If for whatever reason you want to negotiate a settlement, here is how to do it on your own. Once again, do not use a debt settlement company in Canada.
Generally remember this: you are in a contract dispute, or trying to settle a debt, they are your adversary. They aren't on your side, and privacy laws protect you from sharing any information that you don't chose to. Helping them "get" you is their trick. If you were fighting a speeding ticket, would you call the prosecutor and tell them that you were speeding on this date at this time? Of course not. Do not help the company you are in a dispute with. It seems like common sense, but the biggest mistake people make is volunteering all of the information the evil company needs to make you pay them. I'll reiterate now that if you ignore them, they won't have any idea what your case, or their case actually is, and they will drop it.
Also remember, they aren't the police, or a court. They will lie to you and tell you that you have no choice and that they will ruin your life. If they can lie to collect their debt, then you can lie to negotiate a better settlement. Remember, YOU HAVE ALL THE CARDS. If you do nothing, they will get $0, so any amount more than $0 is a win for them. They usually set a floor settlement of 25%. Anything less than that and they would rather take the tax write off by cancelling your debt, so 25% is your goal. If they won't accept that, then you're good because then you pay 0, which is what I've been advising all along. Anyway, here is how it works if that's the way you want to go.
Step 1: The Bank or Utility
As soon as you're about 60 days late on your payments, the bank or utility will start calling you. They are usually somewhat friendly, and don't want to be the "bad guy". They hire collections companies to do that to protect their reputation. These phone calls are to investigate your ability to repay. During this call you can either make yourself look like someone worth chasing, or someone they'll have to write off. You want to be the latter. Remember, privacy laws protect you, all your creditor will know is what you tell them.
What they want to hear, so they can sue you:
That you're employed in a salaried position (possible wage garnishment)
That you have assets (you won't declare bankruptcy)
That you own your house (they can put a lien on it)
What they don't want to hear, you're not worth chasing
Nothing. If you don't return their calls, they're working in the dark.
That you're unemployed
That you have a lot of other debts in addition to theirs (you're likely to declare bankruptcy and they'll get nothing regardless)
2. The Collection Agency
Pre-negotiation
After the bank has collected your information, or you have ignored their calls for a few weeks, they're ready to send the file to their enforcers: the collection agency. CIBC, for example, doesn't want to go on record calling a worthless deadbeat and telling you that you are scum and they will destroy your life if you don't pay them, so instead they hire some goons to do it. Once again, I recommend ignoring them till they go away, which they will, but if you really want a settlement, repeat what you told the bank. Tell them you're unemployed and have no money. They'll start at 100%. Be clear: I have no ability to repay even $50, let alone the full-balance. At this point they will start calling you names and belittling you. They'll ask you to get money from your parents or friends or whoever (what a bunch of bastards these collection agents are). Tell them you have already asked, and obviously no one is going to give you money to pay off your debts. Their strategy (because they aren't allowed to harass you, is to get you to agree to something. Anything. They need a new reason to call you back, calling you back for the same reason is harassment. They say something like "Okay, well why don't you make some phone calls to your friends and family and Ill follow up with you tomorrow?". If you agree, you given them a fair reason to call you back. Remember, your goal is 25%. When they call the next day, say you have 2%. Then 3%. Make it look hopeless.
Threats
At this point, they'll start threatening you. The first one is usually "well, this is your last chance. I dont want to do this, but if I can't get something worked out today I'm going to have to escalate this to our legal department." They all say this, and it isn't true. It's hilarious how standard this trick is. Sometimes they'll even mail you court papers. So sneaky. Look at the top corner of the document where the court seal should be. It isn't there. They're trying to deceive and scare you. Sometimes they will call you and say, "I'm the lawyer representing XYZ Collections." This is always a lie, they never have in house lawyers simply because a lawyer earns money, they went to law school so they wouldn't have to work in a collection agency call center with a bunch of idiots who didn't graduate from high school. A lawyer bills hundreds of dollars per hour, just them working on your file for 8 hours would negate the point of them chasing you in the first place: to recover money. Lawyers are just too expensive, high school drop outs in a call center so unskilled and desperate for a job that they will do this for a living are not expensive. Next they'll move on to progressively more severe threats. These days they're usually more careful with their wording than they used to be. 10 years a go they'd say "I'm to to take your house" which is illegal, especially because they have no ability to do that, but now the say things like "We're looking at your house" "We're going to look at your bank accounts and assets". It's all BS. The fact of the matter is they are terrified that they will get $0, because unless you give them more than that, they're screwed. They have no way to get your money unless you give it to them.
