are the fees I'm being asked to pay by a law firm serving as a collection agency excessive?
In the last 18 months, I have experienced financial hardship, exacerbated by three deaths (Mom,Grandmom, and aunt), and by having to care for my aging father. I over looked paying the storage fee on embryos in cryopreservation. I've been paying on them for about 8 years, live in the same house, and didn't intend to lose sight of the obligation. When I resurfaced from my grief, I knew I needed to take action. I sent in two good faith payments directly to the fertility center, and when my tax refund arrived, paid my balance in full, in person, at the center. I didn't deduct the two good faith payments from the balance. I took it as 'penance'. At the time, no one referenced collections, or fees. I was in the billing office for half an hour. Simultaneously, the center had sent me to collections. I thought the envelope was junk mail, and didn't opened it until a second letter arrived. (Bad habit, I know.) So, in all, the collection agency/law firm sent two form letters-- one before I paid and one after I paid-- and after I paid, called me twice. They seemto be hurrying to file a lawsuit, as a third collection agency referenced a claim number, although i checked and rechecked and have gotten no notice to appear. Thisall happened literally within 24 hours of paying the bill. They claim I only made a partial payment. The fertility center charged $2,400 for storage, and $200 for late fees... Plus kept $100 beyond that total balance from my good faith payments sent. The collectors want me to pay them an additional $2,000... And that doesn't seem reasonable, or a fair debt practice. I know I should have called the fertility center and communicated proactively. I didn't. I own that, and I paid my debt. To complicate matters, a friend recently offered to be a gestational carrier at no cost. I just want to move forward with hope. I sent a cease and desist letter today, but have fears that this is going to get very ugly. Is the fee too much? Do I have to pay it? What can I reasonably do?
Whether the $2,000 collection fee is reasonable or legal depends on what the contract with the Cryocenter says. That is the governing document. Since you didn't actually pay them until after receipt of the first Collection Agency's (CA1) letter, a strong case can be made that it was the letter from CA12 that scared you into paying and therefore, if the contract allows it, the fee is due and payable.
On the face of it a $2,000 collection fee for a $2600 debt does seem a bit excessive. Without a copy of the Cryocenter's contract to read I can't give you any further advice. Talk with them. You have nothing to lose at this point.