What would it feel like to have your wages garnished for a debt that you didn’t even owe? This unfortunate scenario happened two times to a New Mexico woman who had no connection to the Target Bank account or to the collectors employed by Target. With an explosion of growth in the debt buying industry since the 1980’s, cases like these are becoming increasingly prevalent. Now the combination of technology and large debt buyer firms has created a profitable industry that also holds the record for highest industry complaints logged with the Federal Trade Commission. Consumers have very real options when faced with unscrupulous debt collectors, they can fight back by taking advantage of the statutes enacted in the Fair Debt Collection Practices Act.

Some debt collectors phoned Lucinda Yazzie, subjecting her to the unpleasant experience of hearing them claim that her Target card was carrying a late balance. She informed the collectors that she did not owe the debt and that there was another person in the area with the same name as her. Collectors received a garnishment order regardless of her efforts to inform the debt collection agency multiple times. Her employer insisted this was not the same employee and the garnishment was dropped. Yazzie was faced with further legal action by the same debt collector only two years later and her wages were garnished again. Until filing a lawsuit of her own for FDCPA violations, the former standing order was still considered in affect.

She received a settlement from a lawsuit in the amount of $1,260,000. In this particular instance the compensation is definitely worth considering. Lucina Yazzie took action to hold collectors accountable; but most Americans won’t defend themselves against an industry that’s very well funded and composed of very motivated agents who are always being pushed to the maximum on very noisy boiler room floors.

Owing its’ origins to the Savings and Loan Crisis of the 1980’s, the debt buying industry and third party debt collection has come a long way. After dealing with Savings and Loan assets the debt buying and collection industry known by insiders as the “Adjustable Receivables Management” industry, branched out into credit card and other consumer debts.

Until the recession in 2008 debt buyers and collectors grew slowly but steadily, and then analysts predicted an increase in the business. These estimations end up being true because in 2007 there were approximately 100,000 complaints. That figure jumped to 130,000 in 2009. Several factors influencing the rise in complaints include aggressive tactics that ignore legal boundaries, technology to increase calls to consumers and the increasing use of local courts to sue for delinquent credit card debts.

Creditors are required to hire collection agencies with a qualified attorney in the same state as the one who owes the debt, however the empty threat of “legal action” is a favorite among bill collectors. This is often an FDCPA violation if the collector does not have the immediate capability and intention to sue on the debt.

Research has shown that respondents who appear before the court for their creditor lawsuits are much more likely to have their cases dropped than those who did not. The study also states that the most important thing a consumer can do if sued by a creditor is to respond through the court system within the time allowed even if the debt is not theirs.

The courts are rejecting the legal actions of a lot of creditors, which shows that they are often unable to follow through with their threats. But this is a business that has a 58% increase of profits in the year 2010. Sometimes it helps to not follow all the laws and be aggressive.

Because of the high volume of complaints the Federal Trade Commission urges consumers to use the protection provisions in the Fair Debt Collection Practices Act to defend themselves against non-compliant debt collectors. In much a similar scenario to the intensely partisan legislative scene that exists today, the FDCPA barely passed after a tenuous debate, and was enacted in 1977. However Congress ultimately realized that there was a need to protect people from all parts of society against abusive debt collection practices that were also rampant in the Seventies. The need still exists today.

In an Article on money by CNN the proprietor of a debt collection agency notes that “Debt doesn’t go away as fast as it used to”. Debt is now a fact of life and a burden to manage for many Americans. Fortunately there are Certified Debt Specialists who have experience talking to hundreds of bill collectors. These people are professionals and are aware of the ins and outs of the system. More and more consumers are realizing the need for a specialist with technology that is certified to help negotiate with big debt collection companies that are continually growing.

Debt Settlement

Debt Settlement / Web Development Orlando

Any business owner or manager who trades in money rather than barter will eventually need to know how to collect debt. Rather than relying on outdated techniques, consider the most updated thoughts on how to collect debt and you’ll get more money quicker.

The first step in collecting debt is to start with gentle reminder letters and phone calls. If you’re talking to a good client from whom to hope to get business in the future, a simple “I believe you may have overlooked this invoice” is a good start. If the debt has been outstanding for a while, you may need to step up your language a bit. “Upon receipt of this letter, please remit payment immediately or further action will be taken.”

