How Debt Collectors Work and What You Need to Know About Debt Collection

How Debt Collectors Work and What You Need to Know About Debt Collection

You fall behind on your debts. You’ve always paid your debts, so you’re worried. Finally, the calls start coming. Anxiety knaws at your intestines and your shoulders tense when the caller identifies himself or herself as the embodiment of your fears, and pulls at the strings of shame that have been left on the fringes of your tattered finances. “We have a past due account here that needs payment right now, and we need you to take action” says the collector, or something similar. “You know you owe this money, right?” he or she might add.

It feels very personal, even though the caller is an employee or representative of Citibank, Bank of America or some other large financial institution. You’ve had those shiny little cards that even sport dazzling holographic emblems on them that change with the angles to the light. They’ve been free passes that allow you to buy anything on the spot regardless of your bank balance. As the Visa slogan goes ““It’s everywhere you want to be.” You don’t want that ride to end, and you really believed it was part of your standing in society to have these shiny passes.

In reality, the debt collector on the other end of the line is being paid $10-12 hour to call you if they are calling from the U.S. or Canada. Or that much a week if they are calling from Mumbai or Manila and disguising their accents from a top-of-the-line call center in India or the Philippines. If they are lucky they have their own cubicle. They are attached to a headset and a computer that automatically dials your number contained in a database. They may or may not be incentivized with small bonuses on their collection results, although in the case of the foreign call center jobs, those are so coveted there that they do not need to pay bonuses.

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Below is a video selling debt collection software to collect on delinquent debts. It is admittedly boring in its 6 minutes and 14 second duration, but even watch 3 minutes of it and you’ll get the picture of what it is like on the other side of the equation from where you sit. It is a numbers game being played quite coldly and impersonally with each call imbued with whatever drama you and the caller can muster, but I assure you, most of the drama is on your side with the guilt, not their side which is nothing more for them than a grind, a way to make their daily bread.

Think about whether you’d like to have their job. They are just adjuncts to the databases and computers putting a human voice to what essentially is connected to the corporate ledgers. It is not a role most of us would prefer. No little girl or boy grows up saying, “I want to be a debt collector someday.” If they had an independent source of living it is doubtful anyone would want to sit eight hours a day in front of a cubicle collecting debt. They are for their work lives the human equivalent of animals in CAFOs (Caged Animal Farm Operations). Yet paying their corporate overseers only makes more of them, not less.

Now, I don’t want to come across as some left wing socialist railing against the social order. Yes, if you have the ability to pay, then the corporations should get you to pay. Yet, if you are insolvent and unable to pay, the sooner you figure that out the less costly it will be for you. Nor should you take these call personally. They are not personal. They are business.

At LeverLaw, once we’ve diagnosed insolvency and have taken you on as a client, we start taking creditor calls right away and they have to stop calling you under the FDCPA or Federal Fair Debt Collection Practices Act. This is even before you file bankruptcy, as the automatic stay of bankruptcy is not necessary to stop the calls, and violations sof the FDCPA can be enforced through lawsuits.

Merely reacting to the squeaky wheels of debt collection without stepping back and realizing what is happening, either in the debt collection process to which I’ve given you a window to in this post and video, or your own financial situation is confusing, bewildering and ultimately wasteful. Deal with your creditors in good faith if you can, but when you cannot pay them without doing damage to your own family and finances, you need to get professional help, fast. Debt collection is a sign of insolvencyyou should not ignore.