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Inside the Dark, Lucrative World of Consumer Debt Collection

nytimes.com

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Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#111

Post by prostoalex »

forca wrote: post #105
prostoalex wrote: post #93

Earlier quoted context omitted.

Um, there are more not-for-profit hospitals than there are for-profit hospitals, which doesn't dramatically change the pricing equation. http://www.aha.org/research/rc/stat-studies/fast-facts.shtml One man's profit is another man's stash for bonuses and building a new wing of the hospital.

The goal is zero profit in health care.

Where does a dentist then raise money to buy a new XRay machine?

Where do you find money if your top doctor wants a raise or threatens to leave for a competitor?

Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#112

Post by kclay »

Man, me and the wife are dealing with this right now (didn't read yet). One company sold to another to keep it going. We got it off but now the next company is trying to collect so we have to go through it again, but not until it hits her credit. Just BS if you ask me.

Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#113

Post by dllthomas »

opendais wrote: post #62
dllthomas wrote: post #49

Earlier quoted context omitted.

It might depend on what you mean by ethical. Certainly there's a world where treating people well makes them more interested in cooperating with you and that leads to a higher collection rate. I have no idea whether we inhabit that world.

Doesn't use the shady, illegal tactics + settles for less than the dollar value of the debt. For instance, they buy it for $.05 and settles for whatever the debtor can reasonably pay that covers costs plus a reasonable margin, like 100%. So they buy it at $.05 and let the debtor pay it off for $.10 + the collector's cost. I'd guess that is something like 25-50% of the value of face value of the debt.

I wonder if you could run it as a non-profit, offering reductions in exchange for classes on budgeting, &c, (where appropriate) and making up some of the shortfall with donations.

Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#114

Post by snuxoll »

prostoalex wrote: post #93
forca wrote: post #63

Earlier quoted context omitted.

Medical debt rankles me like nothing else. The US, supposedly the most advanced nation on Earth has the worst notion of all: health care for profit. Simply evil. Health care is a basic human right. Full stop. Health care should never be based on one's ability to pay. Never. I pray I see socialised medicine in the US in my lifetime. If Hilary Clinton gets elected, the push for this will be stronger than the thin edge…

Um, there are more not-for-profit hospitals than there are for-profit hospitals, which doesn't dramatically change the pricing equation. http://www.aha.org/research/rc/stat-studies/fast-facts.shtml One man's profit is another man's stash for bonuses and building a new wing of the hospital.

The hospitals aren't the problem, every hospital in the Boise, ID area is non-profit and frequently they work with those without coverage to significantly reduce or completely write off their medical expenses.

It's the insurance system that is the problem, since I have insurance the hospitals won't give me a dime off my bill, and my costs are heavily inflated because those of us WITH insurance are subsidizing those without.

Now, I'm a software engineer, I make a comfortable income and have a high deductible healthplan and a health savings account, I know I will be able to afford health expenses should they come up, at worst I can make payment arrangements because my annual out-of-pocket max is $5K/10K (individual/family).

But many families in my area are just scraping by on barely above minimum wage, and planning for health issues is not high on their priority list. If something happens to them, the $5K debt can be devastating, and it would take them YEARS to pay off what I can in months.

Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#115

Post by bequanna »

forca wrote: post #63
ams6110 wrote: post #26

I was called by a collector once. Old medical bill, the clinic had sent it to an old address and the mail forwarding had expired. Why they never called or tracked me down I don't know, but they eventually sold it to a collector who had no trouble finding my phone number. When they called I was confused at first, then remembered and realized it was legit, paid it, end of story. They were utterly professional and court…

Medical debt rankles me like nothing else. The US, supposedly the most advanced nation on Earth has the worst notion of all: health care for profit. Simply evil. Health care is a basic human right. Full stop. Health care should never be based on one's ability to pay. Never. I pray I see socialised medicine in the US in my lifetime. If Hilary Clinton gets elected, the push for this will be stronger than the thin edge…

I agree, but I think there is too much at stake for too many high net-worth individuals and corporations for the US to make a change to the single-payer system.

A 10% rise in taxes? That's a heck of a lot of money. The majority of the rich won't buy into it, they'll fight it tooth and nail.

