• Collection agencies’ activities
• Payment instalments
• Enforcement
• Costs of collection
• Payment default entry and credit report
• Purchase of receivables
• Other frequently asked questions
• Questions associated with Lindorff

Collection agencies’ activities

I am behind on my payments, but I have not yet received a collection letter. Can I already do something about it?

Yes you can. It is not good idea to wait for the collection letter, as every letter generates additional costs. If you can’t pay immediately, contact the company or service provider that you have conducted business with and suggest a new payment date or payments in multiple instalments. It is usually possible to get an extension for making payments, if you initiate contact in time and explain your situation.

I have received a collection letter from a collection agency. Has an entry been made in my credit report?

An entry has not been made. An entry will not be made into your credit report until the collection proceeds into the legal phase. Learn more about the collection phases in the Did you receive mail section.

However, there is an exception: if the matter is of a consumer credit line over 60 days past due (for example a credit card payment or instalment), the creditor can directly submit the information to the credit information register. Even in these cases, you will receive at least one collection letter prior to the entry being made.

How does the collection process proceed?

Learn more about the collection phases in the Did you receive mail section. There you can also get tips for what you can do in different situations. Information regarding collections for companies is located in Small and Medium-Sized Enterprises.

What is a demand for payment?

A demand for payment is a collection letter sent by the collection agency after the payment reminder letter.

A demand for payment states the name and contact information of the creditor and the collection agency, the payment obligation or contract to which the debt is based on, the balance of the debt, interest, penalty interest and itemised collection fees. In addition, the demand for payment includes wire transfer information and the possibility to comment on the amount of the debt or its basis.

According to the law, the amount for one written payment demand cannot exceed

• €21, if the amount being collected is no more than €250
• €45, if the amount being collected is more than €250
• €12, if the receivable is directly eligible for enforcement.

What are receivables directly eligible for enforcement?

Directly eligible receivables are fees by public authorities. The debt collector can deliver these directly to the enforcement without a district court order.

Fees of this type include:

• taxes
• fines, parking tickets, inspection fees, and other penalties
• municipal social welfare fees
• municipal health-care fees
• municipal waste fees
• municipal soil extraction permit
• municipal zoning or building inspection authority fee
• high school fees
• fees caused by basic art education directed to children or youth
• education institution fees from liberal education
• vocational institution fees
• the commissioning costs handled by the municipality (based on the Conditional Fine Act and Building Act)
• fees charged from fishing association members
• dog tax
• state-subsidised loans (issued after 1 January, 1994)
• mandatory traffic insurance policies

Examples of municipal social welfare fees

• day-care fees for children
• home care fee
• resident service fee, transport service fee
• child protective fee

Examples of health-care fees

• clinic fee
• hospital emergency room fee
• medical transport fee
• institutional care fee
• ambulatory surgical procedure fees
• laboratory and x-ray fees
• dental care fees
• occupational health-care fees
• medical certificate fees
• fees charged for unused services

Liberal education institutions

• adult education centres
• folk high schools
• learning institutes
• sport training centres
• summer universities

The invoice collected by the collection agency is incorrect. What can I do?

If you deem that the balance or basis of the invoice is incorrect, contact the collection agency without delay. As more time passes, it is increasingly difficult to provide proof of a potential error. At Lindorff, the issue is cleared up with the invoicing company as soon as possible. Collection efforts are interrupted while the claim is being processed.

I received a letter from the collection agency, but I have never received the original invoice. What can I do?

It could be that the sender of the invoice did not have your current address or the mail was lost in transit. If you have moved, ensure that you have notified the Population Register Centre. It is also a good idea to also notify companies that you receive invoices from of your new address information, as they are not required to verify the information from the Population Register Centre.

However, contact the collection agency right away to address the issue. If the original invoice and payment reminder letter have been delivered to your old address, you usually still have to pay the incurred collection costs, in addition to the invoice.

Why have we received two collection letters concerning the same payment, one addressed to my spouse and one to me?

Agreements can be made with joint and several responsibility by several persons, for example, both spouses. Typical examples of such agreements include electricity supply agreements, leases and loan agreements. The parties who have jointly entered into the agreement are also jointly responsible for any outstanding payments related to the agreement.

According to good debt collection practices, it shall be ensured that all responsible parties are informed of the neglected payment; therefore, the requests for payment, i.e. payment reminder and payment demand letters, are addressed individually to each responsible person.

The payment requests concern the same case and have fully identical invoice numbers and information; only the payment reference number differ from each other. Once the invoice is paid using the payment information on any of the request letters, the issue is taken care of.

