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About collection agencies

Submitted by Morningstar on Sun, 03/25/2007 - 17:04
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About collection agencies


When collectors are trained, many call centers require that the agent not give up control of the call. They are trained to be assertive, demanding, and to talk over the debtor during an argument. They are also taught to refer back to any and all possible consequences of non compliance. It is illegal for them to threaten any action they do not intend to or cannot take (a common, illegal threat is to prosecute the debtor for fraud).

Collection agencies are not permitted to call excessively, although the law likely differs from an individual’s opinion as to the definition of excessive. Should you tell a collector that you are going to try to obtain the money in the next few days; the collector will schedule a callback. If you do not call back, the collector will do so starting from the scheduled time/date, and continue for approximately a week. If you have made a promise to pay an amount, the collector will again set a callback time/date. In the event the money is not received and you have not contacted the collector, they will conduct follow up calls, as frequently as twice a day for up to a week. Telling a collector over the phone to stop calling is not effective. To stop all calls, you must put it in writing.

Abusive, illegal tactics by collection agencies can include the following:
Contacting you at work when you have already informed the collectors that it is not permissible
Contacting 3rd parties after contact has been made with you
Disclosing or threatening to disclose information to 3rd parties (friends, family, neighbors, co-workers, supervisors, etc…)
Threatening to have you arrested
Reporting or threatening to report false information on your credit report
Threatening any other action they cannot or do not intend to carry out
Name calling (examples include deadbeat, liar, and thief)
Using profanity
Attempting to collect a debt, or the portion thereof, that is currently in dispute
Contacting you over the telephone after you have sent a letter revoking their ability to do so
Calling in excess of what the law (your state law or the FDCPA98, whichever is more strict) permits
Contacting you in any manner after you have sent a thorough cease and desist letter—except to inform you of any action now in progress, i.e., a lawsuit

In the event of violations, you must preserve your rights. File a complaint with the FTC, the state agency that oversees collection agencies, and/or obtain a lawyer. If the agency is based out of state, you may be able to file a complaint in their state as well.

One of a debtor’s rights when dealing with a 3rd party collection agency is to demand that communications cease. The debtor can demand to be contacted by mail only, or not at all. Should the debtor send a complete CND letter, it is advisable only when the statute of limitations has run out for the debt. Otherwise, the letter will be interpreted (assuming that it doesn’t blatantly state so) as a refusal to pay the debt. The collection agency/creditor may very well file a lawsuit, viewing litigation as the only way to receive payment. A letter restricting communication to letter form only, in many collection agencies, move the debtor’s account from a collector to the compliance department (or whatever the dept is named, that attempts to ensure that the law is followed regarding debt collection) or experienced collectors will prepare a letter for the account.

It is my personal opinion that any and all correspondence sent to the collection agency be sent using certified mail. This is to provide the sender with a return receipt, which may prove very useful evidence in the event you take the collection agency to court.

Many people wish to not work with the collection agency, and instead work with the creditor. A debtor may attempt to work with the original creditor as long as they still own the account. If the debt has been sold, then it is no longer possible to work with the OC. Some entities by policy refuse to work with a debtor once the account has been assigned to a CA. This is not limited to consumer debts, and can include taxes, student loans, tuition, traffic tickets and other civil penalties. Most collection agencies that are collecting assigned debts do so on a contingency basis, and may only settle on the OC's terms.

It is important to know that collection agencies can do the following:

-Require the full payment immediately
-Not accept partial payments
-When attempting to locate the debtor, they may contact 3rd parties to obtain contact info (neighbors, friends, family members, etc…)
-Sue you for the debt (if past the statute of limitations, the defense is expiration of SOL)
-Ask you for your employer, banking info, income, etc…you are not required to give this information to them
-Attempt to collect a debt that has passed the SOL
-Use power phrases, such as “refusal to comply/cooperate”
-Explain any and all possible consequences of not paying off the debt*
Many collection agencies will perform some level of negotiating.
Simplified examples of negotiations may include the following:

-PIF demand --> settlement of 2/3
Or,
-PIF demand --> ½ down, ½ in 2 weeks or a month --> ½ down, 2 payments of 1/4
Or,
-PIF demand --> 2/3 down, partial payment plan over 3-12 months
Or,
-SIF offer, limited time only

The older the debt, the lower a company may be willing to settle for, but no matter which collection agency is attempting to collect, they will likely use boiler room tactics. In other words, the money must be in by 2 p.m., end of the day, end of the week, etc… Whenever a debtor is told that the money must be in by 2:00 p.m. (sometimes 3 p.m.), it is often because any payments received after that time will be applied to the next business day’s collections. Towards the end of the month, the collection attempts often get more aggressive. This is because most collectors/collection manager’s bonuses are based upon some form of monthly productivity, and they are striving to reach or maximize that bonus check.

The terms will soften only over time, provided the CA does not aggressively litigate. After each offer you are given is rebuffed, the collector will likely press you harder by explaining possible consequences (and in the case of abusive collections, will threaten you with things they cannot actually do).

On accounts that have passed the statute of limitations, collectors will attempt to have you verbally acknowledge the debt, especially if the call is being recorded, or having you make a token payment. Even a minuscule payment, or a promise to pay, will restart the clock. A cease and desist letter that does not acknowledge the debt, but does inform the CA that said debt has lapsed is probably the best defense.

Some collection agencies will refuse all payment plan offers, accepting only the BIF. These most aggressive companies will only take the PIF, or litigate the matter. Unfortunately, if they are legally entitled to collect the debt, they then do have the prerogative to proceed this way. Even though it isn’t “right,” it is legal. Before suing you, a debt collector must have either bought the debt, or been assigned to collect on the debt by the entity that does own it. In the event a debtor has asked for validation and is sued prior to being given said validation, then the debtor should answer with a counter claim for FDCPA8 violations.

It might be worth noting a couple of other things. First, many collectors are rarely paid a good wage. They may be paid a few dollars above minimum wage, but have the incentive of a potentially large bonus check after exceeding the amount they are budgeted to collect. The bonus can effectively double or better their standard wages. A second interesting fact is that a good number of collectors end up with the job after having been collected upon themselves, even with the same office if they live in the area.


*There is a difference between giving possible consequences and threatening.
For example: A collector may explain that failure to pay a traffic citation can result in the driver’s license being suspended (if that in fact can happen). A collector may not state that he/she is going to suspend the license unless the debtor pays.

BIF = Balance in Full
SIF = Settlement in Full
PIF = Paid in Full
CA = Collection Agency
OC = Original Creditor
fdcpa = Fair Debt Collection Practices Act
FTC = Federal Trade Commission


Your are not liable for your son's debts and you won't have to pay them. You can give them your son's phone number so that they can call him in order to recover their dues. If they still keep on contacting you, then you can send them a cease and desist letter and ask them to stop calling you any further.


Submitted by Anna Sweeting on Wed, 01/19/2011 - 01:58

Anna Sweeting

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Based on what I’ve read here, am I right to assume that these third-party collection agencies are only about money and not law or doing what is right? If so, how do I sign up to fight this?
This is what I don’t understand:
Why doesn’t a collection agency verify each and every debt before collecting? Why do we have to go through with the insults in the sense they are preying on our lack of law/intelligence to abuse us?
Why am I harassed each and every day if I have so-called rights (isn’t that the real question)?
How is it that a third-party debt collector doesn’t have to put anything in writing, i.e. payment arrangements?
How is it that some collection agencies get away with abusing the law over and over and over again before some political party/person who seeks advancement will step in?
In other words I am told I have rights, but only if I have money to hire to an attorney; thus, if I or you have money hello to American capitalism and welcome. If not, it is my right to be heard by a court; nevertheless, watch out because the lions will eat me.
Either there are laws or there are not. Either there is right or there is wrong. Thus, I think what is wrong here is we are not questioning the laws or loopholes that actually give some rights while screwing the rest, the debtor. We need to break down the laws and question them, possibly fight for change. And so I want to know how I can get involved.


