Next time debt collectors call, it may help to know that the
collectors may be just as afraid of you as you are of them.
In July 2015, debt collection comprised 31 percent of consumer
complaints to the Consumer Financial Protection Bureau. The CFPB
that for 23 consecutive months, debt collection complaints
outranked gripes about other financial products or services, such
as student loans or credit cards. Consumers reported collectors for
trying to collect a debt not owed, for lying, for threatening to
send them to jail or sue them, and for calling at inconvenient
times or at work.
Most legitimate debt collectors follow federal debt collection
laws curtailing abusive behavior, but many have a few complaints of
their own about being on the receiving end of bad behavior.
Take Michelle Dunn, a former debt collector and collection
agency owner who's now a consultant and author of books for debt
collectors, including "The Guide to Getting Paid." She remembers
the day an angry debtor showed up at her office.
She was making collection calls in New Hampshire for a local
heating oil and propane company. One customer was so late paying
his bill that Dunn told him a driver from the company would stop by
to pick up his propane tank.
"He hung up on me and drove over," Dunn says. "He came right
into my office -- he was screaming and yelling." The man put his
hands on her desk and leaned forward, shouting until his face
turned red. Dunn tried to squeeze around the side of her desk, but
The cops forced the customer out and came back every afternoon
for a week to escort Dunn to her car after work. "It was shocking,"
Who's collecting your debt?
While many debtors lie in fear of debt collectors, that angst goes
both ways, says Dunn, who holds webinars to teach debt collectors
the tricks of the trade.
Though about 75 percent of debtors are polite and cordial, that
doesn't calm the anxiety of newbie debt collectors, Dunn says.
"Most people are nervous about making the calls, especially if
they've never done it," she says, adding that many debt collectors
want to avoid confrontation. "They're trying to learn how to
effectively make those calls so it isn't so scary."
Doesn't sound like your image of a debt collector? That might be
because some of the public perception of debt collection agencies
is based on media coverage of the actions of scam artists and
criminals posing as legitimate debt collectors, says Mike Bevel, an
editor at insideARM.com, a debt industry publication.
"So, when a consumer gets a call from debt collection agency,
they're primed to think, 'This is going to be the fight of my
life,'" Bevel says.
Also, the collection industry is becoming somewhat kinder and
gentler, partly due to the actions of the CFPB, Dunn says. For
example, the industry has moved away from paying commissions and
toward rewarding and promoting collectors who follow laws and
regulations, says Terri Haley, a former debt collector who is now
director of compliance at insideARM.com.
So who are these new debt collectors? Many come from customer
service backgrounds, Haley says. The industry tends to attract job
seekers looking for schedule flexibility, she says. "I started
because I was a single mom," Haley says, adding that she needed to
be able to be available to get her kids on and off the school
When she owned her collection agency, Dunn says she hired former
secretaries and hairdressers. "They're people from all walks of
life," she says.
Collection jobs can include working in-house for a business --
such as a credit card company -- making calls on past due accounts
before they get sent to collections. Debt collectors also can work
for agencies, which range in size from mom-and-pop shops that
collect for local dentists, doctors and hospitals, to "mega
agencies" with thousands of collectors.
The average full-time debt collector job, including commissions,
pays a modest $38,000 a year, according to ACA International. In
fact, some debt collectors have firsthand experience with debt
problems. That's what happened to Dunn when she got divorced and
became a single mom of two boys.
She got behind on her mortgage, payments on a freezer the couple
had bought on credit and on credit card bills. While she was going
to work every day to make collection calls, her own phone started
ringing. One debt collector tried to pressure her to pay a balance
in full by implying she was a deadbeat, asking what her kids would
think of a mom who didn't pay her bills.
"It was pretty horrible, so I know bill collectors do this," she
A day in the life of a debt collector
About a year ago, when Candace Ames (who asked her real name be
withheld to protect her privacy) worked for a third-party agency
collecting on bounced checks and overdrawn checking accounts, along
with car, personal and student loans, she worked 20 to 30 accounts
an hour, making about a call a minute. After a year, she quit.
She says it was "exhausting" to explain the same things over and
over, such as that even if one spouse overdrew the joint checking
account, the other was just as responsible for overdraft fees. "It
was surprising how little people knew about their loan contracts or
checking accounts," she says.
Collectors also face several other common stresses on the
Getting cursed out.
When Dunn opened her own small collection agency, her first
client was a local veterinarian. She called a man who had an
unpaid vet bill, and he started swearing at her. "I'm not paying
that bill you [expletives deleted] -- my dog died!" the man told
her. She tried calling him a few days later, and got an earful
Ames says she frequently got cursed out by debtors, but would
hang up and make a note on the account to warn the next
collector, Ames says.
Hearing wild excuses.
In her books for debt collectors, Dunn gives advice on dealing
with crazy excuses from consumers. The worst excuse Dunn ever
got? One man told her he'd been at the post office ready to mail
the check when a mugger grabbed the envelope. "I'd wonder, what
are they going to tell me next week?" Dunn says.
Dealing with bad behavior.
Some debtors would play games, pretending not to know who Ames
was, even though they'd spoken a few days earlier, Ames says. And
some would answer the phone, then barely say a word. One man
would always ask what Ames was wearing.
No matter how tough the job gets, debt collectors must follow
Fair Debt Collection Practices Act
and cannot lose their cool or make derogatory remarks.
"I've had my life threatened, but I've also gotten thank you
letters," says Dunn, as some consumers are appreciative of the help
in figuring out how to get their balance paid off.
Inside tips from debt collectors
Now that you know that unpleasantness can go both ways, how can you
use that to your advantage if you ever get a collection call? Here
are four tips from the mouths of debt collectors:
Virtual debt collection lets you negotiate, settle
Automatic stays in bankruptcy stop debt collection
Know it's not personal.
In her first collections job,
Dunn made calls on past-due business accounts, which was easy
compared to dealing with consumers, who tend to get emotional and
take things personally, Dunn says. Remember, it's not. "This is a
business call, that's all it really is," Haley says.
Facing a job loss, illness or divorce? You can describe your
situation, but don't say too much. "Some people tell you their
whole life story -- their mother-in-law is in the hospital, their
husband lost his job and their dog just died," Dunn says. But
divulging too many personal details -- for example, about the
symptoms of a medical condition -- isn't necessary and won't help
your case. "Because you're sicker than the man I spoke with an
hour ago, I can't give you a better deal," Haley says.
Don't be afraid to ask for a supervisor.
If you're trying to work out a payment plan or other settlement
that fits your budget, and the collector says no, ask for a
supervisor, Dunn says. If the collector doesn't have the
authority to agree to a plan that works for you, the boss might,
she says. Before you get transferred, ask for the supervisor's
name and extension. "Then next time you can skip the person who
couldn't make a deal with you," she says.
Know the collector is not your friend.
The most successful debt collectors take a collaborative
approach, listening and suggesting ways you might be able to pay
your bill. So, remember that even the most affable debt
collector's interests are different from yours, says Jared
Strauss, who owns a debt settlement business and worked as a debt
collector years ago. Take your time and look at your overall
financial picture and all of your debt before agreeing to
anything, he says. "Do the math and figure out if there's a way
to tackle everything at once," he says.