When can the debt be transferred to a collection agency?

According to good debt collection practices the debt can be transferred to actual collection after the invoice is past due, at least one payment reminder has been sent and the customer has had sufficient time to pay the invoice or notify of an erroneous invoice.

Lindorff also offers companies and associations invoicing and payment reminder services, so an invoice may be handled by Lindorff immediately following the business transaction.

Can debts owed to private individuals also be given to a collection agency to handle?

In addition to companies and associations, Lindorff also offers services to private individuals. If you have a receivable that requires help from an expert, please contact our sales contact persons.

If one moves abroad, will the collection letters follow?

Moving abroad does not resolve payment problems. If they have the address information, collection agencies will send the letters to wherever the debtor lives. The enforcement can also extend abroad.

How long can collection agencies collect on unpaid invoices? When does the debt expire?

A creditor or a collection agency handling the issue on their behalf can collect on a debt until it expires.

The final expiration of a debt is 15 years from the liability ruling by the district court or other implementation basis. Exceptions to the 15-year expiration are situations where the creditor is a private individual or the debt is based on a crime. In these instances the debts expire in 20 years. The time can also be extended by 10 years with a district court ruling, if the debtor has made it significantly difficult for the creditor to be able to collect on the date, or has otherwise taken improper action.

Please note that the final expiration of the debt is calculated from the court ruling date , not from other dates such as the invoice due date or when it was transferred to collections.

If the debtor is not reminded at all of the debt with collection letters, for example, it will expire in 3 years from the debt falling due.

Taxes, legal insurance premiums and other public receivables directly eligible for enforcement expire 5 years after the year the during which the debt was invoiced.

What to do when unable to work together with the collection agency? Where can I make a claim about the actions taken by the collection agency?

The authority that oversees collections is the State Provincial Office of Southern Finland, which issues the permits to offer collection services to companies.

The regulations in the Act on Debt Collection are overseen by the Consumer Agency Ombudsman when the collection involves consumers. Personal advise, instructions, and mediation help can be sought from the Consumer Advisor at the Consumer Agency.

Payment instalments

Can payment instalments be agreed on with the collection agency? What size instalments can the debt be divided into?

Yes they can – the issues can usually be settled on, if you only contact the collection agency. Explain your situation and suggest a payment plan. Make a suggestion that you can live with. The number and sizes of instalments can usually be agreed with flexibility.

Read more about it in the section titled Payment plan.

What happens if I make a payment plan instalment late or do not pay it? Can the due date still be postponed or only a part of the instalment be paid?

If you have agreed on paying the debt in instalments, and you do not adhere to the agreed instalment amounts and due dates, the payment plan is dissolved automatically and the remaining debt balance continues to be collected on. It may not be possible to agree on new due dates and amounts, at least not after the fact.

It is always a good idea to ask what can be done! If you cannot pay as agreed, initiate contact well before the due date of the instalment.

The payment plan should always be set as one that you can live with. Read more about it in the section titled Payment plan.

Will I get a payment default entry if a payment plan made with the collection agency is dissolved and the collection agency notifies me of its intention of taking the issue to the district court?

Dissolution of a payment plan does not cause a payment default entry as such. However, if the payment plan is agreed upon a consumer credit which is over 60 days past due, the payment default entry can be recorded to your credit report immediately after the payment plan is dissolved.

Once the payment plan is dissolved the remaining debt will still be collected on. When a ruling is sought from the court that confirms liability for paying the debt, the ruling will result in a payment default entry in your credit information.

Learn more about the collection phases in the Did you receive mail section.

I have received several collection letters and I would like to handle them all at once. Can I agree on a single payment plan for multiple different invoices?

Yes you can. Contact the collection agency and we will assess your overall situation with you. You can agree on a payment plan with Lindorff for all of your debts being handled by Lindorff. Technically invoices from only one company can be included in a single payment plan, but you can still agree on a payment schedule and instalments that suit your situation with a single phone call.

If you would like to first assess your situation yourself, please ask for a debt summary from our customer service department. We will send you a written summary of your debts being handled by Lindorff.

Can instalments that have been agreed in with the collection agency be paid in advance? How does that affect collection costs?

Instalments can be paid in advance. Similarly, the balance of the debt can also be paid at once. The earlier you pay off your debt, the less penalty interest you have to pay. In addition, costs incurred from the payment plan are reduced. If you have agreed on a payment plan with Lindorff, and you end up making a payment exceeding the agreed amount, please remember to notify Lindorff customer service of doing so. This ensures that there are no misunderstandings over the issue.

Read more about it in the section titled Payment plan.

