Has the Legal Collection Strategy Gone Too Far?
Legal collections have long been an effective strategy to collect money from consumers. Now, it appears that it is becoming a central strategy.
Last October at the FTC debt collection workshop, much of the consumer representatives’ time was spent railing against the ARM industry’s growing love affair with legal collection strategies. It's become common for all of the publicly-traded debt purchasers/collectors to extensively discuss their legal collections in quarterly earnings calls.
Now, one collection attorney in Oregon has gotten into trouble for his actions in cases filed against consumers ("Oregon Collection Lawyer in Hot Water Over Suits," Feb. 12). Apparently, he sued a lot of consumers.
So is this just a case of consumer advocates latching on to an effective strategy? Or has the industry become too reliant on “non-traditional” collection techniques?
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Comments
Comment from BHVBBAD on February 12, 2008 at 3:11PM EST
I am not sure how "legal" collections is a bad thing. First and foremost it takes any dispute between the debtor and the individual collector and allows the courts to settle the matter. You tell me, what is worse for a creditors image, a 10/hr person calling the debtor 2-3 times a week, or allowing the debtor his day in court.
Comment from Anonymous on February 12, 2008 at 3:55PM EST
Payment can always occur before legal action is taken, it is up to the debtor.
Comment from JN on February 13, 2008 at 9:18AM EST
I have to agree. Avoiding lawsuit is COMPLETELY in the hands of the consumer. You can't dodge your debt forever. It's not like Debt Buyers are suing every account they get. No point in suing someone who doesn't have any assets. This is just another thing to harp on when it comes to people wanting to protect consumers. If you own your home and are dumb enough to avoid your debt, then you get what you deserve. They'll take $50 a month over nothing at all. ANSWER THE PHONE!!!!! When it comes to a courtroom, you will be judged by how you responded to your debt collectors. You'll look a whole lot better in the eyes of a judge if you at least ATTEMPTED to pay your bills.