I work for a public agency that has an in house collections, and yes, I am a collector. Fortunately, I work with items that are actually owed like parking tickets and returned checks, but one thing that we don't do is report to CRA. This is a waste of time and based upon the volume of inventoryand to be frank about it, we don't have the resources to substantiate each item. At this point we don't even report these checks to the local DA or to any reporting system. We also don't assign or sell our AR to collection agencies because we have been burned by this. Some of these guys are so unethical that they will even steal from the agencies who assigned the debt. I look at our inventory as just that, inventory. It is what keeps me employed and if the inventory ceases, I am out of a job. I have had instances of people writing 14-29 bad checks, and yes it is annoying, but when looking at this from the perspective of a business, each check is assessed at treble damages which is between $100-1500K when granted a judgment. I also realize that people sometimes are going through things when they rack up debt. I have had horror stories of cancer, spousal abuse, and losing a job and living in a shelter. These are realistic situations that make paying a bill secondary. The only thing I can do as a collector is to try to get a payment, or even letting this stuff sit on the backburner to wait for the statute to run out and write if off. I gained a perspective when working for the IRS, sh_t happens and in the long run, what is a couple of thousand bucks. By accident we collected millions of dollars from people whose tax debts were over $100k. People who owed little amounts such as 1k-10k were considered small fry and when we exhausted minimum effort, placed in currently not collectible status. I read over Collectman's posts and was amazed at how personal this collection thing is for him. Here are some realities for collection accounts: Most of the time, a business will write it off after 120 days. It takes more money to collect on an item than the actual face value of the item. When these items go to court and the defendent shows up, the judge will ask if a settlement can be reached without a judgment. (it normally happens) "So you get a judgment from a person who has nothing to levy (garnish) then what?" is what a judge stated to me in court. I took this back to our management group and this became a changing point in our approach to collections. Sh_t happens once again and if a person can't pay, you can't serve them, and you have 10k other accounts, what do you do? You let that stuff sit in a drawer and wait until the statute runs out for court and write it off. Consumers are becoming more savvy and you must respect that they are knowledgeable about the process. Therefore to mitigate damages, we don't report to CRA beyond getting a judgment, which becomes a matter of public record. Also, as a consumer myself, I find that CRA will screw me over or that an utility bill from my ex-hubby will show up on my report and cause me major points on my CR. Therefore, as both a collector and as a consumer, I see both sides and bring a level of understanding when dealing with my debtors and yes, I do two letters and one call before the next step is determined. That is what happens when you have over 6k accounts that are within statute.
I'm glad to see another collector on the board. I look forward to insights you may have on some of these topics. Welcome!
Thank you, Collector2 for being so understanding. Just a question ot two - how would you have to react if your bosses instructed you to go after everyone, if there is a budget crisis in that public agency, less funds from county or state govts?
well it goes like this In order to understand the nature of how the debt is incurred, as a public agency there is several issues at hand. The local economy, the status of the accounts, and the viability of the account. Collection for us is based on whether we can attain a judgment or not. The telling method is on whether the judgment is enforceable. We have judgments sitting in our cabinet that are not enforceable. In fact, these judgments have been sitting there for about 10-16 years. When items are sent to us, they are already considered uncollectible. If we collect, good, if we don't we already knew we wouldn't. What a pub agency does is tighten the belts, layoffs, cut spending, make up new fees, stuff like that. I know, I know, it is a shame in some cases. Collections is a costly game. Just to pay for the resources used for skip tracing is a substantial amount. Therefore, the collection on viable accounts is the approach. This is even true for the Feds. It does the feds no good to go after the little ole lady from pasadena. When you can get a hefty payout for back taxes from Intel Corp or a major corp who incorrectly off shored. Business collections is more viable and more profitable. You, or even me would be a crap shoot.
Welcome, and excellent post. You bring a tremendous persepctive to this forum. I am certain your input will be valuable, I hope we can return that.
