'My child's school handed me over to a debt collector. What can I do?'

'They've blacklisted me.' (Photo: Getty Images)
'They've blacklisted me.' (Photo: Getty Images)

The following question is part of Groundup's Answers to your questions series and comes from a reader who had been unable to pay school fees and wondered if it was legal for the school to hand the matter over to debt collectors. 

My child's school handed me over to a debt collector. What can I do?

The short answer

The school does have a right to hand over unpaid fees to debt collectors if a parent has not applied for a fee exemption.

The whole question

In 2017 my daughter's fees were behind by R2,700. In 2018 I managed to pay the arrears and the new fees.

The school had handed me over to debt collectors who called me and instructed me to pay into their account. I refused because I don't owe the school money anymore.

I went to the school to sort out the matter. But the school said it can only transfer the money back into my account so that I can pay debt collectors directly. I refused and now they have blacklisted me.

The long answer

The school does have a right to hand over unpaid fees to debt collectors if a parent has not applied for a fee exemption.The debt collectors are paid a percentage of the amount collected, and they charge service fees for collecting.

You need to find out when the school handed over the outstanding 2017 school fees to a debt collector. If it was before you paid the school, the debt collector has the right to be paid, not the school, since the school no longer owns the debt, but has passed it on. It’s not clear then why the school accepted the outstanding fees if it had already handed over the case to the debt collectors, and you should ask the school to explain.

Debt collection is regulated by the National Debt Collection Act 114 of 1998. Although debt collectors can charge admin and collection fees, these are limited by law.

You have a legal right to a statement of the amount owed and how it was calculated. It is also possible to ask for a discount on the collection fees and apparently this is often granted, though they can refuse to negotiate. After your debt is paid, the fact that you had outstanding debt will stay on your credit record for five years, although it will show as “paid off”.

Answered on Feb. 6, 2019, 12:11 p.m.

Published originally on GroundUp

© 2019 GroundUp.

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