Are you turning your back on emails and envelopes?

We all know that letters in e-Boks and window envelopes rarely contain declarations of love or poetry, but rather reminders of the trivial facts of everyday life. That's why it can be tempting to neither open nor read them.

However, this is a poor - and often expensive - strategy, especially if it's about owing money. In principle, it only takes a few weeks of inactivity for your debt to double. And in a matter of months, the debt can almost triple.

This is how fast debt can grow

In addition to the ongoing interest charges, debts are subject to a fee of DKK 100 each time a reminder is sent. In most cases - but not all - you will receive three reminders before your debt becomes a debt collection case, which means the costs will be significantly higher.

Dunning letters can be sent at 10-day intervals. The third reminder will warn you that your debt is now only 10 days away from becoming a debt collection case. In principle, this means that it only takes 30 days from the first reminder until your debt has grown by 3 x 100 DKK plus collection costs.

Example: From 1,150 to 3,050 kr.

Let's say your original outstanding debt was 1,150 DKK and the company you owe money to has handed over the collection of the debt to a debt collection agency. Then, 30 days after the first reminder is sent, your total outstanding debt will be 1,150 DKK plus 300 DKK plus 850 DKK plus interest.

If you still don't respond, the matter can be brought before the bailiff court, which will cause the debt to grow by at least another 750 kroner. This means that your bill has grown from DKK 1,150 to a total of DKK 3,050 plus interest.

How to avoid unnecessary costs

Fees and collection costs are set by law, so it doesn't matter if your debt is handled by Collectia or another collection agency.

The interest rate varies from case to case and depends on the specific contractual relationship you have with the company.

"Most of us don't want to confront ourselves with unpleasantness. But especially in the case of outstanding debt, it always pays to respond to a reminder letter immediately," says Jesper Sjøstedt Østendahl, debt advisor at Collectia.

"And this is also - or perhaps especially - true if you are not able to pay the full amount outstanding. We can almost always find a solution that is ultimately cheaper than just walking away."

Do you have a case with Collectia?

If you have a case with Collectia, we recommend that you log in to www.mitcollectia.dk with MyID. Here you can not only get an overview of your outstanding debt, you can also pay or request an installment plan. Alternatively, you can call us on 7730 0000. Our lines are open Mon-Thursday 08:00-16:00 and Friday 08:00-15:30.