Submitted by on Fri, 01/28/2011 - 16:46

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I had a collector sue me and garnish my wages. They took one payment and then I never heard from them again? I was thinking it was because they expected more, I wasn't making very much at the time. This was over a year ago. Should I be expecting to hear from them again?


Submitted by on Sat, 02/12/2011 - 11:39

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Betty Snow: It all depends on the age of the account. Generally, the older the account the more percentage you can get. I hope you had the CA validate the debt properly before you even started discussing negotiations.

LLB: Could be any number of reasons why they stopped. How did they get the judgment against you? Were you properly served but did not go to court so they got a default judgment?


Submitted by goldenbast on Sun, 02/13/2011 - 09:22

goldenbast

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If they only "took" one payment it is probably because your payroll dept stopped paying them after one payment due to change of personnel or payroll company. They can follow through with it legally. You were probably served where you no longer lived. That works unfortunately unless you go and prove improper service. But when you do that you need to give your current address.


Submitted by Frogpatch on Mon, 02/21/2011 - 17:38

Frogpatch

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I have a question:
Here is the situation: I left the country 4 years ago to work abroad after graduating. I am back to the US this year and I carefully went through my accounts online. I realized I still had one credit card with AT&T Universal and called them to make sure it was closed. When I called, they answered my account had been sold to Midland Credit Management. I called MCM, which told me my account was past due and closed and that I owed about $2400. They proposed to give me a 40% discount if I agreed to pay 1400$ in 3 times. I asked them for a letter stating my debt and they answered they only send letters, after you make the first payment. I am very surprised as I have never received any mails in the past 4 years from AT&T Universal claiming the debt or informing me of past due payments. Today, I have requested my credit score, and the MCM debt appears under "Negative Accounts" - "Closed Accounts" with the amount of 2400$. What should I do? Many thanks for your reply.


Submitted by yuna on Thu, 03/10/2011 - 18:48

yuna

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Since the debt has been sold you should send a debt validation letter, asking for documentation that proves you owe the amount them claim you owe and that they are the legal entity to be collecting. You will want a final statement to show the balance when the card closed, then you need to see a signed contract/agreement that states any interest/collection fees they may charge. Finally you want something that proves they bought this particular account.

Once you have these things you can set up a payment arrangement.


Submitted by goldenbast on Sun, 03/13/2011 - 13:13

goldenbast

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Have fun with the vampires 1 thats been calling me I have no clue what its about just gave her name then asks for personal info .told her to piss off & dont call again . Called my brother on his cell & a neighbor also . Have some fun 1-800-304-8855 ext 3655 Mary Lewis call & say howdy with over 200,000 members it would be nice payback. Also you 1st step is to deny or question the debt with the reporting agency its simple online .It puts the ball in their court they have to prove it within 30 days or it comes off your reort


Submitted by on Tue, 03/15/2011 - 18:38

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Yuna please post here as it is hard for me to follow specific threads within my message box.

MCM is full of malarkey! by LAW they have to send you a letter within 5 days of contacting you by phone.

NEVER EVER pay a voice on the phone.....you have the absolute right to know if the debt is legitimate.

Wait the 5 days and if you get no letter, send them a debt validation letter CMRR and also inform them they have violated once so far and you will be keeping track with the possibility of filing suit against them for violations of the FCRA/FDCPA and FACTA. Also attack the credit report listing as they HAVE to prove that what they are listing is accurate.


Submitted by goldenbast on Thu, 03/17/2011 - 14:53

goldenbast

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I received a call from IAG stating that my daughter has a debt of 1050.00 and if not paid today, it will be over 3,000.00 with lawyer fees, etc. I asked them a few questions and was told this was a 2007 debt to Credit One Visa. I am almost sure that debt was written off. If she paid IRS taxes on this debt that has been written off, does she still owe the 1,050.00? I ignored the threat of sending a Constible in our County with a letter. I told them I was good friends with him, send him on.


Submitted by on Tue, 04/12/2011 - 14:18

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If your daughter paid taxes on it, then it is considered forgiven debt because she paid on it as if it was income. Oh, it also was a violation for them to even tell you they were collecting debt from your daughter, that is third party disclosure and that is a big no-no.

