Debt Collection Agency?

[bkyle1991]

I cant find much information on this niche industry. It seems somewhat secretive in nature. Theres a couple books on the subject but not much else, I would of loved to find a comprehensive course.

Overall this seems very interesting to me, buying debt for pennies on the dollar and dialing for dollars. I have my real estate/mortgage licenses but I dont think the calls for those two things could hold me over if Im going to make the phone my MAIN marketing weapon. So Ive been trying to find more info on debt collection. I figure if my list comes with emails I could plug them into aweber, directmail and maybe social media.

I know some concepts now, somewhat how its done. Get a debt portfolio(credit cards, payday loans, etc), make contact, ect. Ive found a couple decent looking places to buy debt. I need more indepth info on adding to their credit profile, LAWS and a few other things. Not sure some things

This seems like something that I can control the growth on. Adding callers wouldnt be too expensive, debt portfolios can get 10K+ and can just keep buying.

Anyone with experience in this industry? Is there a course out there? Or can I trust the debt sellers for info? I could of sworn there used to be a good forum for this topic, but cant find it now.

 

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[Lex DeVille]

How will you control growth on this? How will you set yourself apart from the big name companies like NCO, Venture, etc., who have locations everywhere and thousands of people already handling collections? This might be something to consider before jumping into a business that purchases debt.

If I were interested in building a company that capitalizes on debt, I would probably first focus on building a company that creates its own customer base. I've worked for a massive payday loan company that did just that. First they set up numerous online payday loan companies under a slew of different domain names. All of the companies generally operate the same, and they're all automated since they're online. The customer goes to the website, and receives a loan in like 5 minutes. No customer service, no phone calls, no interaction. Once they have the loan, then they either repay (with interest), or get turned over to the company's debt collection center (assuming customer service dept. doesn't take care of it first).

In this way the company has a well-rounded system of income. They make money on every loan, and they also make money on their collections. One thing I found interesting about this particular company was that they never ever filed lawsuits on debtors. They did suggest that it could happen, but their policy was never to do so. They lost money sometimes, but because they work with debtors to come up with reasonable solutions, those debtors often return to borrow more money later on.

The whole point is that you create a well rounded system that doesn't rely on finding debt, buying debt, etc. It only relies on your ability to give people money they need, when they need it.

As for the legal aspect, you'll want to speak to a collections attorney. An attorney who specifically handles debt collection lawsuits. If your company is unable to collect a debt you'll likely end up using an attorney to take the debtor to court so their wages can be garnished. The attorney works for you, so he'll be able to give you the low down on debt collection laws. The laws are different from state to state, and there are a LOT of them when it comes to what you can and can't do in debt collections.

There's a lot to this business. More than I could even begin to describe here. Check out this PDF for a good starting point:

Collections 101

 

[Ronnie]

I'm currently employed with the biggest law firm/debt collection firm in my area..

My opinion, don't do it..

It's a bigger headache then you can imagine. From the FDCPA breathing down your neck daily, collection laws, and needy clients, you'll burn out real fast. Also, if one collector you employ screws up, your whole firm gets sued.

If you want in on the collections world look into Process Serving or Repo.

 

[Ronnie]

Also, rules change monthly depending on the client. If you still want to do this, I'd suggest hiring an attorney experienced in the collection industry to work for your company...

They don't come cheap.

 

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[Esquire]

I used to make a full time living suing debt collectors for FDCPA violations ... and was pretty darn good at it. There are more ways and reasons to sue debt collectors than you can shake a stick at.

And the worst part ...? If you get sued and lose ... you have to pay my attorney's fees.

And THAT is what ought to give you the cold sweats. If you resist me and lose ... expect to be out $10 -$20k.

And as I would always tell my opponent when negotiating a quick settlement ... if it comes down to a "he said, she said" contest ... who do you think the jury is going to believe ...? Grandma ...? Or the debt collector ...?

Exactly. You are dead in the water.

Oh ... and then there is YOUR attorney's fees ... so that $10k - $20k number I just mentioned ...? Double it.

And if you win ... well ... the fee shifting is a one way street. You are still stuck with your own out-of-pocket legal costs. One way or the other ... if the case goes to trial ... you are going to bleed cash.

The result: most debt collectors would whip out their checkbooks and write the check -- fast. The only real question was "how much."

If we are talking a quick settlement ... $6k - $8k was typical.

The fact is ... debt purchasers are getting their asses kicked ... even the big sophisticated ones (against which you have little to no chance).

Plus ... dunning debtors is almost impossible thanks to the proliferation of apps and smartphones ... and if the debtor writes you a one sentence letter that says "do not contact me again" ... then guess what ... as a debt purchaser ... you are forever barred from contacting them again.

How do you like them apples ...?

So the only thing left to do is sue them.

Are you seriously going to do that ...? Do you have the money for that ...?

Oh ... I should also add that I am a bankruptcy attorney. And guess what gets people in my office faster than anything else ...?

A debt collection lawsuit.

Which means even if you are willing to advance the cost of collections litigation ... odds are ... you will not only be out the cost of acquiring the debt ... you will also be out of your collections costs. More salt in the wound.

