$141 Billion of Consumer Debt was charged off last year

The Boston Globe is doing a series right now called “Debtors’ Hell” in their last segment, Part 4, they state, “They generally owe the money, but seldom anticipate the consequences.” I have found that to be my experience even when the consequences were printed on the credit application they have signed.

Richard S Daniels Jr. the Boston lawyer The Globe interviewed said it perfectly, “Any system that puts people’s backs up against the wall doesn’t work.” If you listen to my interview on NPR that aired on January 29, 2003 on All Things Considered, you will see that I spent my debt collection years trying to help debtors to get the bill paid that I was collecting on while having understanding for their situations. Sometimes this meant advising my client there was a hardship situation, or offering a settlement amount and taking payments. This only works with the debtors who seriously have run into hard times, not the “career” debtors. I created an online community for debt collection professionals and explain in my book “Starting a Collection Agency, How to make money collecting money” that being a bully does not work and is also against the law. Compassion, patience and understanding will help you collect more money and also let you and the debtor keep their dignity in an already embarrassing situation.

I am not saying everyone follows these practices but I think that debt collectors have been given a bad rap collectively and there are many collectors out there who follow the law and try to work with people rather than bully them into paying. I encourage collectors to join associations in the collection industry, as well as the Better Business Bureau and their local Chambers of Commerce. This is because when you are operating an agency, even if you are the most perfect agency on the planet, this will let anyone who is considering using your agency see that you belong to these organizations, which lends your agency credibility and shows you have ethics. The people who hire an agency, should realize the agency they choose is a reflection of their business, and not choose an agency because it is the lowest price, but because it is an honest, ethical agency that can back that up with references and statistics.

Something to consider is if there are debtors who feel they are being treated unfairly by a collection agency, we might want to look at the creditor that chose to use that agency. Why did they choose that agency? Maybe they are not aware the agency might have done something they wouldn’t have done, but shouldn’t they be?