Anybody any rough idea what debt collection firms pay to take on a Banks debts or Credit Card Firm Debts ? I have heard they pay around 50% of the total outstanding Debt to the Firm to take the Debt completely off their hands. In the hope of being able to recover the whole debt from whoever owes the money. Just curious what sort of percentage they will take the debt on for ?
Ok so nobody wants to give the secret away...I understand If they have brought the debt how can they still legally chase for the full debt ?
because that's how it works
tim
There's no secret. They pay a market price for the alleged debts they take over, which is a variable percentage of the full amount claimed. I've seen figures like 10-20% quoted in the past. So they need to buy quite a few in order to make a living. And they will also sell them on to other debt collecting agencies, so these alleged debts might be recycled a number of times.
Of course, should the debt claims ever arrive in court, they would need to provide evidence supporting the original claim to the alleged debt, and in addition a valid deed of assignment to prove their entitlement to claim it. Since this is in fact the very last thing they want to do, however (as it's far too expensive), this nicety is usually dispensed with.
It's a reasonable assumption that when alleged debts are recycled in this way, the original claimant has concluded that it's not worth suing you. So from that point on, so-called 'debt collection' is simply a numbers game based on threats and bluff.
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.