Bill Collection Horror Stories Pt. 1

And you thought your debt collection agency was bad! A website recently made a list of bad debt collection experiences and these were among the worst of the collection. Karen Garrett, the public relations coordinator for Pittsburgh-based nonprofit Advantage Credit Counseling Service felt that she had heard it all until her agency received a call from a senior citizen late last year. She had called in tears and told Garrett that bill collectors had called her and told her that they had the police outside. If she did not pay, they were going to drag her to jail.

Debts are a civil matter, not a criminal one, and jail time is not even a retribution for failing to pay delinquent bills. “It’s extremely important for consumers to know that there is no such thing as debtor’s prison” Garrett says, rolling her eyes and smiling.

If bill collectors are making unlawful threats like physical violence, deportation and jail time, you can always report the harassment to the Federal Trade Commission or to your state attorney general’s office. The Federal Fair Debt Collection Practices Act prohibits bad behavior by third party collectors. These people do not follow the same rules as those who are collecting for the creditors directly. They are not allowed to call you at your place of employment if you ask them to stop, publish or threaten to publish your debt, reveal to anyone else that you may have a debt, harass you on the phone or use profanity. The laundry list continues.

They can’t use loss of child custody, deportation, illegal punishment like jail, or physical harm. They cannot call your home before eight AM or after 9 PM or even call at all if you have already written a request asking them to cease contact, or if you’ve hired a lawyer.

One older woman from New Jersey owed $12,000 in credit card debt after placing every day living expenses on her card. The bill collector called and informed her that they were going to take her home. She was also informed that they were not willing to take a penny less than the $12,000 she owed, and furthermore, they wanted it now. She tried to scrape up the money herself but couldn’t. “Debt collection companies are very intelligent when it comes to doing research. They will threaten targeted assets like a home or income source. But in many states, homes are protected from debt collection,

Mallory Megan works for a debt collection agency. She also writes stories on business, finance, consumer spending and collection agencies.

The Skinny On Debt Collectors

Debt collectors, or bill and account collectors’ job is to try to collect payment on bills that are overdue. Many debt collectors are hired by third party collection companies. The creditor, or the business or company that is owed the debt, will often hire outside of the company; especially if their accounts receivable department is small.

Other collectors work straight for the original creditors; these people are known as in house collectors. Generally these are finance-based businesses like mortgage and credit card companies, health care providers or utility companies.

No matter what entity they work for, the goals of debt collectors are the same. First, they’re called upon to locate people or businesses that are in debt, and let them know that they are delinquent. Usually this will be over the phone, but sometimes they send letters.

When debtors (people in debt) move without leaving a forwarding address, bill collectors might check with telephone companies, the post office, credit bureaus and former neighbors to get the new address. This practice is called “skip tracing.” They will utilize computer systems to automatically track when companies or people change their contact information or addresses on any of their open accounts.

Once the bill collectors locate debtors they tell them about the delinquent accounts and request payment. If it’s needed, they will go over the terms of sale, or credit contracts. A good bill collector is a sneaky one. They’ll probably use their listening skills to try to figure out the cause of the delinquency.

Usually, they will have the authority to offer a repayment plan or some other aid to make it easier for people to pay off the money that they owe. Sometimes they are able to find solutions to the financial problem. They may even give useful advice or refer people to debt counselors.

Mallory Megan works for a debt collection agency. She also composes articles on business, finance, consumer spending and collection agencies.

A Brief Explanation of Bankruptcy And A List Of DONT’S Part 1

Let’s face it, filing for bankruptcy is a big deal. It\’s the most extreme of all financial makeovers, and financial analysts continue to warn us that it should be a last resort that should not be entered into without knowing what you are doing.

Bankruptcy is etched onto your credit report for a full ten years. One decade. And without an adequate credit report, it can put a damper on your ability to obtain a car, living situation or employment. If you are filing, do your best to plan for your bankruptcy.

In the U.S., there are five chapters of bankruptcy that you can file for. The most common form is Chapter 7. A trustee will collect non-exempt property and will sell it and distribute the proceeds to the creditors. Chapter nine is a bankruptcy that is only available to municipalities. It’s pretty much a form of reorganization, not liquidation.

Chapter eleven, twelve, and thirteen are more involved because under these chapters, the debtor gets to keep some or all of her property while they use her future earnings to pay off the debt. Most consumers file chapter seven or chapter 13. Chapter 11 filings are mostly for businesses, individuals are allowed, but are rare. Chapter twelve is similar to Chapter 13 but is only available to “family farmers” and “family fisherman” in certain situations.

And now its time for the list of bankruptcy DON’Ts.

First off, don’t use your credit cards once you’ve made this decision. It’s just a bad idea to incur even more debt that you don’t intent to repay. It makes you look suspicious, and you could lose your right to cancel out the debt in the bankruptcy. Thing is, there were bankruptcy reforms in 2005 that lowers the threshold on so called luxury purchases to five hundred dollars and extended the abuse period to ninety days before filing. Anything you buy in this period will be under extra scrutiny.

Mallory McGuinness works for a collection agency. She also writes articles on business, finance, the credit industry and debt collection.