Enforcement

What does the enforcement mean?

Enforcement usually means the collection of debt owed to a creditor. The enforcement is administered by a public official, who is closely associated with the court. At court, the accuracy of the creditor's receivable is verified and a decision is made on the debtor’s liability for the balance. If the court order is not voluntarily adhered to, it is implemented through collection proceedings.

In addition to collection letters, the methods used in the enforcement include liens on wages and property.

When a payment or invoice is received by the enforcement authority for processing, an initial processing notice is sent. In addition to the payment information, the notice states the contact information of the enforcement authority handling the issue. If the debtor is unable to pay the debt and does not contact the enforcement authority to make arrangements for a voluntary payment plan, further action is decided on based on the information obtained by the administrator.

The enforcement authority can collect directly from wages, pension or business income or sell assets subjected to the enforcement.

Read about costs incurred during enforcement in the section titled What costs are incurred during collection?

Are collections and the enforcement the same thing?

Collections include all actions that are intended to get the debtor to pay the outstanding debt, which is owed to the creditor. Collections are administered by invoicing parties and creditors, companies offering collection services and public enforcement authorities.

Invoicing parties, creditors, and companies specialised in collections aim to get the debtor to pay off the debt voluntarily. If the payment is not paid voluntarily, a court order is sought for it, which confirms the obligation to pay off the liability. The order is executed through enforcement. In addition to collection letters, the methods used in enforcement include liens on wages and property.

Learn more about enforcement in the section titled What does enforcement mean?

How quickly is the issue transferred from the collection agency to the enforcement authority?

The time between initiating collections and transferring the matter to enforcement is usually approximately 1.5 - 3 months. Prior to that, several payment reminders and demand for payment letters are sent regarding the unpaid invoice. Learn more about the collection phases in the Did you receive mail section.

Can the same invoice be transferred from enforcement to the collection agency?

Yes it can. If no income or assets are found during the enforcement, the authority deems the debtor insolvent and returns the issue to the collection agency. The collection agency can continue collecting the debt on behalf of the creditor using demand of payment letters and later resend the debt to the enforcement. This can occur as long as the debt can be legally collected or it is paid.

Also see the section titled When do debts expire?

Costs of collection

Who pays the costs incurred from using a collection agency?

The debtor pays the costs incurred from the collection. The right to collection costs is based on the law. According to the Act on Debt Collection, the debtor must reimburse the creditor the costs incurred from collection, regardless if the invoicing party is collecting on the debt themselves or if a third party collection agency is used.

Costs are incurred, for example, when verifying address information, obtaining registrations, sending letters, negotiating with the customers, payment monitoring and handling.

What costs are incurred during collection?

The amount of the collection costs to be paid by the debtor depends on how far the collection proceedings have went and the size and type of the invoice.

The costs increase when moving from voluntary collection (collection letters) to the legal phase and potential enforcement. Learn more about the collection phases in the Did you receive mail section.

Costs of voluntary collection

The costs incurred during voluntary collection from consumers have been defined in the law.

Payment reminder costs are legally set to a maximum of €5 per reminder letter.

Demand for payment demand costs:

According to the law, the amount invoiced for one written payment demand cannot exceed

• €21, if the amount being collected is no more than €250
• €45, if the amount being collected is more than €250
• €12, if the receivable is directly eligible for enforcement.

The total amount invoiced for a single debt’s voluntary collection efforts cannot exceed.

• €190, if the amount being collected is no more than €250
• €220, if the amount being collected is more than €250
• €59, if the receivable is directly eligible for enforcement.

If completing the collection has been exceptionally difficult and the actions have not been unreasonable in proportion to the debt being collected, the debt collector can demand additional costs that exceed the total incurred cost amount.

Court costs

The amount of incurred court costs is determined by the amount being collected and the amount of work required to handle the issue.

Court costs are adjusted annually by a regulation set by the Ministry of Justice. The costs include attorney fees and expenses incurred by the debt collector, such as phone, post, and copying expenses.

• court costs €134, if the debt being collected does not exceed €250 and the work amount is normal
• court costs €218, if the debt being collected does not exceed €250 and the work amount exceeds the normal amount
• court costs €168, if the debt being collected exceeds €250 and the work amount is normal
• court costs €258, if the debt being collected exceeds €250 and the work amount exceeds the normal amount
• court costs €168, if the case involves an eviction

The costs paid to court by the creditor are added to aforementioned expenses when demanded:

• €60 in cases where the applications for a summons is send to the District Court electronically
• €80 in cases where the applications for a summons is send to the District Court by other means in other words on paper

The aforementioned costs apply for undisputed debt collection issues. If the amount of the debt or the reasons are being disputed, and the issue is to be handled at the court as a regular disputed issue, the court costs increase several fold, due to additional costs such as attorney fees.

