Home > Managing Debt > True Confessions of Debt Collectors

Comments 10 Comments

Many Americans struggling with managing their debt become frightened to pick up the phone because of debt collectors. You’ve probably heard stories about deceptive debt collectors, and you may even have been a victim of a debt collection scam. But you’ve probably never heard anything about what it’s like to be working in collections.

Learning more about debt collectors and working in collections gives you a valuable perspective of the people who are just trying to do their jobs. As a consumer, this insight can also help you understand your rights when you owe a debt and how to handle debt collection attempts.

Important Facts About Debt Collection

The Federal Trade Commission enforces the Fair Debt Collection Practices Act, which prohibits unfair, deceptive and abusive debt collection practices. Even though debt collectors must follow these rules, debt collection still generates more consumer complaints to the FTC than any other industry. The FTC received 859,090 consumer complaints in 2016 and 608,535 in 2017 that dealt directly with debt collection.

The continual rise in complaints doesn’t mean collectors using a more aggressive method or breaking more laws. Many debt collectors carefully comply with fair debt collection rules and work for collection businesses that follow the standards and laws that tell them when and how they can contact you.

Unpopular Career Choice

Becoming a debt collector isn’t exactly a popular career choice. Debt collectors get used to negative reactions from people when they tell them what they do for a living.

“People cringe when you tell them what you do,” says Michelle Dunn, a debt collector and author of Dealing with Aggressive Debt Collectors: What to Do and How to Do It by an Industry Insider. “A lot of times you don’t want to tell them what you do. They’re only dealing with debt collectors when they’re in a bad situation.”

While most of the debt collectors and collection companies Kerri Fivecoat worked with while in the industry for more than a decade would try to take a calm and compassionate approach with debtors, she says there were a few exceptions who put the industry in a negative light.

“There are people who enjoy debt collection,” Fivecoat says. “They would really get into what they were doing, and they didn’t have the personality to start out being nice with people. They were more forceful or more assertive, and sometimes it was effective.”

Bryan Franzoi has spent more than 15 years in debt collection and even though he has worked with some bad collectors, he says the stigma about debt collectors is incorrect. “Ninety-nine times out of 100, there’s a totally wrong misconception,” Franzoi says. “They’re really just trying to put you in a better financial situation.”

“Most people who are bill collectors don’t take happiness in yelling at people,” says Dunn. “They don’t get into this business because they want to be mean to people.”

Fivecoat says she was normally a top performer at her company just by listening to the people on the phone and trying to come up with solutions. “If you’re faced with a debt collector who is aggressive,” explains Fivecoat, “the best path to take is to ask to speak with someone else.” She employed this strategy herself when she and her husband were in a tight financial spot and were receiving collection calls of their own.

“As collectors, we trade off people if someone isn’t able to make headway with them,” Fivecoat says. “There’s always someone they can transfer you to.”

Do Debt Collectors Make Good Money?

Debt collectors can earn good money depending on their experience and success in the field. The state you work in often impacts how much you earn as a debt collector even more. For example, collectors in the District of Columbia earned an annual income of $63,570 and $46,470 in Connecticut, but those in Arkansas only earned $31,660. No matter the earning potential, bill collectors ranked #27 in Best Business Jobs by U.S. News in 2019.

What Is the Average Salary of a Debt Collector?

The average salary of a debt collector was $13.79 per hour or $37,041 annually in August of 2019. This salary could be higher in some positions, if the company offers bonuses and/or commissions on the accounts you’re able to collect on. Some companies also offer profit sharing, especially collection companies collecting for another company that rewards their top performers.

How to Act When Debt Collectors Call

When you’re struggling financially and falling behind on your bills, debt collectors may begin calling you. There are numerous things debt collectors won’t tell you, but some of the best advice many collectors give consumers is to stay in touch.