It may sound that I take things personal but I don't. There has only been a couple handfuls that I have taken personally. And those were accounts that I personally own, it's my money. I paid for them out of my checking account, not some investors. Why wouldn't I do anything and everything I can legally do to collect that money? I agree it's all just a costly game. The accounts I work for my full time job, I don't get too personal over. If they are a sizable account that are just making excuse after stupid excuse, and getting caught, then I do whatever I'm allowed to do to get the money. Sure if the balance is small, or they don't have at least any property to attach, stick it somewhere, sell it to another agency to deal with. But if they have any property, possible bank account, and they aren't paying me, I'm suing them. Sure it's going to be about 6 months before I get the legal collections, but it's better than getting nothing, even if it's only $500-1000, that end of the month addition could put you into bonus or higher bonus level. I see both sides as well, I just choose to see the one that will make me money. I have a heart, I'm sure at one point I've been through some of what they are telling me, but it's not my job to sympathize with them, I can only empathize collect the debt and move on.
I think the point here is that you previously stated that you would never consider a pay-for-delete scenario. That is contradictory to any valid business model which is profit oriented and it is not doing "anything and everything" you can legally do to collect. It is counter-productive to both sides of the potential equation. Personally, it is your perogative as misplaced as that may be. Nonetheless, I'm certain that is the cause for the posture of this board.
I agree with apex. If it wasn't personal, you wouldn't care about reporting. If money was the bottom line, you would *truly* do what you needed to do, even if that means being a semi-decent human being and removing the tradeline. To me, you sound bitter. Maybe too many consumers have broken your heart. I'm here for you, collectman.
Wow... the word "collector" altogether brings just a weird feeling. Reading this post though gives a lot of perspective.
HA! Unfortunately, there are no consumers on my end, they are debtors. Reporting the tradeline isn't personal at all. It's something that should be done if the debtor refuses to pay for any reason. I'm not bitter at all to most of the accounts, only a couple stubborn ones that I've dealt with, and won in court.
Such as the debt not being truly theirs? Or the debt being for a product that was missold or did not live up to basic expectations for similar products - i.e. obvious lemons? Or a utility bill that is pre-paid monthly that the utility never forwards the final bill to the new address (in other words, the debtor had no way of knowing they were in debt)? These represent all of my CO's and collection accounts. Your view of these scenarios as being rightfully reported to CRA's is why you are taking such flak on the board for the last week or so, and why most people think collectors are heartless scumbags. No offense to you, from what I've read of your posts, you seem like an OK person, but the flat out refusal to do a PFD under any circumstances, especially considering it sounds like you get very few requests for them, just boggles my mind.
Ok let me rephrase it, reporting a debt that is valid. Happy? Of course they think collectors are heartless scumbags, they called demanding money (for a valid debt) and they don't want to pay it. Now the collector argues with them or tells them they are going to sure them or whatever the case is. I can't help what people already think about this profession. I've never had any complaint against me, never had a BBB complaint, never had an AG complaint. I do whatever it is that I need to do to collect the money, legally on a valid account . I just don't see a reason to accept the PFD. The debtor has waited years before sending it to pay it off. What they want a new TV, car? Why should I reward them 3-5 years later or more by removing the tradeline. Why wouldn't I just sue them get a judgment. Sure I have to pay for court costs, but it's added right back onto the judgment, so after it's all collect, I've gotten everything I want. And now they have a paid judgment instead of a paid collection. (for a suit-worthy account thats valid of course ) If the account isn't suit worthy for whatever reason, I'll just bite the loss, like I said there are plenty of accounts out there to make up for it.