Your daughter will need to dig through her past tax returns and find the information, in case they do try to sue.

If she does find it, she should send them a cease & desist letter, explaining that the debt was forgiven and taxes were already paid on it, therefor the debt no longer exists. She should also inform them that they have already violated her rights once with disclosing her private information with a third party and that if they continue to collect upon this debt that she will be forced to sue them.


Submitted by goldenbast on Fri, 04/15/2011 - 10:23

goldenbast

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Here is my situation. I owe about $7500 on Citi card. I lost my job in Jan 2010. My work visa ended with my job so I couldn't work anymore in US. I stopped paying credit card from Oct-Nov 2010 after all my savings exhausted dealing with house foreclosure etc. I left the country in Dec 2010. I will not come back to US for at least 1-2 years and after that it all depends if I will get a new job in US and get a new work visa etc.

Citibank had sent me settlement offers (40%) in March and I called them back in April to settle and I offered a little less than what they wanted (I offered Citibank 25% to settle off. Thats the best I can come up with help from friends). They said the paper work will be submitted for approval. I have kept following up with them about the status which did not change. Now since last 2 days I have been receiving miss calls from Unknown Name/Number and they are not leaving messages on my Google voice number (thats the phone I use). Today early morning I was on computer when I got the call and found they are calling from Client Services regarding my credit card amount. The connection was very bad, so I asked them to call me back.

I just called the Citibank to check whats my status of account and they said the account has been closed and sent to Client Services and now I have to handle it with them. I got Client Services phone no. from Citi. (1800-521 3236)

What should I do now ? Client Services will be calling again but I won't be on computer all the time to get their calls. Should I call them back and start the negotiations ?

I am thinking of calling them and ask for following in the order:

1. Begin by asking who they are and what they are calling about and I need the info in writing ?
2. Once I receive the info, I will send a letter asking for Validation letter ?
3. Then start the negotiations about settling the account.

Any advise is really appreciated.


Submitted by miamikk on Wed, 05/04/2011 - 16:17

miamikk

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I am behind on credit card payments for reasons beyond my control. I plan on settling all these debts as soon as a house I have for sale, is sold. In the meantime, I am being confronted by those shisters Richard Clark and pals and I need your advice how to proceed.
I received one phone call last week and when I asked why B of A gave my account to an attorney, the goofy girl put me on hold at which time I hung up. Then I receivced a notice today n the mail stating they had been "retained" to collect the debt that is owned by "CACH,LLC. They claim CACH purchased the debt rfom "original creditor named above, that being BOA. The letter goes on to say "unless you dispute the validity of the debt within 30 days, the debt will be assumed to be valid. If you notify us in writing within the 30 days that the debt is disputed, we will obtain verification of the debt or a copy of a judgement against you and a copy of such verification of judgement will be mailed to you by this office. Upon your written request within the 30 days we will provide you with the name and address of the original creditor, if ddifferent from the current creditor.

I'm not an attorney but I think the above is a bunch of who-ha and makes absolutely no sense. So I need to know, do I write these clowns and ask for proof of ownership? Do I call B of A and let them know I will settle with them when I get the money? Ignore all of them.

I tell you what my main concern is overall. I want to pay off these blood sucking bank accounts but if my credit is not restored I don't see the point in doing it. They can't sue me because I'm on SS disability and have no assets for them to take.

Thanks for your help.


Submitted by fun2decorate on Sat, 05/07/2011 - 21:23

fun2decorate

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You said "They can't sue me because I'm on SS disability and have no assets for them to take"

An attorney in your state sure can sue you.

If they feel you will have some money, a job, or assets in the future, they can go ahead with the judgement against you. Then they can only collect
if you get a job, car, or inherit some money or assets.


