"No Recession in the Debt Collection" proclaims an article in a recent issue of an industry trade magazine. The article goes on to explain that collection agencies are making record profits as the recession causes more and more people to fall behind in their debts. Brokerage firms are recommending collection agency stocks as "hot" investments as we slip deeper into economic stagnation. Most collection agencies portray themselves as legitimate enterprises offering a needed service. Their business plan, however, differs greatly from that of a janitorial service or an accounting firm. Collection agencies are, very simply, in the business of creating fear. They prey on unknowing, financially distressed individuals. They are the scavengers of the business community.
Most people do not intentionally refuse to pay their bills. That would be stupid. Why not just declare bankruptcy? People do not pay bills because they can not afford to. A collection agency's goal is to scare, threaten, or cajole someone into paying its clients first the collector doesn't care if you lose your car, can't pay your mortgage, or can't eat; they want your money so that they can make their money.
The only reason they even function is that consumers lack information. Not understanding their rights, or the restrictions put on collection agencies, often allows people to be pressured into making decisions that are not in their own best interests. The first step in formulating a plan for dealing with collection agencies is to understand the collection process.
