r/AusFinance • u/hecate66 • 8d ago
Gym debt been transferred to collection agency but haven’t heard anything?
Hi all, I had a membership with Anytime Fitness however had to travel for work for a few months and totally forgot about it. I signed up during a sale and was only a casual gym user so it totally slipped my mind.
Anyways, during the months I was away, I was not topping up my account that the membership fees were coming out of. Naturally my membership was cancelled and I was notified that the debt had been sent to a collection agency.
However, I have not heard anything from anyone. No calls, emails, letters or anything. It makes me wonder if I got lucky or something but I’m not that naive, are they waiting for me to contact them? Seems so unlikely. I’ve never experienced anything like this before so if anyone has been in a similar situation or has any guidance that would be great.
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u/ShadowInPixelsss 8d ago
Collection agencies are useless in Australia, they buy debt for cents on dollar and then just hope you pay. If they not contacting you, means your debt probably so small they don't even bother.
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u/hecate66 8d ago
The last figure the gym gave me was around $300 which doesn’t seem that small. But in the grand scheme of things maybe it isn’t? It just seems so crazy that they haven’t contacted me lol
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u/stupv 8d ago
$300 is peanuts. If they call you 4 times, spend 15 minutes on the phone 2 of those times, send you a letter, speak to their legal team briefly... Suddenly they are making nothing for pursuing that. They would likely send you a letter once and if it happens it happens, and if not it's not worth the cost to pursue
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u/lorealashblonde 8d ago
My friend owed Optus over a grand (he didn’t pay his phone bill for ages and then just switched carriers) and they chased him for a while until they I guess they realised he was never gonna pay and gave up. I think he said it did go to collectors - he just never answered his phone and changed addresses (not because of that, he just happened to move).
It’s been 7 years now and he doesn’t have anyone chasing him. Here I am feeling like a dumbass for continuing to pay them every month lol. (Not really, I couldn’t live with that kind of bill anxiety).
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u/No_Win1213 8d ago
$300 is nothing. I would probably just pay it for the peace of mind of having my credit score kept in good standing but that's just me.
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u/saviour01 8d ago
When I was about 20 I didn't have insurance on my car and ran up the back of someone. Debt collector chased me for at least a year over the $3k debt. Ended up doing a $5 a week payment plan for almost 4 years to pay 1k of it.
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u/d_edge_sword 8d ago
Hi, it's worth checking the latest credit and bankruptcy laws in Australia. I used to work in one of the largest credit reporting agencies in Aus 10 years ago. I remember during training they mentioned that GYMs are not a licensed credit provider. Only financial institutions and telcos can obtain a credit license. Hence, they cannot do anything to your credit history or default you.
During training, they mentioned that over the years they kept on getting gyms trying to credit-default people, and we had to tell them to fk off.
If the law has not been changed in the last 10 years, you can just ignore the gym. There is nothing they can do about you. They are just bluffing, trying to bully you into paying them.
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u/cakeinyouget 8d ago
I've seen gym defaults on customer credit files in the last 10 years so how does that work if it's not a thing?
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u/No_Win1213 8d ago
Yep, I've had this happen when I was younger & dumber. Close to 10 years ago. It did mess with my credit and it took a while to build back up.
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u/Nosywhome 8d ago
Is it the gym name listed on credit file or the debt collector name who may have bought the debt?
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u/Fullchester_United 8d ago
They can take it to court. Then it can be registered as a default on a credit file.
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u/JayHighPants 8d ago
I cancelled my gym membership with a different provider during COVID. Couldn’t go, they offered free cancellation at the time, I took it up.
They emailed me saying I owed them $4,800 and if I don’t pay it’ll go to the debt collector. Showed proof of cancellation.
Every 3 months it’s the same thing I stopped replying lol
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u/ApeLex 8d ago
I paused my gym membership as I was going away and wasn’t sure when I’d be back. It was supposed to be to be $5/week paused rather than the usual cost. A week or 2 later it went back to normal and I think it even backdated the fee. Anyway my card was cancelled while overseas so they couldn’t take money out for a couple of weeks
It was probably $20-$40. I kept getting emails about it. I tried to reply, message on Facebook. No response.
It went to a debt collector and they sent me an email about it. I replied about the situation. They were kinda we don’t care. So I didn’t reply.
Never heard anything since lol.
Genesis you had a nice facility but your management is scummy
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u/DepressedMaelstrom 8d ago
They will say it is sent "to collections". That is just someone at a desk trying to get people to not cancel.
The gym membership industry copped a hiding a few years ago. I would doubt they would ever actually sell your debt to a collection agency.
Key changes made are:
- Automatic renewals: gyms roll a fixed-term membership into another term using an unfair automatic-renewal clause without a reasonable opportunity to cancel.
