Creditor have the right to charge off delinquent and overdue accounts and sell the accounts on the debt market to third-party debt collectors and debt collection agencies. When sold, the agency that bought your account is the legal owner and has the right to try and collect the debt. This does not mean they can just do anything they want with the account.
Collectors cannot just add additional interest and fees to the account. They must follow either the original credit contract or state law. If state law exists, then it takes precedence over the credit contract. For instance, some states limit the collector’s fee to certain amount and prohibit collectors from adding additional interest.
It’s in your best interest to check your credit contract and your State and Local Government Laws to see which applies to your situation.
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