In the first three parts of this series I wrote about collections accounts, described how sending unpaid accounts out to an agency helps out a creditor, and described the practice of selling an old debt to a third party collection agency. I spoke about the type of information that a collection company will obtain to utilize in their efforts, and the type of laws that third party collection agencies must follow. I described illegal and legal tactics that debt collection agencies use to collect.

I reminded you that most debt collectors realize that it is imperative to collect on your accounts as soon as possible. Many will ask you why you can’t pay today, and many will attempt to manipulate your emotions or insinuate that you are fiscally irresponsible to upset you into agreeing on a payment.

Another strong arm method utilized by collection agents is to upset a consumer by manipulating their emotions, and then transfer them to an agency supervisor. By this time the debtor might be angry or frustrated and it will be more probable that they would agree to something easier simply to get off the phone. If you find yourself in this situation, try to remain calm throughout the conversation.

Keep in mind that you aren’t talking about a mortgage payment; the debt collector can’t take your house away if you can’t make the payments that they are specifically requesting. Don’t let the collection agency manipulate you into agreeing to something that you cannot afford at the moment or intimidate you into doing what you don’t want to do.

Do your best to remain firm and stick to the terms that both parties agreed on. After working out a payment plan, as with ANY financial decision, confirm your agreement in writing by sending a written plan by certified mail, return receipt requested to ensure delivery and proof that the agency received it.

Rapid Recovery Solution does commercial debt collections and writes articles on medical collection companies. Free reprint avaialable from: Collection Agency Basics Part Four: Tactics A Debt Collector Uses And What To Do After You Have Paid.

In today’s recession, collection companies are not exempt. Starting last year, they first started to suffer from declining liquidation performance, staffing cuts, and increased placements.

Then in January 2009, the U.S. savings rate grew and continued to grow. By May 2009 the rate was the highest level of consumer savings in sixteen years.

Generally, an increase in the U.S. savings rate would mean that debtors will be more fiscally responsible and try to pay off debts that they may owe in case of an unexpected bad turn of events. Unfortunately the first half of 2009 has shown us that this is not what is going to happen and the collections industry shouldn’t expect it to.

To make matters worse, the sustainability of savings growth is quite questionable because a portion of the increase was the result of the Obama stimulus package, which sent one time disbursements to consumers. Also, any type of consumer savings may be considered a means to keep heads afloat as opposed to future planning. And although savings boost personal income, they slow down consumer spending.

For the first time, collections agencies need to shift their focus drastically. Its not that consumers won’t pay, it’s that they can’t pay. Therefore, the future success of collection companies is dependent on U.S. economic recovery.

That being said, savvy conclusions can be drawn about the future growth in the collections industry. Better job opportunities would be an amazing gain for the collection industry. If debtors are employed, they are more likely to resolve their issues. Renewed consumer confidence and spending would be a huge boost.

There is an forthcoming tide of pro-consumer adaptions that the collection industry can do little about. How it can truly affect change would be the quality of responses they are giving, and that they are carefully considered and level-headed. Finally, increased access to credit is a necessity for the collections industry.

Mallory Megan works for Rapid Recovery Solution and writes articles on medical collection agencies.

A lawsuit against forestry contractors local to Arrow Lakes, that was filed by an American collection agency has been temporarily put on hold by a Delaware judge. On January 20 a hearing was held in a U.S. court with PricewaterhouseCooper legal counsel attending via telephone conference.

Concerned contractors spoke with the judge who agreed that something should be done. The orders that are being entered didn’t affect any of the Canadian entities, or at least they should not. The case was pretty much put on hold while mediators and lawyers tried to determine the best possible route for the lawsuit.

A spokesperson for the contractors says that she was notified of the lawsuit by mail, like a lot of others in the area. She claims that she has lined up her defense in case the proceedings continue, but she believes that the lawsuit is simply a last-ditch scheme to get cash.

The Minnesota-based legal collection company asked the contractors business, Summit Lake Services for $19,000 for work finished three months before Pope and Talbots collapse. Another local contractor, Reg Gustafson of Cougar Valley Ventures seems to also believe that this is a ploy for money. Indignant about being asked to return $41,000, Gustafson claims that they will have to put him in jail before he pays up. He says that although he took the legal papers very seriously when they were first served, he now has been able to put the situation into context.

He says that he will continue to take it seriously, but he will make a point of saying no. Crystal Larder of Mountain Meadow Contracting has a business that has been asked to repay $49,000. She hasn’t put up any defenses yet, but even if the local contractors were to be tried in court, it must be in Canada.

Mallory Megan works for a debt collection company. She also writes stories on business, finance, consumer spending and collection agencies. Also published at American Collection Company Put On Hold In Legal Battle.