One thing people may not consider when thinking about how to collect debt is hiring a private investigator. If you are having trouble getting your client on the phone or getting bills returned to you, a professional investigation service will be able to locate them as long as they’re still in the country. Sometimes finding out that they can’t hide from you is enough to get them to pay. If you are considering hiring a professional collection consultant, one who has access to private investigation services is your best choice.

When you’ve found the best phone number and address for the difficult debtor, the next thing you should do is to tell them that you’re reporting them to credit bureaus. Of course, you have to be willing to actually do this, but there are benefits to both the threat and the action. People who care about maintaining good credit scores may pay when they hear the threat, but reporting to the credit bureaus will help you down the line as well. The homeowner who wants to get a HELOC, for example, may contact you and try to make good on their debt in exchange for you responding to the credit bureau that the debt was satisfied.

This may occur quickly or it may take years, but you should make a report to credit bureaus when you’re certain the debt is a bad one. This is one of the most crucial leverage steps for the creditor when considering how to collect debt.

Another possibility is offering the debtor a settlement. This can be done on your own or through an arbitrator. If, for example, someone owes $5,000 on your store credit card, but the original debt was $3,000 and the rest is late fees and raised interest rates from after they stopped paying, it may be a win-win situation for both of you to offer to take $3,000 and drop all further claims.

Another win-win situation for debt collection is to come up with a payment plan. You can tell the debtor that he or she can miss a couple of payments, switch to payments that only take care of the interest, or change the terms of the loan from say, ten years to fifteen to lower the payments. This will give the client a break in the short term but it will also make you money in interest in the long term.

The final thing you need to know when you’re considering how to collect debt is the law of diminishing returns. The amount of money you will recover on the dollar drops at 90 days, 180 days and one year. Concentrate your best efforts during the window of opportunity and you’ll get more money back. Professional collection agencies with expertise in the area of how to collect debt advise that immediately after 60 days is the best time to get your money back.

Drew Matthews has been a greatly respected industry authority, organization expert in addition to publisher about collection agencies professional services for 30 years. He provides you with more practical advice and important information concerning business debt collection.

This morning American Express phoned me to collect my past due payment. The amount of money that was past due that American Express woke me up to collect was inconsequential. A whopping $200 was what it cost to have a morning service call from a behemoth credit card company. Why do credit card companies feel that it is necessary to collect money that is past due the following day? I thought that there was some sort of policy or waiting period in order to collect past due funds? As for the call in the morning, why am I being called so early in the morning anyway!

I understand if a company needs to get the past due funds from me. Iempathize that their job is to collect what is owed to them. What I don’t get is why I am being called at 8 am in order to collect that past due amount. If there is any occasion to call and collect money that is past due is the afternoon. At least at that time the caller isn’t waking up anyone or interrupting someone’s breakfast. The morning is a tough time of the day. The morning is the time of day to collect your thoughts and then perform the necessary ritual to begin your day. Past due credit card bills do not fit in the beginning of the day.

There is a particular schedule I have when getting myself ready in the morning. I wake up at a certain time and get showered, dressed ad ready to kick some ass. This morning I had a tough time waking up due to the previous night’s late night. I was not expecting a call this morning about the past due amount on my Amex and neither was I wanting to deal with their need to collect money from me. I pay my bills on time and square away my debts. I do not need some credit card phone representative disturbing me to collect money that is past due, especially not at 8 am.

The afternoon or even early evening is the prime time to get a hold of me. I am available to speak to. I am wide awake and alert. I do not think that a sensible answer was going to be received from me regarding my past due amount early in the morning. I don’t think it is very fair to be telephoned and hassled by a credit card company either way. If you want to collect money from me, call me in the afternoon or don’t call me period. If you call me too late that is even worse. If I just get to sleep and you are calling to collect money from a past due discrepancy, I am going to hang up on you. I don’t have to talk to you. The internet exists for automatic payments and emails. Take my money when I plan for it and email me if there is a problem when you try to collect my past due amount.

I despise credit card companies to be honest with you. I feel that they take advantage of their customers and annoy them any chance they can get when it comes to collect money. Past due used to mean that if I owed you money, I could get it to you whenever I had it. There is too much stress when trying to collect money. There is always going to be someone reaching their hand out to snatch money from you. Whether you pay on time or your bill is past due these damn vultures will do whatever it takes to collect. I hope that one day the world realizes that credit cards are a vice and stop using them but how else am I going to buy that fancy gadget or movie title when I have no cash right now?

Searching for experienced collection lawyers? Contact Rapid Recovery Solution today for more information on commercial debt collection!