– What is debt collection and how do they work together with other companies?

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I was recently added to a collection agency which I’m currently disputing. This is a first for me.

In: 4

You owe money to someone.

You aren’t paying it.

They get tired of waiting, and assume you won’t ever pay.

They don’t have lawyers or other means by which to force you to pay.

So, a debt collection agency says “Hey, we will pay you 1% of what that guy owed you, which you must admit is more than the 0% you think you will get from him. In exchange, you give us legal authority to say what he owes us now owed to US instead. If he ever pays, all of what is paid goes to us.”

The people you owe money admit that 1% is more than 0% and take the deal.

Now the debt collector comes for you. They DO have lawyers or other means to force you to pay.

If you’re not paying money you owe to someone, they can hire a debt collector to do the work of getting the money from you. That can entail constantly trying to contact you and starting legal proceedings.

And also keep in mind the debt collector bills you for everything. Emails, text messages, phone calls.

There are 2 typical setups… 1. they are hired by the company you owe money to; 2. they buy debt at a discount and then try to collect for a profit.

1. You owe your credit card company $1000. They hire Goons, Inc. to collect from you in return for a commission on money collected.

2. They sell your $1000 account in default to Shakedown Corp. for $250 and move on from you entirely. Shakedown then harasses you until you pay them. Anything they make above $250 is revenue for the company.