Posted on 03/05/2003 10:09:56 AM PST by Willie Green
For education and discussion only. Not for commercial use.
The more the bill collector called, the more rattled Patrick McGlinchey, 51, became.
Unemployed for the first time in 35 years, McGlinchey had never experienced being hounded for money. In a job that brought in $70,000 a year, the former facilities manager from Coatesville never had a problem keeping up with his bills.
Angered by one bill collector's attitude, McGlinchey tried to get the collector's name and address to complain. But every time he tried, the collector would hang up.
McGlinchey found a sympathetic audience for his plight at last week's meeting of Joseph's People, a support group for the unemployed at St. Joseph's Roman Catholic Church in Downingtown. Many had their own horror stories to tell.
Besides the psychological battering that comes from losing a job, McGlinchey and the others face the embarrassment and anxiety of not being able to keep up with the bills and the humiliation of being harassed by overly aggressive collectors.
"Debt collectors are growing more outrageous in their collection efforts," Exton lawyer John Ralston Woodruff told the group. "We're seeing this as an epidemic."
"They will tell you they'll put you in jail. Well, there hasn't been a debtors' prison since 1850. You can't go to jail for being in debt," he said.
Woodruff continued, "They will tell you they'll call your friends, your family, your boss. They say they'll call you every day for a month."
Of course, people must pay their bills, but that doesn't mean they need to be subjected to humiliating harassment in the process, he said. Federal and state credit-collection laws limit the number of times collectors may call, and forbid most contacts with relatives and friends.
McGlinchey lost his job in November, but many of the 50 people gathered in St. Joseph's parish hall had been out of work for more than a year.
And once creditors learn about the unemployment, some can become even more fierce, Woodruff said.
"They love to hear someone who is very upset, then they love to come along and push the buttons," he said. Collectors reason that a stressed-out debtor will be more likely to pay up just to end the aggravation.
Like many other support groups for the unemployed, Joseph's People helps with job-search skills, with an emphasis on propping up the fragile spirits of those who have lost their work and their confidence.
Joseph's People also provides tips for coping with a new financially stressed lifestyle.
That's why Woodruff was invited to be a speaker at the group's meeting last Tuesday. His law office, Bazil & Associates, started building up a practice in representing consumers in collection issues after one of the partners started getting hounded for a $100 bill that had been paid two years earlier.
Woodruff, of course, said he wouldn't mind getting clients from the group, but would charge only expenses and not an hourly fee unless he won a judgment from the collector.
The law also permits plaintiffs' attorneys to collect their fees from creditors.
After McGlinchey lost his job, he could not keep up the payments on his college-age daughter's credit card. She went into default, and one of her creditors started hounding him for information on how to reach her. One time, a collector called pretending to be her friend. Another time, a collector - same voice - called pretending to be a lawyer. A third time, the collector said he was a representative from the daughter's student-loan lender.
Such tactics violate federal laws, Woodruff said.
"I was really upset," McGlinchey said. "I couldn't sleep for a whole night."
Patricia Warren of Phoenixville, laid off from a Chester County government job, said that, when she had lost a different job several years ago, she began to receive threatening letters about her student loan.
One even included a photo of a man holding a gun. "He had a rifle, and he looked like a really bad dude," she said, only half-laughing. She said she wanted to send her payment in with a photograph of her holding her hands up in surrender.
An unemployed commercial real estate agent from East Goshen Township, who asked that his name not be used because he is embarrassed about his financial woes, said one creditor started screaming and yelling "to the point of profanity. I asked for the supervisor, and the supervisor got on the line and said: 'What do you want, deadbeat?' "
Woodruff said one of his clients received a bill from a collector that included a photograph of the client's front door. No threats were made, "but the message was clear," Woodruff said.
He said said people in debt might be so psychologically beaten down that, when they get abused by collection agents, they think: "I know I owe them money, so I have to put up with whatever they are doing."
But he said there were remedies, and part of it comes from understanding how debt collection works.
Some companies might have their own debt collection departments or hire an agency to collect the debts.
Other companies don't want to go through the time or trouble of collecting. They sell their list of debtors and the right to collect to another company, often accepting less than the full amount owed in return for quick payment.
The companies that buy the debt have made the calculation that they can collect more than they spent to buy the debt, minus collection costs. So there can be room for bargaining.
Or the original creditor might have an interest in preserving a business relationship with the debtor and might be willing to work something out. For example, the company that financed McGlinchey's automobile told him he could skip two payments, pay the third, skip two more payments and pay the sixth - adding the missed payments on to the end of the loan.
"That was pretty good," said McGlinchey, who has managed to keep up his mortgage payments. "It bought me six months. I hope something turns up by then."
Even collectors who sound friendly might be probing for details about why the bills aren't being paid or where spouses, friends or family work - all information they might try to leverage in collecting the bill.
No one should be bullied into paying anything without proper documentation, Woodruff said. That means knowing the name and address of the original creditor (such as the original credit card company), the name and address of the current owner of the debt, the exact amount owed along with interest and fees, as well as the last date a payment was made.
Woodruff told the group members they should insist on seeing all the proper paperwork before they pay anything, and they should vigorously dispute anything they disagree with in writing, being careful to keep copies.
It also helps to keep a phone log tracking the time, date and frequency of calls, along with notes about conversations.
When negotiating a settlement, make sure the person on the phone has the authority to come to an agreement, and then get the agreement in writing, he said.
"A lot of people will try to work with their creditors, but the danger you face there is that you could work out an arrangement with Chase Bank, for example, but the actual debt is with a collection agency and the agency has no idea" about the arrangement with Chase.
Contact staff writer Jane M. Von Bergen at 215-854-2769 or jvonbergen@phillynews.com.
Hate to call him out on this one, but why isn't the daughter making some payments on her own credit-card? I understand that a 70k job may not be around the corner for this guy, but surely the daughter could be of a little less burden here.
A stressed-out debtor may just go for his gun also.
Push too far and even an ant will push back.
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