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How does the Ca process begin  

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After reading many post about these CAs that dont follow the rules,harass and threaten people.I was wondering just how it all starts.Do the orginal creditors just sell past due accounts to anyone,and why is it that sometimes more than one CA will have your account.Most of the orignial creditors are legit companies,why would they use these crooks like Elis and Crosby for example.I have also heard that sometimes the orginal lender will take the debt back if you make payment arrangments with them,but the Ca will still try to collect.Sorry for so many questions,but I am really confused and would like to understand this process better. icon_confused.gif
Thanks in advance for anyones imput.
Twokid
 

asked Jan 6, 2006 09:31 PM

twokidtwocat
Best Answer
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best answer

Welcome Twokid icon_biggrin.gif

If you somehow manage to go to their website, or view their company profile, you can understand it. You could see the terms like ‘debt purchaser' or ‘debt seller'.

Once an account is reported as charge-off, original creditors are not likely to spend money for it. They consider it as bad debt, not collectable. So if you see a collection agency is intended to collect charge-off accounts, past SOL debts, this agency is supposed to be a debt buyer.

FYI, one agency can act as JDB and collection agency both. Hope this helps. Let's see if other members can give some more clues icon_biggrin.gif

answered Jan 7, 2006 11:42 AM

2 Answers

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Twokid,

Let me share the knowledge that I have gathered from this forum. Hope it will help you icon_biggrin.gif

When a debtor fails to pay his bills or goes default, original creditor either tries to get the money back through their own collection department or assigns some third party collection agency to collect it on their behalf.

Then the collection agency contacts the person over phone or through correspondence and asks him to pay the debt. debt validation is the first step of debt collection. Collectors should provide the detailed history of the account. Collectors should also show the evidence that they have the right to collect this account.

Once the debtor starts paying, collection agency is supposed to pay the amount to the original creditor.

Now some agencies are there known as JDB, junk debt buyer. They buy port folios from original creditors or lenders. These port folios contain huge number of delinquent accounts. Once the original creditor sells these accounts to the debt buyer, the buyer becomes the owner of those accounts.

Sometimes debtors feel uncomfortable to deal with collection agencies and try to settle the account with original creditor. What I feel, the original creditors do not show any interest to settle those accounts that are sold to debt buyers.

However, once an account is taken back from the collection agency, I do not think the agency has the right to collect it any more. If they continue to collect it then either they are careless or they are intended to cheat people.

There are instances where original creditor has cancelled contract with collection agency. If the creditor or lender receives huge negative feedback on the collection agency they work with, or the agency does not pay them regularly, they assigns some other collector to work on their behalf.

That was all form my part. Let's see what the other members say icon_biggrin.gif

answered Jan 7, 2006 09:22 AM

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Thanks so much Bryan,that is the best explaination anyone could have given.Thanks for taking the time to anwser my question. icon_smile.gif My only other question would be,how do you know which kind of CA your account was given to?

answered Jan 7, 2006 10:57 AM

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