Debt Collectors in Different Situations Part 1

Calls and Letters from Employee Debt Collectors of the Original Creditor, the Credit Card Bank

Debt Collectors employed by original creditors are not covered by the FDCPA. Flyingifr, the founder of debtorboards.com and a former employee of a credit card company’s collection department, gives an in depth explanation of credit card banks collection departments. Briefly what he says is these collection efforts go from friendly to threatening as the debt ages toward a six month charge off.

These collectors are paid salary not commission, but they are evaluated on how many debts they prevent from aging. Large balances receive more attention than smaller ones. Notes on why you cannot pay and your personal details are made in your computer file at each interaction with you, so ideally other collectors can have some personal knowledge of you. Court action is threatened as your debt ages to the limit and plunges you into the debtor hell they claim will confront you after it charges off. As a more desirable option, in their minds, settlement or payment plans are offered near the six month charge off. Your options are to settle or wait for charge off.

Collection Efforts by a Collection Agency after a Debt Charges off But before It Is Sold to a Junk Debt Buyer

The FDCPA covers these activities and protects you. Here commissioned collection agents try to scare you into paying. They are working for the credit card bank on a percentage (25 to 35 percent) of collections. They play the numbers game looking for the easy targets. They must send you a mini-Miranda notice within five days of their first call to you or before that.

If you respond within 30 days of its receipt with a deny/dispute debt validation request, they will move on to find an easier debtor to collect from.

You can also settle with them, if you have the money. Some feel this is the best time to settle to get the largest reduction from the original creditor.

Learn how to protect yourself against debt collectors. Get started with my free Seven Dangers of Not Knowing How to Deal with a Debt Collector.