Submitted by Cancer Fight on Sat, 07/09/2011 - 15:35

Cancer Fight

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This guy named jack keeps calling my hubby's place of employment. He says he's from the Financial Law Division and threatened him with arrest, for a supposed bill. I know that they can't arrest you. But I'm not sure how to track these guys down to file a report. We've also been getting calls at home and at work from a guy with a deep Indian accent. He says you must retain attorney for record, do not ignore this call blah blah blah. I don't know how he got our phone number since it was private/unlisted. I called the Ohio attorney generals office, they said it was a scam. Luckily hubby's place of employment is being cool about it. But I don't know what to do about this Jack person. Has anyone else been getting calls like this? I told hubby invite him to come to the house next time maybe we'll have lunch. This guy is obviously impersonating someone. any info on this is greatly appreciated.


Submitted by Lisa M. Bobo on Sun, 07/24/2011 - 22:21

Lisa M. Bobo

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Also, I've asked quite a few times. Please have my name changed. Even sent a private message to a moderator. I'm not comfortable with these boards, showing my full name. Please change it. I've tried to delete the account and register again, but it tells me page doesn't exist. I'd like to have this fixed A.S.A.P....:)


Submitted by Lisa M. Bobo on Sun, 07/24/2011 - 22:23

Lisa M. Bobo

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Collection agency agents are trained to keep you off balance, they will interrupt you when they aren't getting the answers they want to hear.

The best advice is to always answer your phone when they call and tell them that you're working on a plan to pay them if you agree that you owe them.

This is mostly a stall tactic that you can use.

To make them stop calling all you have to do is send them a 'cease and desist letter' US Postage signature request. This works 99.9% of the time because you've documented the request. Also for extra protection send a copy of it to your state attorney general and make sure to CC it under your signature on the letter to the collection agency.

For my clients we've had actions dismissed or passed off to another collection agency because they know you mean business when you deal with them this way.

Good Luck!:)


Submitted by sawilliams on Tue, 08/02/2011 - 21:43

sawilliams

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You may be correct in this, however when they are allowed to cut someone off while on the telephone and threaten lawsuits while you are trying to get something set up under 24 hours of them sending the first notice is also allowed. The federal government had made it where debt collectors can force families out of their homes because they are not willing to allow the debtor to talk. The collector has very little control of the conversation when there is a wonderful thing called hanging up.


Submitted by JohnDoe101 on Fri, 08/26/2011 - 10:01

JohnDoe101

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This piece of information came straight from the DJ Spencer, supervisor for Innovative debt collections. She actuallt informed me that it is allowed by Federal law.


Submitted by JohnDoe101 on Fri, 08/26/2011 - 10:17

JohnDoe101

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So you are telling me that it is completely legal for a company to do this right? And they are based here in Arizona. I can tell by the way you are talking down to me that you believe that collectors are all legit and are allowed to treat anyone like trash because they are just simple minded people who like to power trip. I bet if I told you that you will have the full payment in the mail, you would believe me right? The federal government is so messed up right now that banks are failing as a result of closed minded people unwilling to bend to help their fellow man. Let me guess, you are the type that would have a lot of private debts unpaid but still talk down to people because you believe you are in a position of power. I am not some naive person that you can belittle with your internet courage, I served and fought in the US Army so you could have the freedom to treat people like trash, do NOT insult a person or talk down to them unless you know who you are talking to or are able to talk that way in person.


Submitted by JohnDoe101 on Fri, 08/26/2011 - 10:36

JohnDoe101

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WOW....I am banging my head....did you read what I wrote???? You stated

Quote:

The federal government had made it where debt collectors can force families out of their homes because they are not willing to allow the debtor to talk.


I responded that this is BS....a total fabrication by a debt collector that you are believing...debt collectors do NOT have this power. Maybe go back and read my responses.....


Submitted by SOAPLADY on Fri, 08/26/2011 - 10:46

SOAPLADY

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Wow something civil, maybe had you used that wording instead of trashing me it would have been a decent conversation.


"Oh please ....where did you come up with this choice piece of BS??
Show me federal law....oh wait....you can't...... "


Submitted by JohnDoe101 on Fri, 08/26/2011 - 10:55

JohnDoe101

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This is what a wrote...
Quote:

Oh please ....where did you come up with this choice piece of BS??


Sorry, you show up out of nowhere spouting off totally wrong information with no research or citation to back up your "facts". Maybe if you had asked whether what the debt collector had told was true....