For the most part ... the only "debt collectors" who make money in this business are the law firms who represent the creditors in litigation. They get paid win lose or draw.

Otherwise ... it is a real tough business.

Run away.

 

[Weaponize]

I cant find much information on this niche industry. It seems somewhat secretive in nature. Theres a couple books on the subject but not much else, I would of loved to find a comprehensive course.

Overall this seems very interesting to me, buying debt for pennies on the dollar and dialing for dollars. I have my real estate/mortgage licenses but I dont think the calls for those two things could hold me over if Im going to make the phone my MAIN marketing weapon. So Ive been trying to find more info on debt collection. I figure if my list comes with emails I could plug them into aweber, directmail and maybe social media.

I know some concepts now, somewhat how its done. Get a debt portfolio(credit cards, payday loans, etc), make contact, ect. Ive found a couple decent looking places to buy debt. I need more indepth info on adding to their credit profile, LAWS and a few other things. Not sure some things

This seems like something that I can control the growth on. Adding callers wouldnt be too expensive, debt portfolios can get 10K+ and can just keep buying.

Anyone with experience in this industry? Is there a course out there? Or can I trust the debt sellers for info? I could of sworn there used to be a good forum for this topic, but cant find it now.

Hi there... I find this industry interesting as well. So much so that I just finished reading a new book (recently published) that exposes a bit of this secretive world. I found it super fascinating on MANY fronts.

You can search for it on Amazon... "Bad Paper: Chasing Debt from Wall Street to the Underworld"

 

[Weaponize]

I cant find much information on this niche industry. It seems somewhat secretive in nature. Theres a couple books on the subject but not much else, I would of loved to find a comprehensive course.

Overall this seems very interesting to me, buying debt for pennies on the dollar and dialing for dollars. I have my real estate/mortgage licenses but I dont think the calls for those two things could hold me over if Im going to make the phone my MAIN marketing weapon. So Ive been trying to find more info on debt collection. I figure if my list comes with emails I could plug them into aweber, directmail and maybe social media.

I know some concepts now, somewhat how its done. Get a debt portfolio(credit cards, payday loans, etc), make contact, ect. Ive found a couple decent looking places to buy debt. I need more indepth info on adding to their credit profile, LAWS and a few other things. Not sure some things

This seems like something that I can control the growth on. Adding callers wouldnt be too expensive, debt portfolios can get 10K+ and can just keep buying.

Anyone with experience in this industry? Is there a course out there? Or can I trust the debt sellers for info? I could of sworn there used to be a good forum for this topic, but cant find it now.

Hi there... I find this industry interesting as well. So much so that I just finished reading a new book (recently published) that exposes a bit of this secretive world. I found it super fascinating on MANY fronts.

You can search for it on Amazon... Bad Paper: Chasing Debt from Wall Street to the Underworld

EDIT: sorry for the double posting of this. can't seem to locate a delete button.

 

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[Ronnie]

I used to make a full time living suing debt collectors for FDCPA violations ... and was pretty darn good at it. There are more ways and reasons to sue debt collectors than you can shake a stick at.

And the worst part ...? If you get sued and lose ... you have to pay my attorney's fees.

And THAT is what ought to give you the cold sweats. If you resist me and lose ... expect to be out $10 -$20k.

And as I would always tell my opponent when negotiating a quick settlement ... if it comes down to a "he said, she said" contest ... who do you think the jury is going to believe ...? Grandma ...? Or the debt collector ...?

Exactly. You are dead in the water.

Oh ... and then there is YOUR attorney's fees ... so that $10k - $20k number I just mentioned ...? Double it.

And if you win ... well ... the fee shifting is a one way street. You are still stuck with your own out-of-pocket legal costs. One way or the other ... if the case goes to trial ... you are going to bleed cash.

The result: most debt collectors would whip out their checkbooks and write the check -- fast. The only real question was "how much."

If we are talking a quick settlement ... $6k - $8k was typical.

The fact is ... debt purchasers are getting their asses kicked ... even the big sophisticated ones (against which you have little to no chance).

Plus ... dunning debtors is almost impossible thanks to the proliferation of apps and smartphones ... and if the debtor writes you a one sentence letter that says "do not contact me again" ... then guess what ... as a debt purchaser ... you are forever barred from contacting them again.

How do you like them apples ...?

So the only thing left to do is sue them.

Are you seriously going to do that ...? Do you have the money for that ...?

Oh ... I should also add that I am a bankruptcy attorney. And guess what gets people in my office faster than anything else ...?

A debt collection lawsuit.

Which means even if you are willing to advance the cost of collections litigation ... odds are ... you will not only be out the cost of acquiring the debt ... you will also be out of your collections costs. More salt in the wound.

For the most part ... the only "debt collectors" who make money in this business are the law firms who represent the creditors in litigation. They get paid win lose or draw.

Otherwise ... it is a real tough business.

Run away.

DING DING DING! WE HAVE A WINNER!1

My firm is a law firm and basic debt buying agencies are the jokes of the industry.

 

[brendamage]

Sometimes these agencies act as middlemen, collecting customers' delinquent debts debts that are at least 60 days past due and remitting them to the original creditor. The creditor pays the collector a percentage, typically 25% to 50% of the amount collected.