Payday loan lenders will usually have in house collectors since the term for a loan is on average two weeks long. It doesn't take much time to have a loan in default with direct payday loan lenders. Once the usual 120 days are up for loan collection attempts, the outstanding balance moves on to a collections agency. Your days with dealing with the original payday loan lenders are over, the default debt gets reported to the credit bureaus and you being hearing from a professional collector.
The debt collectors have worse reputations than the payday loan lenders. All it takes is a few bad apples to ruin the whole bunch. Online payday loan lenders are affected by that rot in all the bad reports which call them predators or aggressive lenders. There are some things which you need to understand about collectors. The most important element which gets overlooked during stressful financial times is that these collectors are human beings just like the rest of us.
The collectors have a set of regulations which they must follow in order to collect on the debt. Yes, there are some who overstep their boundaries and do not make best collection practices their daily job. Those are the bad apples of the collection world. There is a larger majority of collectors who do their job as fair as possible. Let's face it; the job of a collector is not a rosy position to have.
The clients who have to contact are usually not on their best behavior due to being in a bad situation. Many have more problems than just financial ones. There are medical, unemployment and death problems which are just a few of the situations which create financial difficulty. The collectors hear sad stories behind the debtor's situation, but their job is still to collect on the debt. The human factor makes it more difficult when the stories haunt them even after clocking out from work. Remember, the collectors are people with feelings too.
As the consumer is protected by threats and abusive tactics of the collector, what protects the collector from receiving threats? For the most part, debt collections is a thankless job. It is about getting money from people who have none or refuse to pay. So when there are death threat messages left on their phones, bomb scares, or threats of hunting family members down in order to get the collector to stop calling. As most people just refuse to answer the phone or hang up when the call comes through, there are bad apples on the other side as well.
How to effectively communicate and work with a debt collector:
*Be polite, they are just doing their job. They are not the cause of your financial difficulty.
*Be honest. Excuses are a plentiful and can get quite absurd. They will listen if you talk truths.
*Work out a plan that you can afford. Their job is to collect money on a debt you owe. They will work with you to make a plan which you can afford.
*Effective communication is key to additional problems. If problems come about, you need to let them know before they create missed payments.
*Answer the calls, be nice and if you really don't want to converse with them, respond in some way. Leave a message after hours or write a letter. There are ways to deal with your debt which can provide you with opportunities to fix your current situation.
Collectors are people who will help you out of bad times. Many will help provide budget guidance to make your situation better. There are debt collectors who receive thank you notes from debtors who worked with them to get out of the financial mess they were in. Direct payday loan lenders have in house collectors who will do the same before it goes to collections. You can choose to work with the one affiliated with the business so your debt does not get reported to the credit bureau or wait till a third party gets involved. Make the best financial decisions possible to protect your future finances.