Costs of enforcement

The enforcement charges a fee for every payment made through the recover proceedings.

The so-called scheduled fee depends on the amount of the delivered payment. The fee is levied from every wage or pension payment subject to the enforcement or the sales price received from property sold through the enforcement. The same fee is also charged for voluntary payments, including when the debt is being paid off in instalments, in accordance with a payment plan agreed on with the enforcement authorities.

Scheduled fees (from 1.11.2009):

Collected receivable or a part thereof:

• up to €14 = fee €2.50
• over €14 and up to €27 = fee €5
• over €27 and up to €67 = fee €7
• over €67 and up to €165 = fee €12
• over €165 and up to €335 = fee €27
• over €335 and up to €670 = fee €56
• over €670 and up to €1,680 = fee €84
• over €1,680 and up to €8,400 = fee €134
• over €8,400 = fee €210

In addition to the table fee, the enforcement charges an auction fee for buildings, shares in housing company, and other tangible assets sold through judicial auctions during the enforcement (building and allocated lot size = €841, shares in housing company etc. = €336).

For implementing evictions, instalment plans, and security actions (repossessions), an implementation fee is charged as the enforcement fee:

• home eviction = €84
• other eviction = €168
• for instalments, when the item value is up to €840 = €84
• for instalments, when the item value exceeds €840 = €168

The enforcement fee is not charged when the debt being collected is caused by maintenance allowance, a fine or a penalty.

An example of the costs with a €1,000 debt: collection agency vs. enforcement

10-month payment plan with collection agency:

A 10-month payment plan is made of the €1,000 debt with the enforcement authorities. The monthly instalment would then be €100, to which the collection agency’s costs are added (€10 for creating the payment plan, €5 per payment). Thus, the final balance is 10 * €100 + €10 + 10 * €5 = €1,060 (+ penalty interest).

10-month payment plan with enforcement:

A 10-month payment plan is made of the €1,000 debt with the collection agency handling the enforcement. Thus, the monthly payment is €100, to which the enforcement fee of €11.50 is added (see above), in accordance with the fee-table. The enforcement fee is paid for every monthly payment. Therefore, the final balance will be 10 * €100 + 10 * €11.50 = €1,115 (+ penalty interest).

Can the agency collect on collection fees after the fact, even though I have already paid the original invoices?

Yes they can. The collection of Collection costs and penalty interest continue until all costs caused by the late payment are paid.

I have paid the invoice. Why must I pay collection costs for an invoice that has already been paid?

The applicability of collection costs depends on the time of making the payment and commencing collection measures. According to Lindorff's procedures, collection begins when a payment reminder or payment demand is sent.

In practice, this means that if you have paid the invoice after the payment reminder letter has been sent (after the date of the letter), the creditor has already had additional expenses due to the delay in your payment. This is why you must pay the collection fees and interest on arrear specified in the payment demand using the payment demand’s reference and bank account data, even though you have already paid off the original invoice.

Read more about such cases in the Did you receive mail section.

Is it less costly to pay the debt off through the collection agency or enforcement?

It is less costly to pay the debt to the collection agency than through enforcement. In most cases, the collection agency’s fees for setting up the payment plant and the instalments are lower than the table fee paid to it through enforcement. Learn more about establishing a payment plan and enforcement fees in the section titled What costs are incurred during collection?

In addition, as the collection proceeds to the enforcement through court, this results in a significant increase in collection costs. Penalty interest is also accrued for the entire time.

It certainly is not advantageous to wait for the enforcement to avoid costs. The earlier you contact the collection agency and agree on making the payment, the lower the total costs will be in the matter.

Payment default entry and credit report

What is a payment default entry?

A payment default entry results from an unpaid invoice,

• when the court has ruled on it
• when the enforcement authority has deemed the debtor insolvent
• or from a consumer credit line that is past due over 60 days and of which the consumer credit line issuer has notified the credit report registry administrator (e.g. credit card cancellation, not paying an instalment).

A payment default entry is recorded in the credit report registry, where the information will be stored from two to four years, depending on the degree of the default. In Finland, credit report registries are maintained by Suomen Asiakastieto Oy and Dun & Bradstreet Finland. Asiakastieto Oy notifies of the first payment default entry by sending a so-called first-time registry notification.