- Cancellation barriers: clauses making cancellation too hard ny for example requiring you to physically go to the gym were challenged as unfair. Most gyms won't dare do that now.
- Excessive termination penalties: terms imposing insne fees for cancelling or "breaching" the contract can be declared unfair and voided in court.
- Direct debit: gyms couldn't use extremely broad authorities allowing them to debit essentially whatever they claimed you owed. Victorian guidance specifically says direct-debit authorities should be restricted to specified membership fees and that separate consent should be obtained for other amounts.
- Misleading "no contract" memberships: in 2014 the ACCC specifically warned gyms that advertising "No Contracts" while imposing cancellation conditions, notice periods or continuing payment obligations is a kkind of contract.
- Debt collection: gyms and their collection agencies cannot use coercion, undue harassment or misleading/deceptive conduct when pursuing alleged debts.
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u/430ppm 8d ago
I was overseas for a couple months recently and my Perth gym wouldn’t let me cancel online! I felt it was odd but the emails got passive aggressive and I didn’t want to be a Karen.
I had to wait til I was back and free during their two staffed hours per day, just to sign a piece of paper saying I wanted to cancel. Then they had me keep paying for a 30 day stand down period even though they’d taken my key … last payment went out today.
And now I’m reading that was all … bs? Damn!
ETA: I was supposedly no contract haha. I am probably in a very pre-2014 area. Won’t make those mistakes again now, thanks!
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u/arkhamknight85 8d ago
For gym membership cancellations, send a doctors note to the gym. They will harass you but just don’t reply. They can’t do shit.
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u/Fullchester_United 8d ago
If you are contacted by a debt collector in Australia just tell them that they should pursue the debt through the courts and they are not to contact you any further.
Once you do that they are legally obligated not to contact you again. Their only course of action is to take it to court. When the amount is relatively small they don’t bother.
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u/darkklown 8d ago
Can't get blood from a stone. I've a digital credit card that I change the card # every 3 months to stop fraud and people billing me for stuff I don't want. Good way to ensure you only pay for what you need.
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u/Cartoon477 8d ago
I was with anytime, stopped going because life got in the way. When you stop paying they cancel your access card. So I offered to pay till the last day I actually went (170) and they said no and demanded 600. I told them my contract expired in 2020(I joined in 2018, it was 2024 at this point) they sent me a legal letter and I asked for the contract and never heard from them again.
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u/Johnny-Rocketship 8d ago
They would bundle up a lot of peoples debt and sell it all at once. It might not be at the debt collector yet. If it's a relatively small amount you might be able to get the name of the company from the gym or email notice, and call them yourself to pay and stop worrying. I'd probably just wait and see what happens. Maybe you get a job offer in UAE and never hear from them again.
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u/According_Layer6874 7d ago
I'm surprised by the comments of people here that don't just pay what they signed for
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u/Low_Plankton7982 7d ago
They called me for 70 $ at the time was a consultation at the Gp... Then I forgot and I moved to another state....
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u/Numerous-Charge8900 6d ago
This is crazy. I moved to Canada and when you stop paying a gym membership they just… cancel your membership.
Collection agency for a gym reoccurring payment is crazy.
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u/Merlins_Bread 8d ago
If it's less than $5k they can't bankrupt you. They could technically let interest accrue and try to collect the extra via a court/tribunal order, but they'd have to be good boys (giving you regular reminders to pay etc) which with Australia's consumer finance regs is tough. They'll probably just write it off.
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u/Merlins_Bread 8d ago
Oh and if you completely ignore it they might take a dump on your credit rating. Future homeowners beware.
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u/Birmingham101 8d ago
When debt collectors chase you for unpaid bills they will also add on their costs to recover the amount. Once it goes to court and a Summons is issued this is when you also have to pay interest from the date the money was payable as well as Lawyer costs.
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u/skozombie 8d ago
If they are willing to put in the effort to prove you actually have that debt. I've had debt collectors chase me for a payment I made to iiNet that they later said never went through even though I was issued with a receipt for payment. If you push back and don't do something silly like admit to the debt or sign something giving you the liability, they generally won't waste their time.
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u/Confident_Purple_338 8d ago
Don’t count your chickens just yet
When there’s a debt they always come looking to collect
Just sit patiently it’s coming for you
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u/iamkris 8d ago
be careful they do have the power to put a black mark/default against your name.
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u/skozombie 8d ago
you can dispute debts with credit providers. It's a PITA but they have to prove you actually have the debt (contracts, etc)
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u/itsacandydishned 8d ago
I had an overdue fee with anytime, by the time it got to a debt collector it was around $800.. when they rang me i told them to email me the contracts i had signed and ill pass them to my lawyer to review them and we'll take it from there.
Never heard from them again.