“The worst thing you can do is ignore the calls,” Dunn says. “Send a letter. At least respond in some way. Wait until the company closes and call, if you want to avoid the conflict. By ignoring it, the account gets escalated to legal quicker, and you’ll get calls more often and even letters.”

“Honesty is also a key component of communicating with debt collectors,” explains Franzoi. “A lot of consumers run and hide and not answer the phone, and then we have to hunt them down. If someone answers the phone and is honest with us, we can normally find a solution.”

Several debt collectors agree that consumers often think they must pay the full bill or nothing at all, which is often a costly mistake. Debt collectors like to use payment plans as a tool to get consumers to start paying the debt, even if it’s only a little bit at a time. Dunn previously setup payment plans for people for as little as $5 or $25 a month because it let her get them to commit to paying something and keep communication lines open.

“If a debtor is receptive to it, I can take them through their monthly bills and try to get them in better financial shape,” Franzoi says. “The last thing your bank wants to do is charge off your account or foreclose on your house.”

It’s Emotional on Both Sides

When you’re trying to get out of debt, it’s often very emotional for you and the debt collector. It’s not just overspending or lavish lifestyles that could lead debt collectors to your door. Circumstances like an illness or unemployment often leads people into debt, which makes the situation even more emotional.

“When somebody’s in debt and they have bill collectors calling them, that’s not their only problem. They normally have something else going on,” Dunn says. “The last thing you need is a bill collector calling you. It’s common for people to lash out.”

In Dunn’s case, she’s even received death threats in her career as a debt collector. Although she says it’s hard not to take consumers’ threats personally, the key is trying to understand the position the debtors are in.

“I’ve also received thank you cards from debtors,” says Dunn. “If they owe you money, most of the time they owe other people money, too. I just treated them differently.”

“Emotional stories from people we call makes debt collection a tough career path,” says Franzoi. “The housing crash of 2008 and 2009 was especially tough. You’re a human being, you’re going to be affected by it. There have been times where it has been very upsetting to me, and I even had an employee break down and start crying when I was working as a manager of debt collectors.”

How Can You Improve Your Debt Collection Skills?

If you’re a debt collector, you can improve your debt collection skills by tapping into your ability to communicate. Be prepared by learning all you can about an account you’re attempting to collect, keep information well organized and document everything. Always act professionally by avoiding confrontation, manipulation, getting angry or harassing the consumer. Provide an incentive to pay, recap any terms that were agreed upon and keep the lines of communication open by following up.

How Do You Succeed in Collections?

To be successful in a debt collection career, you must be able to reign in your temper when consumers lash out at you. Maintaining a calm demeanor in stressful situations helps keep the people you contact calm as well. Good listening skills are also pivotal to success. When you pay attention to a consumer’s concerns and learn how they fell into debt, you’re better prepared to offer a viable solution and negotiate the best repayment terms for the debtor and the creditor.

If your debt goes into collection, you must know your rights. Collect information to validate the debt, including checking your credit report each year and monitoring your credit score for free at Credit.com to watch for suspicious activity or inquiries. Never forget that you have options for taking care of a debt, including paying it in full, arranging a repayment plan and negotiating to get the debt reduced.

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • ohrly

    Um change your phone numbers.

  • Pingback: Canadian household debt on the rise: report - Get Out of Debt - Debt Advice()

  • http://Josephmas.com Joseph Mas

    At the beginning of the article you mention “yhe aftermath of the recession. Are you sure it’s over? I think collections in certain areas will continue to climb such as in housing etc. i just love your articles. Collectors as well as attorneys have a struggle on their hands with reputation in the public eye. It only takes one bad apple as the saying goes.

    Joe
    iPhone

    • Kali Geldis

      Hi Joe – Thanks for appreciating the article! The recession technically ended in June 2009 when the GDP began to grow again. However, a lot of Americans are definitely still feeling the Great Recession because of higher unemployment rates, something that shouldn’t be ignored! Making a better definition of a “recession” is tricky, but a great discussion topic for our forums! (Forum.credit.com)

      Thanks for commenting!

