The Wonderful World of the Debt Collection Agencies that were..

Most of us are aware of how debt collection agencies operate. If not, here's a quick overview:

How They Get Your Account

Collection agencies can be found in two different forms: in-house collection and third-party collection. The in-house collection agencies are most often the billing department for a credit agent or large firm which offered time payments. These are used to collect money while keeping the collection costs low and within the company. Most often this will be the first collection attempt you will come across.

Third-party, or outside, agencies are those which are hired by a firm to collect a past due amount. These are the most common types of collection agents people come into contact with. These companies either work on percentage or purchase charged-off debt from the original creditor.

How Collection Agencies Make Money

Many collection agencies and their agents work off a percentage of what debts or payments they can collect. Others purchase your debt for pennies on the dollar and then attempt to collect the full amount. Usually if a debtor pays off what they owe, the collection agency makes money from either the payments or from the difference between the costs of buying the debt and the amount collected. In most cases, the collection agency makes from one-quarter to one-half of the full amount as profit. If the collection agency cannot collect the debt, they will often sell the debt to another agency to break even and look for more successful accounts; this usually creates the involvement of three or more agencies with one account while the original creditor has written off the account as a loss.

Wonderful isn't it? I wanted to find the owner of this company that has sent me the letter with the intent to collect, because I was wanting to send him or her a Courtesy Notice as well. Upon finding his name, I did a little more digging and found this man has companies all over the nation who's sole function is to double-dip on alleged "debt". It's a soulless racket which used to ruin people financially. For example, the original loan is "charged off", THEN sold to these agencies for collection resulting in TWO OR MORE negative entries on the credit reports we used to have heart attacks over. I'm so glad the shift has taken place, more to come shortly...

Is there a reason you don't identify the crooked corporation? Let me add that one CAN PAY OFF A DEBT- EITHER TO THE ORIGINAL PARTY OR A DEBT COLLECTOR BUT AROUND YEAR 5-7 RECEIVE A COLLECTION LETTER! It then becomes your burden of proof. They do this deliberately because after 7 years they cannot collect if they fail to notify you and most people don't keep records. I know- I have a 20 year old medical bill that was settled immediately. I got a collection letter 2 years later from the hospital. Fortunately, my Health carrier was the responsible party and took care of the bill by proving the hospital had in fact cashed the check. Done? Nope! Nearly 6 1/2 yrs later; I received a collection letter from a 3rd party for the same debt! Fortunately, I saved the information and scanned and faxed it. Done? NOPE! Near 6 1/2 years later I received yet another debt collection letter from a different 3rd party carrier. Mailed the info again and it was done? NOPE! Just 2 weeks ago I am going for round 3! This time it's a courtesy notice and I am thinking of mailing one to the 3 credit bureaus. I don't know, give me a break. How can one keep up when 3rd party credit collectors keep selling off batches of uncollected debt- that is "uncollected according to their system records". Think about 1000's of even just $100 erroneous debts cycling through 3rd party debt collectors and if they are owned by one MAN

Thank you for your input ShieenaLivingWater,

I wasn't implying that one man rules them all, I was just giving a refresher course about how fraudulent the very cycle you mentioned is. I was just in awe over what some will do for money at the expense of their fellow man or woman. Seems we both have some mailings to send..