New York Times:
Just in time for a recession, the debt collection industry is working to shed its reputation for remorselessly hounding people.
Oh, the collectors still want the money. But now they would like to be seen as helpful and sympathetic, even a force for good.
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Screen your calls. Don't talk to them at all if you can help it. If you must talk to a collector be calm and keep it simple. "No I wont send you ANY money now and I wont promise to send any money in the future because the little money I have is for food and I don't make promises I cant keep". "Yes I acknowledge the debt and when I am able I will pay it". Rinse and repeat. Remember, they get NOTHING. Not one dollar, not one cent, NADA!! Typically, they will try to intimidate you because thats what works best. Remember, collectors are cowardly weasels who make their living threatening people on the phone. They cant hurt you. They are just a voice on a wire.
Debt collectors are bottom feeding scum. It's all a numbers game. The credit card issuer keeps adding maximum allowable interest, late fees, over limit fees, etc for 3 to six months, in some cases taking a $2000 debt to over 4 or $5000 before writing it off as a bad debt on their taxes. They then sell these "bad debts" in bundles to debt collectors who pay pennies on the dollar for the debt. Then the harassment begins. Many will ignore the state statute of limitations on unsecured debt and if the debtor talks to them or sends them a penny, they will "re-age" the account to keep it from going past the statute limitations. If they can get a few dollars out of you, they've made a profit. They'll then resell your debt or come back later for more. Unfortunately, if you own a home or anything of value, they will get a judgment against you on record. If you own nothing in your name and make a low wage, you are essentially "judgment proof" and they will eventually leave you alone. The original debtor gets nothing that is collected because they sold the debt. Your credit is still ruined and will remain so for years. Learn your state's statute of limitations on unsecured debt and avoid these scumbags like the plague. They play dirty and all they want is your money. In most cases the original debtor has retrieved the principal in excessive interest from the debtor before write-off and from the government after write-off. Learn to play their game and give them nothing for their efforts. Most of all remember, they are not your friend.
One more thing. The lady at the end of the article made a mistake. He got $100 from her she wouldn't have had to pay. Six years meant the debt was at or over the average statute of limitations limit. Now her debt has been "re-aged" and the clock starts over again. He was slick because he knew he'd get nothing in court, so he kept her outside, now he's got $100 profit and maybe a $100 or so more before the debtor stops paying again. I'll bet he's laughing and joking back at the office about how he suckered this women (bet he calls her a sucker or dumb broad) out of at least $100. If the original debtor settles and the the balance is written off, it's reported to the IRS as income for the debtor and taxes will be due. Talk about insult to injury! Know your rights! Learn the rules of the game. These people will suck the very life blood out of you if you allow them too. This poor women was judgment proof and that debt would have probably just gone away in a few more weeks or months. Had it been me, I probably wouldn't have shown up like the others. But if I had I would have told him where to stick his file.
They see the next president and congress as unfriendly to creditors and their hired goons, and rightly expect that legislation is coming to limit their tactics. The only way to avoid the worst is to improve their image now at the last minute. Creditors were reasonable in the 90s, but have become jerks since bankruptcy was taken off the table.
Know your rights:
http://www.ftc.gov/bcp/conline/pubs/credit/fdc.shtm
As the economy weakens, expect this image enhancement to fall quickly by the wayside as families can no longer afford to sleep under a roof, eat AND sevice their debts. Debtors prison may be coming back, folks.
Mm. Good luck with that, you soulless ghouls.
So debt collectors are going to try to massage blood out of a turnip, rather than squeezing it out?
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First Posted: 03-14-08 12:35 AM | Updated: 03-28-08 05:12 AM