  • Pingback: When Debt Collectors Go After American War Heroes | Credit.com News + Advice()

  • Pingback: When Debt Collectors Go After American War Heroes | ComparePlastic()

  • Pingback: When Debt Collectors Go After Vets - Military News | Military News()

  • Pingback: When Debt Collectors Go After Vets | DEBT RELIEF NEWS()

  • Nomad Nomlaki

    I had ordeal with Ford Motor Credit debt collectors. I missed one payment and the hell began. I withheld payment due to a lemon car. I went to civil court and Ford motor credit never showed. I had recorded deep voiced debt collector telling me was coming to my home “to take care of the matters personally.” I also had article out of Fortune 500 about Ford Motor Credit having maffia debt collectors who were responsible for three deaths in southern California. Judge ruled in my favor. But the collection effort still went on. Especially after Ford Motor credit sold debt to other debt collecting agencies/attornies.

  • Debt Collector Brisbane

    Great article and debt collectors are associated with all sorts of bad fact this article eliminate the wrong facts about the debt collectors.

  • Pingback: Debt Collectors Killing Your Credit? Here's What To Do | Credit.com News + Advice()

  • Pingback: Is Your Cellphone Ruining Your Credit? « Jeanne Kelly Credit Coach()

  • Pingback: 11 Ways a Debt Collector May Be Breaking the Law | DEBT RELIEF NEWS()

  • simogene

    Unfortunately I’ve had a lot of contact with debt collectors after my daughter and husband were hospitalized last year. Our health insurance isn’t that helpful, and we couldn’t cover the deductibles all at once. Every one of the collectors I’ve dealt with has been very nice. I have yet to run into one that is not polite and helpful. As for the people that the hospital business offices, they are quite pushy. One of them actually said to me “Well have you filed your taxes yet? Maybe you can use your refund to pay this off?” Honestly, thanks for assuming I’m getting a refund! The hospital business offices also refuse to make payment plans for small increments, and they always want hundreds of dollars at a time. (I’ve had dealings with three different hospitals, an ambulance company, two specialist’ offices and three different doctor’s offices. Only one of the specialists and one doctor’s office was not like that.) So I stopped talking to them. I started telling them, “Send me to collections.” At least they’ll set up a plan for an amount we can actually pay in a month!

  • KT

    I had to quit working due to my daughter being born with alot of medical issues. I have like 4000.00 out of pocket to pay so I worked on the smaller amounts to get them paid off and just paid what I could to the bigger ones until I had the small ones paid and could do more on the big ones. I was getting hateful calls every month from one of the companys although I was sending them money, not what they wanted but something. I never made an arrangement with them because they didn’t want to work with me after I told them the situation and they still sent my account to collections. I still pay my payment on their website and they sure do accept it every month! I didn’t think you could be turned over to collections as long as you were paying something towards your debt.

    • Credit.com

      KT — unfortunately, collectors don’t have to agree to payment terms, and even if you’re paying a little each month, they can still turn it over to collections. It happens quite frequently with hospital bills. Here’s a recent article that addresses another readers situation that is very similar to yours:

      When A Debt Collector Demands Payment In Full

      It offers a few words of wisdom that might help you avoid what happened to him. Hope you find it helpful.

  • Andy

    I once had a collection agency that didn’t even coordinate in-house what they’d set up with me. I got two calls from two different collectors on two different days. I’d set up a payment plan with the first and didn’t bother calling the second back. About two days later, I got two letters from the agency. One was a letter confirming the payment plan and the other was a threat of legal action. About a month later, I had the funds and paid the damned thing off in full.

  • reverendflash

    In the article, we hear of a debtor who left a ‘scary’ message for a collector saying that he was a “straight shooter”.
    Am I the only one who understands that a ‘straight shooter’ is more often intended to mean ‘someone who tells it like it is’ versus ‘an excellent marksman’?

Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.



Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team