Debt collecting agencies are not thugs who go around breaking customers' kneecaps when there not able to repay their debt. Even so, when you are in a money crunch, coping with debt collectors can be a pesky task. There are a few, though, that are still using bullying or illegal tactics to force consumers into paying overdue bills.
The FTC reports that complaints pertaining to debt-collection agencies are in the top three categories of complaints. Being well-educated about your rights and what you can anticipate from debt collectors can give both parties involved a suitable arrangement that's acceptable to everyone concerned.
If your late with a credit card payment [or haven't sent it yet] and the payment hasn't been received by your card issuer by 10 days after the payment due date, the card issuer will in all probability mail you a neighborly letter prompting you that your payment is overdue. If you neglect to make 2 payments in a row, you'll typically receive a more severe sounding letter asking for immediate payment of the overdue amount, and the creditor might follow through that letter with a telephone call inquiring where your payment is.
After 60 days or more being overdue, you might find your credit card locked and you account terminated. A lot of financial institutions are willing at this point, to reopen the your account if you are able to get your finances in order. Other elements that could cause a financial institution to shut your personal credit line...If your revenue declines, or your debts rise. Once you account goes 90 days or more overdue, a lot of creditors will start "writing off" the your account as a bad debt.
That implies they have determined that their not able to collect the money owed through typical means, and regard your account a "bad debt." If your account is not written off after 90 days, you'll receive more communications from the financial institutes collection section. If you still can't or don't pay, the creditor will likely write your account off when it becomes 120 to 180 days overdue.
Once your account is written off nearly most of these lenders will hand it over to a debt collecting agency. Generally, the smaller the institution, the faster they'll write off their overdue accounts [because smaller issuers are less likely to have advanced internal collection capabilities]. If the creditor's collection section can't get the money owing from you, it will then be passed on to an external collection agency.
A collection bureau is a institution whose business is collecting outstanding debts. A lot of these collection companies are paid on commission: They typically collect between a 3rd of the overdue balance for the creditor. Instead, some collectors or investors will "purchase" bad debts for about 50 percent of the value and attempt to collect the debt themselves.
And you're stuck in the middle having to deal with these unscrupulous debt collectors. There's so much more that the average person does not know when it comes to so-so people! Make sure you know your rights and what these agencies can legally do.