Even as the economy continues to drop amidst market pressures, many Americans are encountering bigger challenges to their efforts to get the money they need to reduce their debts. With debt loads growing, consumers are receiving more calls from debt collectors seeking payment.
In today’s financial climate, debt collection is experiencing a boom. Back in September, the total amount of consumer debt reached a staggering $2.59 trillion; this marks a $6.9 billion from August.
Recent figures supplied by the debt collection trade association, ACA International, recorded over 1 billion consumer contacts for 2007. This number includes the activities of approximately 5,500 debt collection agencies across the country. More interesting is the consensus that points to an increase in these numbers.
One expert has suggested that the imminent growth of the debt collection industry is based on to a couple of factors. Not only are the current methods being used by collectors are far better than in the past. The process is far more efficient. As a consequence, a secondary market has arisen to trade packaged consumer debts between different firms. The older debts are coming up again as different groups get their hands on them. Another factor is the changes in modern bankruptcy laws, which have made debt far harder to eliminate.
Another element in the explosion of debt collection market is due to the state of credit card companies, mortgage lenders, and other companies, all which are being hindered by the credit crisis. These groups are turning to third-party collectors to recoup older debt losses from consumers.
With so many indicators of an immediate increase, it may be surprising to note that any significant rises in collection activities. At the same time, no one can deny that the country is facing a serious national economic crisis. This will inevitably force many consumers’ overdue debts into collections.
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Debt collection companies do not have the right to collect a debt sold to them by a debtors origianl creditor. A person cannot put himself in harms way and then once he is harmed go and sue for the damage the harm did to him. This is equivalent to a buyer purchings a home that is on fire and then after the sale the new owner sues the old owner for fire damage. If a collection company purchases a debt that has been uncollectable he cannot win a law suit against the debtor to the original creditor because he has no ground to stand on. This reason among others is why we at freedomfromcreditors.com consider a debt owed by a collection company to be uncollectable and one not to be paid.