Debt collectors may seem intimidating, their trained to be that way to recuperate debt, as their infamous for their aggressive and violent techniques, as they will harass and threaten debtors with various consequences.
The following information will be helpful when dealing with debt collectors as OUDS explains how debt collectors function:
Understanding how debt collectors operate
When consumers fall behind on their payment obligations, they are likely to receive multiple notices demanding payment. For the consumers that fail to pay, the creditor is likely to hand the matter over to a debt collection agency, which will consequently result in the consumer being contacted by a debt collector.
Certain debt collectors are aggressive and threatening right from the start, whereas others may start out by acting relatively polite and friendly on the phone; but if you don’t agree to make a payment arrangement immediately, they will turn up the heat the next time they call you and start to apply pressure.
Some debt collectors deliberately implement the “friendship” strategy of starting out being really friendly in order to mislead consumers into letting their guard down and saying something that will help them collect upon the debt. Understand they’re not your friends, their trying to get money from you. So be advised most often these collection agencies employ telephonic recording systems that record your call which can be used against you if you consent to a payment and cannot honour the arrangement. It is concerned consent to debt, so do not make a promise to pay unless your 100% sure you can honour it.
Other debt collectors are paid according to the number of collection calls they place, emails/SMS’s/faxes they send or number of demand letters they send out, which is another method that offers them a financial incentive is being pushy and persistent or worse.
Other debt collectors/agencies don’t work for creditors at all; they purchase a creditor’s old prescribed debt book, often at a discount. In South Africa it is common practice for Creditors’ to sell their Debtor’s Book to Debt Collectors or agencies – who will then collect upon the debt. The reason these Debt Collectors’ purchase the book is with the aim to collect more than what they paid for the Debtors’ Book; trying to make a profit by collecting as much debt as possible and charging questionable fees as part of the process. When they phone consumers, they often entice them to make a small payment so that the longer they can drag out the process the more fees they can charge, thereby creating a vortex of repayment the consumer just seems to be unable to escape from.
Debt Collectors are aware that statistically, the longer a debt goes unpaid, the less likely it is that they will ever recover it. This knowledge drives them to start out strong and also encourages them to create a false sense of urgency when they talk to you. For example they may pressure you to commit to paying your debt by a specific deadline or according to a very short timetable.
A threat which works well on most consumers is the one about being “blacklisted”, because it’s difficult to live without access to any form of credit, but the National Credit Act prohibits the listing of a prescribed debt upon a consumers credit profile.
Therefore it’s unethical for debt collectors to use the threat of “blacklisting” a consumer’s credit profile, in an effort to coerce payment out of you.
If you don’t consent to their demands, debt collectors may try other scare tactics to get you paying by threatening you with legal action, the loss of your personal property, garnishing your salary or issuing a Judgement against you, even the threat of jail time (no one can be locked up for owing debt) – regardless of whether these consequences are likely to happen or are even legal.
IMPORTANT: “ALL” debt collectors need to be registered with the Association of Recovery Agents (ADRA) and openly provide you with their registration number. Be advised that the collection company is not registered under one membership number, but all agents of the debt collection company have to have their very own registration number. If any “debt collector” approaches you and they do not have a debt collectors registration number be advised that they are then collecting illegally and you are within your rights to report them to ADRA.
Note: Attorneys firms do not require registration with ADRA, hence there are many legal firm that specialize in debt recovery. This does not mean that they are above the laws of responsible debt collection though! They have to follow the same legal collection process like everybody else.
Therefore OUDS is willing to assist consumers in this predicament with a free service of a financial assessment, assist the consumer to organise an affordable, realistic and structured monthly budget and debt management plan thereby providing consumers with a guideline for eliminating and remaining out of debt.
Oyisa United Debt Specialists is therefore committed to assisting consumers struggling to make their debt repayments and facing financial difficulties, to solve their debt problems and empower them to take back control over their financial situation.
With over 11 years of specialized experience in the debt & legal field Oyisa United Debt Specialists is committed to assisting South African consumers in financial liberation.