Debt Purchasers

The original creditor has exhausted all his internal and external collection agency resources and yet the debt remains unpaid.  Aging probably exceeds one year or more and the creditor has little hope of collecting on the account, and legal action is an expensive shot in the dark.  Their final option is to take their tax write off and sell the debt to a 3rd party company known as a Debt Purchaser for pennies on the dollar.  You can tell they are a debt purchaser by their original notice that they are the new owners of this debt and you must deal with them.

These are the companies that purchase your debt as a last resort to collect your funds.  Their employees are less polished or professional and dealing with them can be unpleasant.  They are usually more aggressive with nasty letters and calls threatening legal action if the account is not paid.  These threats are mostly idle.  Remember they bought the $5000.00 debt for probably only $200.00 – $250.00.  Why would they waste money for a protracted legal fight when they could settle the account for $1500.00 (30%) and make a handsome profit.  Don’t be intimidated by their antics.  Control and time are on your side.

Negotiations are the same as with collection agencies.  Don’t contact them until you have the money available (only want lump sums), then call 7 business days prior to months end (quota time).  Start with a lower amount $1000.00 (20%), and if not successful wait another month and raise the offer slightly, if necessary, and keep following this strategy until they agree.  They should settle for well below 50%.  Remember, by this time this is considered “junk debt”.  The owner has only spent pennies on the dollar and they want to make a reasonable profit and move on.  You can get your best deals with these collectors.

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One comment

  1. Beneficial info and excellent design you got here! I want to thank you for sharing your ideas and putting the time into the stuff you publish! Great work!

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