What is a Creditor

When a consumer owes a creditor money for services or a product the creditor must try to collect. First, what is a creditor? A creditor is any company or person that you owe a balance to. Examples of a creditor consist of companies like Capital One Auto Finance, Wells Fargo and Rent-A-Center.

Assigned Debt

When a debtor owes a creditor money and the debtor has issues with paying, the debt clock start ticking. The debt may go late 30, 60, 90, 120, 150 and even 180 days late. The creditor at this point will assign the debt to a collector, aka collection company. When a debt is assigned to a collection company this simply means that the original credit grantor still owns the debt.

The debtor has the right to pay either the collection company or the original creditor when a debt is in assigned status. Most debt that is assigned is hospital debt, cable bill debt, rent debt and some student loan debt.

Sold Debt

When an account is in debt status the original creditor may sell the debt. This means that the original creditor was unable to collect the debt and normally they will write the debt off. At this point the debt is sold to a collection company. The collection company will purchase the debt for a very small amount and then collect on the debt.

When a debt is sold, consumers cannot pay the original creditor directly and they will not talk to you. The original creditor will say “you need to call this number and deal with them, we do not own the debt any longer”.

As a responsible consumer you have to do your best not to let yourself be a victim of the debt clock that will haunt you for 7 years on your credit report. The best thing you can do is always keep in contact with your creditors and if last resort is to make a payment plan, then do it. If making a payment plan keeps the record off your credit report and keeps the creditor from selling or assigning the debt, then that is a great trade off.

Empower – Educate – Take Action

H & I Credit Solutions

Collection Accounts can be removed but it is important to understand the different types of Collection Accounts.

The following is how most collection company’s conduct business. Have you ever wondered what a collection company offers to businesses? Below you will find a brief description of how they operate and how they benefit creditors. Don’t be surprised if you recognize some of the techniques listed below.

To hide the Collection Company’s name I have replaced it with “CC” (Collection Company). This information is directly from their website.

Performance and Expected Results

We implement the collection process as soon as the account is entered into our system. With the methods used above, you can expect returns within 15 to 30 days of placement. Utilizing all of our tools and technology we on the average collect 10%-20% higher than our competitors.

Dunning Procedures

The next step is effective communication with the debtor. We train all of our collectors on the “get paid today” philosophy. There are a few reasons for delinquency, i.e. circumstantial, intentional, and emotional. Once our collector has obtained the reason for delinquency, this enables him or her to maximize the return by overcoming the objection.

Caller-ID Capture

All of our collectors are equipped to capture almost all location and phone numbers from debtors whether they like it or not.

In-House Law Office

You can feel confident in the fact that we provide an in house attorney whom specializes in FDCPA collections and contract litigation. Our experience has taught us that most debtors tend not to respond to normal collection agency practices, but once they receive communication form an attorney they tend to respond and settle at a much higher rate. This is another service at no additional cost to our clients.

Credit Report Placement

Through our experience in dealing with debt collections, we have found that placing items on credit reports is yet another way of increasing our recovery rates. Based upon the technological avenues that “CC” has, items are placed electronically to ensure expeditious reporting and results; all this is done at no cost out our clients.

Highest Collection Return

“CC” has developed a reputation for delivering a higher than expected return on placements than our competition. Numerous audit controls ensure you are receiving what is collected accurately, and on a timely basis. Our clients will vouch for our integrity. We will furnish you with a list of our references. If more are requested, we will be happy to provide you with additional names.

Empower – Educate – Take Action

H & I Credit Solutions

One thing consumers really need to pay attention to is the inquiry section of their credit report. Keep in mind that inquiries stay on your credit report for two years. Anytime an inquiry gets placed on your report it can lower your score by three to ten points, as you can imagine this is not a good thing.

The following happens all the time; more so than you would even believe. Trash debt collectors will pull a consumers credit report just to see what debts they can possibly buy from another debt collector. Sometimes these trash debt collectors are attorney’s that think they can muscle consumers into paying if they send a letter head from their law office to the consumer. This is unacceptable and is illegal for a company to access your personal credit report without authorization.

Consumers must keep an eye on their credit report when they are in the market of making any purchase that relies on that information.

Empower – Educate – Take Action

H & I Credit Solutions

All I can say is WOW! This topic will probably make you feel a little taken advantage of. However, get ready for an explanation. You may be asking yourself, how and why would I think of a collection company as being my friend. The bug me, they harass me and they are annoying.

Well, let me ask you a question. If someone owed you $500.00 dollars and never paid you, how would you collect the money? How would you locate this person? Where would you even start looking? I will answer all of these questions in two words. These two words are “Social Networking”!

Our society has come along way in the past 10 years with technology and it is amazing what you can find out about someone on the internet. You can find anything and everything on the internet; sometimes you can even purchase the information. Believe it or not, Collection Companies will go to any extreme to find someone. They have now started using social networks to track people down. Social networks that they use include www.facebook.com , www.myspace.com and www.twitter.com . Yes, I said it and believe it. They create a bogus profile and send you a request to be a friend. Collection Companies create several alias profiles on social networking websites and then track you down. www.twitter.com is the best because the consumer updates in real time what they are doing. How scary is that to know that a collection company could be sitting right behind you just because you told the world where you were at?

Be careful and be watchful, you may be friends with a company that is tracking you down like an animal to collect money.

H & I Credit Solutions