A consumer credit payment default entry (credit card cancellation, neglecting to pay an instalment, a revolving account payment, or a one-time credit payment)

• Requires that the creditor sends the debtor a written payment reminder where the debtor is reminded that neglecting to pay the invoice may result in a payment default entry Requires that the payment reminder must be sent a minimum of 21 days prior to making the payment default entry The payment must be over 60 days past due from the original due date
• Kept on record for two years.

Collection ruling (a ruling from the district court, which confirms the debtor‘s obligation to pay off the liabilities)

• Kept on record for three years. The time can be shortened to two years, if the debt is paid off and the individual does not have other entries in their credit report. The duration the entry is kept on file can be affected by sending a receipt of paying the debt off to Suomen Asiakastieto Oy’s consumer advisory services. In contrast, the time the entry is kept on record is extended to four years, if an additional payment default entry is recorded for the individual when the initial one is in force.
• Certain public fees are directly eligible for enforcement without a ruling from the district court. A payment default entry will not be recorded for neglecting to pay them, unless the customer does not make payments on them even through the enforcement. Read more about them in the section titled What are receivables directly eligible for enforcement?

Insolvency deemed during enforcement, the so-called insolvency entry

• An insolvency entry will result from the enforcement only if the individual does not have assets to make payments on the debts or the individual is not reached.
• Kept on record for three years. The time can be shortened to two years, if the debt is paid off and the individual does not have other entries in their credit report. The recordkeeping time can be affected by sending a receipt of paying the debt off to Suomen Asiakastieto Oy’s consumer advisory services. In contrast, the time the entry is kept on record is extended to four years, if an additional payment default entry is recorded for the individual when the initial one is in force.
• Insolvency deemed during limited enforcement is removed from the registry as soon as the debt is paid and the creditor advises the credit information company of payment.

Debt restructuring

• Court-ordered debt restructuring or a voluntary arrangement made together with the creditors.
• Debt restructuring entries are kept on record for two years, or until the payment plan is completed.

Judicial auctions

• Judicial auctions filed in the publication register.

What is an insolvency entry?

An insolvency entry is one of the payment default entries made in the credit report. If suitable income or property is not identified during the enforcement, the administrator deems the debtor insolvent. Insolvency deemed during enforcement results in a payment default entry in the credit report.

The matter is then returned from enforcement back to the creditor of the collection company handling the collection. They can then continue the voluntary collection of the debt through demand for payment letters and later resubmit the dent to recover proceedings.

Read more about it in the section titled What is a payment default entry?

How many collection letters will I receive before it reflects negatively on my credit report?

Prior to the payment default entry, the invoicing party, collection agency, and officials send several letters and you have many opportunities to initiate contact and agree on paying the invoices through, for example, a payment plan.

The credit information company usually does not record the first entry until the district court has made a collection ruling on it. In this case, you have received a minimum of two, but often at least three payment reminder letters and the subpoena. Learn more about the collection phases in the Did you receive mail section.

When does the collection agency make an entry into my credit report?

The collection agency does not make entries for consumers into the credit report registry. The credit information company records a payment default entry for an unpaid invoice

• when the court has ruled on it
• when the enforcement authority has deemed the debtor insolvent
• or from a consumer credit line that is past due over 60 days and of which the consumer credit line issuer has notified the credit report registry administrator (e.g. credit card cancellation, not paying an instalment).

Read more about it in the section titled What is a payment default entry?

How is a payment default entry placed in the credit report?

The credit information company maintains payment default information for consumers from district courts, recover proceedings administrators and financing and credit card companies that have issued consumer credit lines.

Read more on the subject in the Did you receive mail section and in the section titled What is a payment default entry?

Will it ruin my credit, if I make a payment plan with the collection agency and adhere to it?

A payment default entry is not made for agreeing on a payment plan. In contrast, agreeing on a payment plan is a way to avoid the collection from continuing and a payment default entry that results from a district court ruling. Please note, however, that if the issue has already been transferred to the court using a subpoena application, creating a payment plan will no longer prevent a ruling and the resulting payment default entry.

Therefore, be sure to contact the collection agency in time! With Lindorff, you can agree on a payment plan that suits your situation.

Read more about it in the section titled Payment plan.

I have received collection letters, but my credit report is in order. Can old collection issues affect obtaining a new credit line, telephone line, or a rental unit?

If you have not received a payment default entry and your credit report is in order, the collection letters do not have an effect when you conduct business with other companies or, for example, the municipality. Delayed payments are not recorded in public registries and they are only known by the creditor.

Please ensure that you pay all invoices in collections in time to avoid entries in your credit report. Learn more about the collection phases in the Did you receive mail section.