In my opinion, I think it depends on how well appeals for/against a single-payer system resonate with the middle class. Do they generally feel that they will be subsidized, or be subsidizing?

Heck, even some poor people (who would be net winners) won't even support it on principle.

Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#116

Post by snuxoll »

prostoalex wrote: post #111
forca wrote: post #105

Earlier quoted context omitted.

The goal is zero profit in health care.

Where does a dentist then raise money to buy a new XRay machine? Where do you find money if your top doctor wants a raise or threatens to leave for a competitor?

Profit != revenue.

Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#117

Post by dannypgh »

Terr_ wrote: post #57
nostromo wrote: post #10

I think that borrowers should have the right of first refusal when their debt is sold. For example, if you're about to sell $1.00 worth of my debt to someone for $0.10, first you must offer it to me at the same cost: $0.10.

That seems simple and fair at first, but I think it actually creates more problems than it solves. First, you get a horrible incentive to not repay debts: 1. A relatively innocent and good-natured Bank lends a jerk $1.00 2. The jerk refuses to pay it back, knowing the bank can't transfer it to someone who isn't a pushover without giving him a steeply-discounted offer first 3. In response all loan requirements and int…

Your credit score (and collateral, if it's a secured loan) is your incentive to repay the debt at face value. So I disagree that people would choose to default just because they can get it for pennies on the dollar. And given the ability of people to do that would be rather limited (as after the first time they'd have shot their credit score) it doesn't seem like it would create any sort of unworkable problems for the industry.

Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#118

Post by derefr »

AdmiralAsshat wrote: post #79
opendais wrote: post #35

Earlier quoted context omitted.

Do you think its financially viable to run an ethical debt collection agency?

You'd have to first define what constitutes "ethical" as distinct from "legal". If you're of the opinion that the very practice of collecting debt is scummy or unethical, then no. Assuming you will allow for at least SOME form of "ethical" debt collection, we'd have to narrow down what kinds. For instance, just off the top of my head, you've got: - Commercial Debt - Medical Debt - Student Loans - Bad Checks Within th…

> As someone who was still in college myself only a few years ago, the idea of the financial burden imposed on me for the rest of my life simply for doing the thing that society practically strong-armed me into doing seems, to me, ridiculous; for that reason I am hesitant to call any form of Student Debt collection "ethical" simply because the laws which govern it are atrocious.

What happens when you don't pay your Student Loans for years and years? Since it's a "guaranteed loan", it can't actually (continue to) impact your credit rating, can it? So could you effectively decide to just "let it ride" until you die of old age, never having paid a cent of it?

If so, I think this is basically the idea behind of guaranteeing the loan in the first place: to give the people who can't pay their debt the ability to just ignore it forever.

Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#119

Post by wpietri »

judk wrote: post #82
shkkmo wrote: post #53

Earlier quoted context omitted.

What about a non-profit that purchases this debt and then targets the debtors with the tools and support to get them back on their feet to the point where they CAN pay off the debt?

Non-profit "debt counselors" is actually a huge scam industry that operates in the loopholes of nonprofit debt-counseling law.

Does anybody know more about this? I've seen ads for places like that and they set off my scam-o-meter, but I've never dug in to see how he scam worked.

Re: Inside the Dark, Lucrative World of Consumer Debt Collection

#120

Post by dannypgh »

eli wrote: post #41
pavel_lishin wrote: post #19

Earlier quoted context omitted.

I can also just wait out the debt period, until it passes the statute of limitations, and not pay anything at all - but I don't, because I prefer having a decent credit score and businesses who will do business with me.

They could also exercise their option to sue you before then.

I would suspect most of the people who are defaulting on debts don't have significant assets or income to make it easy to recover debts, even with a court order.

The option to sue is reasonable because otherwise people who are too rich to need credit would often find themselves in positions where there's little-to-no incentive to pay back. But these aren't the bulk of debts that these agencies are working with - the bulk of people who are defaulting on loans aren't people with money, they're people without money.

Frankly the harassment techniques that a lot of debt collectors use are disgusting and they prey on those who already are suffering. The FDCPA makes a lot of these techniques illegal, but the protections the law provides aren't widely known.

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