Analysis of determining of how much it costs to collect Well, fortunately, I don't work on a bonus schedule. I am paid hourly whether a person pays or not. Fortunately, I am a college graduate and a business graduate to boot. I did a cost analysis of what it costs our dept to collect on a debt. This included sending the first notice, using the skip tracing tools, sending the final notice, responding to validation and then the whole plaintiff claim. The final outcome was with salaries and time, it cost us over $300 to begin the process of collection on a debt. Therefore, items that were under this amount was and is considered a waste of time. We also analyzed the reporting process to CRA. With the wide amount of debtors disputing and us required to answer the dispute, the cost reached to over $500 per item. Therefore we work with the concept of sending the notice, making one courtesy call, sending a final notice, and then we file suit. It appears that private collections is into the game of harassing a person. Once I make contact and a person states that the item was paid or it wasn't their item, I make it a point to resolve the issue.before I am required to take drastic measures. I make $25/hr no matter what. Most of the debt that is our inventory was already written off. This is true even for the IRS. If you can collect it, good, if you don't, oh well. In fact, in 1997, stopped all call centers from counting dollars collected. We moved to a philosophy of cause, cure, and compliance. I think that PFD is a wonderful mechanism to get rid of the liability. Until the item is collected, is is considered an outstanding A/R for the ca. This skews the books and ultimately skews the financial statements for the company. If PFD are "against" the cra contract, as a private collector, upon receipt of full pay, I would not respond to the CRA dispute. It serves me no purpose to respond when I have what I originally wanted "the money" If the person keeps incurring debt and coming back to my inventory, well this is called gravy. IN OTHER WORDS JOB SECURITY.
That's dangerous too. The trend now is to take every collection case to federal court for FDCPA violations. It isn't just the debt collector that is getting taken to federal courts it is also the attorneys who file the suits. Some cases I know of are situations where the debt is out of stat and the attorney files suit. He not only loses the case because it is out of stat but he gets sued in federal court for misrepresenting the legal status of the debt. In the process the original creditor and the debt collector get sued as co-defendants. The original creditor answers saying they sold the debt long ago and no longer has any right, title or interest in the case so can't be sued. That lets them off the hook but in most instances they have been named as the plaintiff in the case and that generates even more charges against the debt collector and their attorney. It was the attorney who made the mistakes and should have known better than to file the suit in the first place but the debt collector is also responsible for the actions of the attorney. Once the federal case is settled, over and done with then comes disciplinary action from the state bar association and the lawyer can lose his license to practice law. He might get away without losing his license on only one complaint but if it happens a second or a third time he is definitely out of business. Since there is almost never any attempt at debt collection that doesn't violate the law somehow every such attempt should be taken to federal court without fail. If everybody who is contacted by a collection agency took them to federal court one of two things would happen. Either debt collectors would quit doing illegal things or they would be out of business.
The posturing aside, the facts are simple - even if Collectman and Collector2 do everything they say the do, they are a small minority in the collection industry. It costs money to sue and while they may try to make it sound like they automatically sue everyone and the Judge is is their Brother in Law sitting at the next desk, the facts are it just isn't so. This is merely the reality they wish consumers have - not the reality that exists. If it were real, then why do the collectors at InsideARM, which represents a much wider and diverse cross section of collectors, continually complain about all the VOD demands, the restrictions of FDCPA and the increasing willingness of consumers to sue for even small violations, an act they termed "being AoC'd" after the late, great board, Art of Credit. If they did in fact sue as often as they claim they do, the courts would have ground to a halt years ago. No, my friends, this thread is just more posturing.
every?! case to Federal court? That seems like a bit of an overstatement. Granted it seems to be happening more often and for less egregious cases, but I suspect it's still far from "every" case. On the one hand, it's a good thing that CAs are being held more accountable for their illegal collection activities. On the other, it seems unfair that the the untrained, usually uneducated (with regards to the FDCPA, not their particular knowledge in general), consumer is left to enforce the FDCPA. But, at least the law is on their side which is a step in the right direction.
The trend towards Federal Courts may well be because the state courts have little knowledge of the FDCPA and little interest in enforcing its provisions. A consumer should have a the right to due process and consistent justice. Wouldn't you in his shoes? Federal Court seems a good place to be if due process can't be found at the state level. Frivolous suits? They get filed every day, by the thousands by the legal profession. It might be interesting to do a statistical analysis on the suits by CAs and JDBs where the defendant answers the complaint. How many are dismissed because the plaintiff doesn't have the evidence to prove his allegation? An overwhelming majority would be my guess because they really can't establish their case. Don't those qualify as a frivolous suits? They do in my book.