Will it ruin my credit if a debt or a short-term loan is submitted to a collection agency for collection?

No it will not. Transferring the debt to a collection agency does not result in a payment default entry in the credit report.

The finance company, credit card company or short-term loan company that issued the credit line notifies the credit information registry of an unpaid credit line, if it is over 60 days past due and at least one payment reminder has been sent.

Read more about it in the section titled What is a payment default entry? What is a payment default entry?

Will I loose already issued credit lines or cards, if I get a payment default entry?

A payment default entry does not usually affect credit lines already agreed on and in force, but it can result in you not being able to obtain a new credit card or line.

Read more about it in the section titled What is a payment default entry?

An a minor ruin their credit?

Yes, as a person of 15-18 years of age can be deemed insolvent by the enforcement and this is recorded in the credit report. Other credit report entries cannot be made for minors.

How does one know that an entry has been made in the credit report or that the report has been cleared?

You can check your credit report using Suomen Asiakastieto's for-fee internet service (available only in Finnish). In addition, you can check your credit report once a year free of charge by sending a written request to do so. You can print the request form from Suomen Asiakastieto’s website

The statement you will receive will show if you have had payment defaults, where they have come from, and who has requested your information.

When the first payment default entry is made in your credit report, the credit information company will send a notification to your residence. The letter states, for example, how long the entry is to be kept on file.

What consequences can a payment default entry have?

Several companies and associations assess a client’s reliability as a debtor using the credit report. For example, a payment default entry will often prevent once from obtaining a credit card, instalment credit line, or a rental unit or even ordering a product off the internet without providing advance payment.

A credit report entry also makes opening a phone line or electricity or insurance account more difficult. In these instances, companies usually require an advance payment or security deposit, if the customer has payment default entries.

The entry can also result in difficulty obtaining a job or gaining admittance to an educational institution, when particular reliability is required for the position.

I have paid off the invoices associated with the payment default entry. Does this also clear my credit report?

The payment default entry will remain on file in your credit report, even if you have paid the debt. Only the insolvency entry deemed during limited enforcement, will be removed at your request.

However, paying off the debt can shorten the time the entry is kept on record. Even if it does not affect the time the entry is kept on record, a note stating that the debt has been paid can be included with the payment default entry. This can help you the next time when a bank or landlord, for example, checks your credit report.

In any case it’s worth while to deliver a proof of payment to the credit information register, that is to Suomen Asiakastieto's consumer information.

Read more in the section titled What is a payment default entry?

Can payment default entries be seen by creditors abroad?

Yes. Companies and associations abroad can also check your credit report from a Finnish credit information company’s registry.

Purchase of receivables

I received a letter informing me that my debt has been assigned to a collection company. What does this mean?

Creditors can sell their receivables, for example, to a finance house or a company specializing in the purchase of portfolios, such as Lindorff Invest Oy (formerly Balancon Assets Oy), which is Lindorff's Finnish subsidiary.

The change of creditor does not impair your rights or increase any payment obligations. Moreover, it does not affect any previously agreed payment plans or debt restructuring arrangements.

Naturally, the biggest change is the fact that you will be paying out your debt to a new creditor.

When a creditor's receivables are sold to Lindorff, we inform the debtor of this. The purpose of the notification letter is to inform the debtor of the change of creditor's right and different ways to settle the debt.

With one creditor collecting several companies' debts, you have better possibilities to combine debts and agree on payments and costs.

Lindorff’s customer advisors handle debtor counselling and payment arrangements concerning receivables owned by Lindorff’s subsidiary Lindorff Invest. Contact us to see what we can do for your case! See here for the customer service contact details.

What is the selling/purchasing of portfolios actually based on?

Selling receivables is one way for companies to manage credit losses and improve cost-efficiency. Selling overdue receivables enables the company to release resources to its core business and the provision of service to its existing customers.

Receivable portfolios are sold to a party that has the highest value for the debts, typically a debt collection company. The buyer benefits from this transaction, because the specialization in managing large volumes of receivables makes it better equipped to maintain contacts with the debtor customers and to seek long-term, individual payment solutions based on the debtor's overall standing.

The debtor's position does not change in the transaction: the change of creditor does not impair the debtor's rights or increase any payment obligations. Usually, the purchase of portfolios enhances the debtor's possibilities to make payment arrangements and settle the debt.

What kinds of portfolios are being traded with?

The portfolio purchases usually involve overdue receivables, most of which have been in collection unsuccessfully for a long time. A typical portfolio purchased contains several hundreds or thousands of consumer receivables that have been subject to collection for years. The price depends on the estimated certainty of receiving payment from the debtor customer

Which instance supervises these transactions?

