Be the Type of Consumer Who Eliminates Their Credit Card Debt Because Credit Card Debt Collectors Do Not Want to Collect From Them.

Most of those people who cannot afford to pay their monthly minimum credit card payment become potential victims of the consumer debt collection industry. However, a small, but growing number of consumers have found consumer protection laws to protect themselves against credit card debt collectors and a way to eliminate credit card debt.

Depending on how he or she spends it, time is the debt collector’s friend or enemy.  Ideally debt collectors would like to spend their time with consumers who are easy to collect from.  Everyone knows an overdue credit card debt will bring a call or a letter for some debt collector.  What they do not know is with a proper consumer response to that communication, the debt collector will move on to a more likely target.

Over the last 30 years the credit card industry has grown exponentially and the consumer debt collection business has as well.

1. The Federal Reserve and Business Week report $133.7 billion of consumer debt in 1970 increased to $2.5 trillion of consumer debt in November 2007.
2. According to ACA International, a consumer debt collection trade group, each year debt collectors return more than $40 billion to the U.S. economy.
3. According to data from the U.S. Census Bureau, there were 159 million credit cardholders in the United States in 2000, 173 million in 2006.
4. According to the American Banking Associate, 4.75 percent of bank cards were delinquent in the first quarter of 2009.

The point is, there are millions of delinquent credit card accounts to go around to ambitious debt collectors and collection attorneys.

The Federal Reserve requires credit card companies to hold reserves for bad debts. The credit card companies profit from these debts after they are written off by selling them to junk debt buyers for no more than one penny on a dime, or 10 percent of their value.  With that kind of discount, junk debt buyers and their collection agencies and collection attorneys can be quite profitable by only collecting on 30 or 40 percent of the purchased accounts.

Debt collectors can make more money by pursuing delinquent credit card account holders who put up no resistance. Proper resistance to debt collection attempts usually causes debt collectors to look for less resistant targets.  Effective resistance to credit card debt collectors starts with the Fair Debt Collection Practices Act (FDCPA).

The Fair Debt Collection Practices Act covers the behavior of collection agencies, junk debt buyers, and collection attorneys.  The FDCPA treats attorneys as debts collectors, if they are collecting consumer debt.  The consumer must be notified in writing by the debt collector of their right to dispute the debt and have it validated, according to the FDCPA. Copies of original documentation that verifies a debt are considered proper validation by the FDCPA.  The FDCPA gives the consumer the right to tell the debt collector to stop collection activity until they have validated the debt.   Proper wording of these communications is critical, as is how to handle subsequent communications with debt collectors or collection attorneys, according to the Credit Card Debt Survival Guide.

Should the debt collector invest their time with those who properly dispute and request validation or those who put up no resistance?