What The Debt Collector Is Not Telling You

Complaints from consumers about debt collection tactics are at
their highest levels in history.  Many Americans are feeling
the heat of debt collection calls.  But in those calls there
are things that the collector won’t let you know and surely won’t
tell you.  Here are 6 items:

1.  They really don’t intend on suing
you.

Many consumers complain that collectors call them on the phone and
make threats to file a lawsuit.  If that threat comes from a
debt collection attorney, then perhaps this statement could be a
true statement if the attorney was hired to file the lawsuit by the
company that actually owns the debt.   However, in most
situations, this is not true.  What the collection agency is
not telling you is that they actually have no say in whether a
lawsuit could or should be filed.  That decision is to be made
by an attorney that has reviewed the file.  That collection
agency may refer the matter to an attorney, but the collection
agency say-so on whether the consumer will be sued ends right
there.

2. They really have to stop calling at work if they are
advised you cannot receive calls there.

Once a debt collector has any knowledge that a consumer cannot
receive these calls at work, the collector is no longer permitted
to attempt to call the person at their workplace.  The
Fair Debt Collection Practices Act
is very clear on this
point.  Moreover, this notice does not have to come in any
particular form.  It can simple be told to the collector
calling.

3. They cannot tell others, including your human
resources department, about your debt.

A common complaint we hear is that collectors are telling people
that they will contact their human resources department at
work.  Seemingly, this is to make one think about a possible
pending garnishment.  While a collector can make contact for
the sole purpose of setting up a garnishment where there is an
immediate right to such garnishment, any other contact is
prohibited by the
FDCPA
.  If the collector does not have a judgment against
a consumer, than any contact with a third party is governed by the
mandates of the FDCPA, and any disclosure of the debt being owed is
prohibited. 

4.  Your debt may be too old to actually do
anything about it.

Most debts, such as credit cards or auto loans, are made from a
contract.  When a creditor is not being paid, the ultimate
tool they have is the use of the court systems to file a breach of
contract case against the consumer.  However, every state has
a limit on how long a creditor has to assert a claim for a breach
of contract.  This is known as the Statute
of Limitations
.  Once the statute of limitations passes,
the collector is without the use of the court systems and cannot
obtain a judgment for the money.  Another collection tool they
like to use is credit reporting the debt.  Having negative
collections on one’s credit report could propel one to pay the debt
off.  However, there is a limit of time with which a debt can
be reported on a consumer’s credit report.  Once these dates
pass, the collector is without any power whatsoever.  Sure,
they legally can try to collect the debt, by using other persuasive
techniques.  However, without the use of the courts or credit
reporting, much of their power is gone.

5.  Debt collectors are under as much pressure to
collect as you are to pay.

Most debt collectors earn their pay on a commission basis. 
That is, they only get paid when they make you pay, and they only
get a small percentage of what they recover for their
boss.   If a debt collector is not convincing enough,
they are not going to make any money for themselves.  This
explains the aggressiveness.   Also, the collectors only
have a limited time to obtain payment before the account is taken
back by the creditor and given to another.   If they
don’t get you to pay in that short period of time, then they are
not going to be able to pay their own bills.  

6.  Paying off a debt will not help your credit
rating.

If a debt is being reported to the credit bureaus by a debt
collector, is has a great effect on your credit
rating.  Just its existence alone is harmful regardless if it
is being reported as paid or unpaid.  Making that payment will
not take the collection off your report.  It will still be
seen and still cause significant harm.