The purchase of portfolios constitutes a bilateral agreement based on the creditor's legal right to assign the receivable to a third party. The collection of the debt, both before and after the purchase of portfolios, is governed by the Collections Act and good collection practice.

Collection companies are supervised by the State Provincial Office of Southern Finland, which grants debt collection licences. In collection cases involving consumers, the Consumer Ombudsman oversees compliance with the Collections Act.

How does the change of creditor affect the debtor's position?

The purchase of portfolios does not affect the debtor's position; it does not impair the debtor's rights or increase any payment obligations. The biggest change is the fact that the debt will be paid to a new creditor

The purchase of portfolios usually improves the debtor's possibilities to agree on payment arrangements and, eventually, pay off the debt. For example, one in five receivables collected by Lindorff's subsidiary, Lindorff Invest, results in voluntary payment arrangements every year.

Nearly all portfolios purchased by Lindorff have been subject to collection by Lindorff for the selling company before the purchase, which means that there is an existing customer relationship with the debtor.

Will the selling of my debt incur any extra costs?

Selling the debt to Lindorff will not incur any extra costs to you. We aim at finding a sustainable payment solution that suits your overall standing and solvency.

If we cannot reach a payment agreement, we will continue collection as usual. The collection measures do generate some additional collection costs, but these costs are regulated by the Debt Collection Act, and there is a statutory maximum limit on those. Read more about the maximum limits of collection costs.

Other frequently asked questions

Can my children end up having to pay my debts? Can debts be inherited?

Heirs, estate stakeholders, are responsible for the debts only by using assets of the deceased. The debts are included in the probate and they are paid off using assets in the estate.

The inheritor can only have to pay off the debt, if the probate process is intentionally not handled, incorrect information is provided, or information is hidden.

Is there a legal maximum amount for collection costs?

Yes. In accordance with the Act on Debt Collection, the total amount invoiced for a single debt’s voluntary collection cannot exceed

• €190, if the amount being collected is no more than €250
• €220, if the amount being collected is more than €250
• €59, if the receivable is directly eligible for enforcement.

If completing the collection has been exceptionally difficult and the actions have not been unreasonable in proportion to the debt being collected, the debt collector can demand additional costs that exceed the total incurred cost amount.

What is penalty interest?

Penalty interest begins to accrue from the due date of the invoice. The general penalty interest rate is the reference rate set by the European Central Bank + 7%. The penalty interest rate is defined semi-annually. Currently, the general penalty interest rate in Finland is 8,5% (1.7.-31.12.2011).

If the general penalty interest rate is lower than the agreed rate on the loan or credit line, the regular interest rate is charged as the penalty interest for the time the invoice is past due. After 180 days the interest charged will fall to the level of general penalty interest.

With situations with particular payment difficulties, it is possible to agree on alternative penalty interest arrangements. These situations include illness, unemployment, or other specific reasons that are significant and well-justified.

Can I transfer the collection from Lindorff to another collection agency?

Lindorff collects on the debt for its customer, the company or association that issued a credit line or sold without advance payment. The company has selected Lindorff as its service partner for the receivables. The customer that is subject to collection attempts for the unpaid invoice cannot transfer the matter to another company.

Questions associated with Lindorff:

Where does Lindorff get my information from?

Lindorff gets your information from its client, the creditor issued a credit line or sold without advance payment. We also verify your address information with the Population Register Centre and your credit report with the registry maintained by Suomen Asiakastieto Oy and your recover proceedings information from the associated officials.

How can I contact Lindorff?

You can contact us using the method you prefer:

E-mail

Enter the customer number included in the letter into the subject field and send the e-mail to: palvelu@lindorff.fi

Telephone

Call the customer service number stated in the letter you received or our customer service line at 02 2700 300.

Our customer service department is available between 8 AM and 8 PM on weekdays and 10 AM to 3 PM on Saturdays. The price of the call is the normal local or long-distance charge.

Chat

Using our Chat service, you can be in real-time contact with our customer service professionals with issues pertaining to collections, payments, and payment plans. Initiate connection here.

My Lindorff Internet service

Using My Lindorff service, you can review your debt situation, make a payment, postpone a due date or create a payment plan using your banking services access codes (Service available only in Finnish). Go to My Lindorff service.

The Internet service does not show matters in the enforcement or older issues that have once already been collected via mail. When you need the information of all debts being handled by Lindorff, we will send you a written summary.

How soon can Lindorff see my payment? How do I confirm my payment to Lindorff?

