MSN Article on "Zombie Debt Collectors"
Here's a great article for consumers on zombie debt collectors. Here we call them "Bottom Feeders". What are Zombie/Bottom Feeder debt collectors? These are debt collectors that buy accounts that others have failed to collect, and sometimes debt that can't be sued upon based on the statute of limitations. MSN says this is a multi-billion dollar industry that is growing by 30% per year. Here's what MSN says these collectors pay for these accounts:
The amount that companies pay for bad debt depends on the type of account and its age. In general, McVity said:
Debts that have recently been charged off: 6 to 7 cents on the dollar.
Accounts that are slightly older and on which a collection agency or two has already taken a whack: 1.5 cents to 2 cents on the dollar.
Years-old, out-of-statute debts: A penny or less.
Major players in the industry include:
Sherman Financial Group
Risk Management Alternatives
Arrow Financial Services
Asset Acceptance
OSI Portfolio Services
All of these companies we regularly see in our work at UAW Legal Services. None of these companies are known as fierce litigators.
One key point that the MSN article makes clear: Paying one of these old debts can actually hurt your credit score. Debts can't be reported on your credit report if it has been more than 7 years since it went into default. Zombie Collection Agencies are notorious for re-aging account to reflect a more recent default date. Also, in some cases and in some states, a payment on an old account may rob you of your statute of limitations defense by starting the clock all over again.
MSN Money - Zombie debt collectors dig up your old mistakes
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How to reverse boycott debt collectors.
ReplyDeleteWhen a debt collector/debt collection/debt buyer company can repeatedly call with the intent of getting money their customers can repeatedly answer or call back with the intent of not giving them any. They need people to pay with as little talk as possible. They don't want to talk with people who know they are never going to pay. Be all talk and no pay. Answer when convenient. Call back. Give no information. Verify nothing. Ask as many questions as you can. Answer none.
Don't ignore/block/report them. It doesn't work. These folks want you to ignore them for as long as you can stand to or until you give them something valuable like money or information. Ignoring them is being their good customer. Sending a cease and desist is giving information. It lets them know you are still alive and remain their good customer. Preparing to initiate unlikely individual legal battles is being their good customer.
Be their bad customer. Make them talk to you fruitlessly for as long as they can stand to or until they stop selecting you as their customer. These companies cannot spend seconds much less minutes on the phone with every person who will never send them a dime. But they don't know who that is. You do. That knowledge is power. Every second you can keep their staff on the phone will render their business less profitable giving them a reason to never call you again.
Calling will not reset your SOL. Making a partial payment will.
One person who does this likes to ask general questions they should but usually won't answer, "May I have the name and address of your agent for service of process?" Calmly and slowly ask them to spell every word in the address. Read it back for verification. Control the pace. If they are rushing then politely ask them to slowly repeat. "Are you a corporation and if so in which state are you incorporated?" Repeat your questions when you don't get direct answers. When they won't answer a question ask, "Would you like to comply with the business and professions codes of your state?" That is usually the point when they hang up on me but if they say they want to comply then begin your questions again.
Repeat while you have the spare time. These folks have many victims and few operators. If everyone calls back but pays nothing the mass auto-dialer business model becomes unprofitable. Don't aid and comfort the enemy by ignoring them. Call! Have a nice long slow friendly chat! Make them hang up first.
Press 2 for Spanish.
There are certainly enough victims to take down debt collectors so ignoring/blocking seems downright Orwellian. Really? We're just going to passively submit and go with a block list or however we manage ignoring an endless stream of unwanted phone calls day after day? No! Unite or remain conquered. Answer/return every call - become well practiced at keeping these folks on the phone - or count yourself not amongst the free.