Submitted by SOAPLADY on Fri, 08/26/2011 - 11:01

SOAPLADY

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So you don't hear the cinisism in the wording? Having dealt with collection personel in the past, I know most of the rules and laws. However with banks failing, the federal government has been allowing this kind of trash for years. I had no clue that there was such dishonesty in this organization....See if you had tried to use civil wording instead of the way you did, then the topic would not have escalated to this point. Correct with civility instead of snide remarks, and then you end up coming out with helping someone with the correct information right off. Just some advice for the future corrections you wish to make. Just a suggestion.


Submitted by JohnDoe101 on Fri, 08/26/2011 - 11:10

JohnDoe101

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If you have experience with debt collectors, then you should know and should have read the FDCPA. Debt collection laws have nothing to do with banks failing and the federal government has not been allowing this trash to happen for years....the feds provides for protection to consumers. My cynicism comes about when people like yourself start posting as experts when they dont have their facts straight.


Submitted by SOAPLADY on Fri, 08/26/2011 - 11:42

SOAPLADY

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I have my facts straight, but wished to see how another collector would react. Now explain to me how these laws that are supposedly in place to protect the consumer, why do 99% of the collectors resort to threatening and dishonest acts to collect a debt? Why do collectors call every fifteen minutes harrassing people and doing everything that the law is there to supposedly prevent them from doing? There are very few honest collectors that actually follow the rules to the tee. I can guarantee now that the best tool for any consumer to have on hand, when being harrassed by any and all collectors is the fdcpa. Since these arrogant collectors like to break the consumer's civil rights. People make mistakes or have a hard run of hardships, and then there are the ones that try to take advantage of the system. Now, the real problem is that collectors lump the people that hit real hardships in with the one's that try to take advantage. Either way, the dishonest people in your field combined with the dishonest people that have tons of debts have destroyed whatever reputation collectors had.


Submitted by JohnDoe101 on Fri, 08/26/2011 - 12:18

JohnDoe101

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Quote:

I have my facts straight, but wished to see how another collector would react. Now explain to me how these laws that are supposedly in place to protect the consumer, why do 99% of the collectors resort to threatening and dishonest acts to collect a debt?
Obviously you don't have your facts straight or you wouldnt be making up statistics you cannot support. There a many, many ethical collectors....however nobody seeks out forums to praise them.

Quote:
Why do collectors call every fifteen minutes harrassing people and doing everything that the law is there to supposedly prevent them from doing? There are very few honest collectors that actually follow the rules to the tee.
if you didnt call screen, there would be no reason for the dialer to call you back. Hardly harassment....
Quote:
I can guarantee now that the best tool for any consumer to have on hand, when being harrassed by any and all collectors is the fdcpa. Since these arrogant collectors like to break the consumer's civil rights. People make mistakes or have a hard run of hardships, and then there are the ones that try to take advantage of the system. Now, the real problem is that collectors lump the people that hit real hardships in with the one's that try to take advantage. Either way, the dishonest people in your field combined with the dishonest people that have tons of debts have destroyed whatever reputation collectors had.
Collectors jobs are to collect debts for their clients..sweet and simple. Many collectors do it very legally everyday. They follow their clients directives. The debtors hardship really isn't their problem. And it is NOT my field....havent worked in collections since 1999.


Submitted by SOAPLADY on Fri, 08/26/2011 - 12:36

SOAPLADY

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I can't believe how biased you are. You can't even see what I am saying, just that it bad mouths collectors. You do not know every single person working in the field so you can not speak for them. Most are arrogant jerks that refuse to hear more then yes sir what ever you say sir. I admit there is a few that are decent that do more then lecture, like you are doing. I had one actually tell me to file for bankruptcy on a new debt that is less then a month old. No contact by mail just threatening phone calls, how's that for being correct? It isn't, and you know it.


Submitted by JohnDoe101 on Fri, 08/26/2011 - 13:02

JohnDoe101

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Has anyone heard of Thomas and Associates PC in Houston Tx. I have done reverse phone number on the ones I have and also on an email, no results!!


Submitted by on Mon, 01/21/2013 - 15:40

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