Once you have made your payment to Lindorff, it will be visible to Lindorff within 1–3 banking days. If you have made the payment to the original creditor, or if you want to inform Lindorff of your payment sooner, provide us with a receipt of the payment.

Provide Lindorff's customer service with a receipt of your payment as follows:

• by fax: 02 2700 350
• by e-mail (e.g. in PDF format): haastemaksut(at)lindorff.fi

In addition, we ask you to call our customer service at 02 2700 300 to immediately confirm the payment data you have sent.

The following types of electronic receipts are accepted:

• a receipt printed out from your online banking service in PDF format, or
• a screen shot of the online bank receipt. (Instructions: Using the Print Screen key, paste the image to a word or image processing application, e.g. to a Word document. Save the file in .doc, .jpg or .pdf format and send to us as an e-mail attachment.)

Does Lindorff have a service centre where I can visit in person?

Lindorff’s head office is located in Turku, near the Kupittaa station. There is a service centre located at our head office, where you can obtain personal service.

Joukahaisenkatu 6, 3rd floor
Open weekdays 8 AM - 4 PM

From elsewhere in Finland, you can contact us using the telephone, e-mail, or through the My Lindorff Internet service. View the contact information for our customer service department.

How do I know what invoices are currently being collected on?

You can request a summary of your debts being handled by Lindorff from our customer service department. We will deliver you a written summary to your home address within two weeks.

Can I handle collected debts on behalf of my spouse/adult child? How does this work?

You can handle issues related to invoices and collection on behalf of another adult, such as your spouse or child, if you have authorisation from this person.

The authorisation must be given in the form of a written power of attorney. The power of attorney can be specific or open but it must indicate the names and personal IDs of the person granting the authorisation and the authorised person, as well as the signature of the authorising person.

Example: ”With this power of attorney I, Evelyn Everywoman, personal ID, authorise Eric Everyman, personal ID, to sort out and agree on matters related to my debts/my outstanding payment to Company Ltd. on my behalf. This power of attorney shall remain valid until dd.mm.yyyy. Date and signature.”

When dealing with Lindorff, you can submit a power of attorney

• by fax to Lindorff’s Customer Service, number +358 2 2700 350
• by e-mail as a scanned attachment file to palvelu@lindorff.fi
• by post to Lindorff, Customer Service, P. O. Box 21, FI-20100 Turku.

Authorisations concerning a single invoice can also be submitted to our customer service by telephone. However, in matters involving debts to banks, financing companies and insurance companies we always require a written authorisation.

What issues can be handled using the My Lindorff Internet service?

My Lindorff is an Internet service that can be used to pay a Lindorff invoice, extend a due date, make a payment plan or send us a message. You will not need separate access codes for the Internet service. Instead, it utilises the banking access codes issued by Nordea, OP-Pohjola Group, or Sampo Bank. (Service available only in Finnish)

The service can be used to handle matters currently being collected on by Lindorff via mail. It does not show invoices that you have received a payment reminder on or debts that have already been moved into the enforcement or older debts. When you need the information of all debts being handled by Lindorff, we will send you a written summary.

When you pay a Lindorff invoice using the My Lindorff Internet service, the payment is instantly recorded in the Lindorff system. This can be of help with urgent matters.

Go to My Lindorff service.

I have tried to call your customer service number, but I have been unable to get through.

Unfortunately, our customer service number may occasionally experience high call volumes, particularly during the beginning of the week. We hope that you have the patience to wait for a customer service professional or can try again.

While waiting, you can review your situation yourself on this site. You can also send us e-mail or handle the issue using a Chat customer service professional or through the My Lindorff Internet service.

What is Lindorff Invest Oy? How can I contact it?

Lindorff Invest Oy is Lindorff's wholly-owned Finnish subsidiary that is specialized in the purchasing and managing of debt portfolios in Finland.

Lindorff, with its experts and customer advisors, handles the collection of receivables owned by its subsidiary, as well as debtor counselling and payment arrangements. Contact us to see what we can do for your case! See here for the customer service contact details.

Specialized in managing large-scale receivables, Lindorff is better equipped to maintain contacts with the debtors and seek payment solutions based on the debtor's overall standing even on a long-term basis. One in five receivables collected by Lindorff Invest results in voluntary payment arrangements every year.

What is Balancon Assets?

Balancon Assets is the former name of Lindorff Invest. The name was changed in the beginning of 2011. The new name, Lindorff Invest, indicates more clearly that the company is Lindorff's subsidiary and that Lindorff is the instance providing assistance and service in matters related to debts owned by Invest.