The Wall Street Journal has an interesting article today, about the psychological wear of dealing with debt collection efforts. The story talks about the daily calls, 40 to 50 of them, one borrower received.
Obviously, the Fair Debt Collection Practices Act limits the contact that a bill collector can have with a borrower, but, even within the protections of that law, creditors can continue some pretty aggressive collection efforts.
This is where the collections process by an attorney and a collection agency part ways. When an attorney “escalates” collection efforts, the attorney has a number of tools at his or her disposal, such as a lawsuit and, post-judgment, bank levies, wage garnishments, and liens.
A collection agency, however, can only make more phone calls and escalate the frequency and aggression in the contact.
It’s obvious from the article that borrowers are adapting to collection efforts, even inventing mechanisms to avoid creditor phone calls, and learning other ways to beat the system. In this sea of debtors drowning in debt, the traditional collections method of bothering borrowers day and night certainly isn’t doing any good.