Debt Collection | 3 Reasons Why They Increase Intensity

10628297_sYou know you have debt obligations, but are you finding yourself getting uncharacteristically bombarded with collection calls.  Here are a few very important theories as to why that may be.

It may be that creditors are breathing down the necks of the collection agencies to collect all they can.

We in the US are still experiencing at least a Recession, some may say a Depression.  Money is hard to come by, and collection agencies are very numerous, so expectations are quite high.  If your agency cannot perform then the one down the street will fight for your business.  That said, these agencies are often forced to be relentless in their practices in order to satisfy their clients expectations.

Another Theory may be a States Statute of Limitations.

Each State has a statue of limitations in which to file a lawsuit or wage garnishment.  http://credit.about.com/od/statuteoflimitations/a/entirestatesol.htm

If calls seem to be increasing, it may just be that the statute of limitations related to this particular debt may be close to expiring.  If this is the case, collection agencies will work feverishly (on behalf of their clients) to get this settled before the statute expires.  Often times they will do everything they can to get you to pay all or at least a percentage of the debt, because guess what, if you pay a percentage, you have just reaffirmed the debt, and the statute of limitations, resets.  Depending on the state where the debt is held effects the statute of limitation, or the timeframe in which the creditor can ask the court to force you to pay for the debt.  For instance, if you have a debt, in say the state of New York which is 5 and 1/2 years old they have 6 more months to collect.  If you make a minimal payment, or agree to a payment plan in writing, then the Statute resets which will give them 6 more years to collect on this particular debt.  So, be conscious of your states statute of limitations.  If you get a summons to appear in court, make sure to be there, do not risk a default judgement. Better yet, pay your debt off and always limit the amount you borrow.

Another Theory is that the Debt is Sold.

Once the debt reaches a certain age, creditors often sell it for pennies on the dollar.  Once it gets to the point where it is sold, investors will use the most aggressive collection agencies (often those with many harassment complaints with the Better Business Bureau) and seriously turn up the heat to get you to pay.  The flip-side to this is, many creditors such as medical facilities use this as a last resort, if at all.  They are conscious of the potential public relations backlash if their patients are being harassed by collection agencies, they often just write this debt off.

I hope this help you if you find yourself in a debt management situation!

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