Debt Collection for Dummies

What is debt?  Simply put, debt is a financial obligation that is owed or due.  People believe that debt is what keeps collection agencies in business, but their real job is to protect the rights of their clients/creditors.  Debt collectors are often viewed as conniving, money-hungry scoundrels who are trying to squeeze every penny out of you.  As a college intern at Credit Consulting Services (CCS), I have learned that this could not be further from the truth.

After logging about 8 hours of training videos in addition to listening in on collection calls, I like to think I can help my fellow man learn exactly what CCS does.  First, debt collectors are not some boogeyman-like person you tell your children about so they don’t misbehave.  Instead, I found that debt collectors can range from the young mother of four trying to support her kids to the sweet old lady who has been doing this for nearly 40 years.

Despite popular belief, receiving a call from a debt collector is actually a good thing.  Their job is to help not to harass.  Even if they wanted to be “evil” debt collectors, the Federal Debt Collections Practice Act (FDCPA) protects the consumer from harassment of any sort.

CCS is a third-party agency that is contracted by a company to collect their debts.  In other words, if a consumer is provided a service through credit and has not paid the business or firm for that service then CCS has the ability to step in.  CCS can only act upon this debt if contracted by the business and if the debt is “delinquent”.  Delinquent debt is debt that has not been repaid for 30 days or more.

I found that a common form of debt comes as an overdue medical bill.  Unfortunately, many people do not understand what insurance covers and does not cover.  Patients often do not know that they have to pay for part of their bill.  Fortunately for the consumer and the hospital, a CCS collector will call the patient letting them know that the bill is overdue and advise them on the best way to pay back this debt before it gets out of hand.  The consumer has one less worry and the hospital gets its money.  The icing on the cake is that the hospital does not need to raise prices in order to make up for the unpaid bill.  This saves future consumers money and helps to combat against debt accumulation.  So in a way collection agencies provide an important service to society.  Some may even say we are heroes.  You’re welcome America.

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