Settlement:
After a few weeks they'll keep telling you all the time, "We need to fix this now before it goes to our legal department" which it never will. Make them wait days before moving up in 1% increments. When you get to 5% of the total debt, stop. Say you've called everyone you can think of and its 5% or you're going to have to declare bankruptcy. This the worst thing they can imagine, since it will release you from all obligation immediately. At this point, they will tell you that you can't, that your debt won't be covered under bankruptcy laws (lie) or that you don't want to do that. I have a collection agent tell me once that "You can't just declare bankruptcy, if you could than everyone would do it." Everyone does do it. There were 89,332 bankruptcies in Canada in 2011. Screw you collections agent. Anyone can declare bankruptcy at anytime. The threat of bankruptcy is the collection agent's worst fear, and they'll use a variety of tactics to pretend that that isn't an option for you. It is. Anyway, once you've said 5% leave it there. When they call back tell them you have no other options and that if they'll accept 5% you'll move forward, if not there is nothing more to talk about. If they call back again, tell them you've noted the date and time, that you have done everything you can, and unless they are willing to accept your offer to stop calling, you won't be harassed. As for their mailing address suitable for receiving registered mail. At this point they should offer you their lowest settlement amount. Tell them to send it to you in writing, and you'll see what you can do. At this point you can either accept it, and put this behind you, or do nothing and pay nothing. If you do nothing and pay nothing, they'll give up and 6 months later you'll get calls from another agency. This one will be far less persistent because they know both the bank and another agency have failed. Repeat the above process. After two years your debt is no longer legally enforceable. If you get anymore phone calls at this point, just say I dispute it entirely, you'll have to sue me. They don't even have that option anymore so it's fun to call their bluff.
Wednesday, June 6, 2012
7. Bankruptcy Alternatives: Parasites in Sheep's Clothing
There are a lot of parasites in sheep's clothing operating these days. They're mostly ex-collection agents who are still scum, but have decided to go about it another way. Here's how it works:
1. Settlement
A collection agency usually expects that you will settle for some amount. After they have successfully brainwashed you into thinking you're a bad person and that the billion dollar predatory lender they represent is the victim, they'll try and get blood from a stone. They'll start at 100% and work their way back, getting you to disclose all sorts of information (your employment situation, your wage, your assets) to them that you should never tell anyone, let alone tell an evil collection agency that represents your adversary in this contract dispute, all of which they will use against you. After they evaluate your financial situation, they'll put pressure on you to ask your family and friends for money, because the bank/Rogers needs money more than your grandparents, they think. Usually, they've bought your debt from the bank for about .25 on the dollar, which means anything over that they keep. So say, you owe $100,000, they bought it for $25,000 and will try to get an amount over that from you.
2. Debt Settlement Companies in Canada are Almost as Bad
This is where settlement companies come in. 99% of the time these companies are run by ex-collection agents who could no longer stomach themselves. Now the deal is that they will "represent you" by getting the collection agencies to settle. Here's the thing though, you don't need to settle, and if for some reason you want to, you don't need them. See the next section "How to Negotiate a Settlement on your Own". These "wolves in sheep's clothing" are essentially just friendlier collections agents. They'll tell you "Okay, you owe $100,000. What if I could get that down to $35,000?" It sounds like a good deal, but 1. you don't need to pay anything 2. The collection agent is making $10,000 off of you 3. (the worst part) is that these scumbags actually CHARGE you 50% of what they've "saved" you!!! Is in this example, you need to pay these bastards $32,500! They might be worse than a collection agent. Do not use debt settlement companies in Canada, they are a total scam. The worst part is that even if you do want to settle for some reason, you can settle for the exact same amount by dealing with the collection agency directly. Why you would ever do that is beyond me, but if you do decide that is the best course of action for god sake don't use a debt settlement company.
3. Canadian Credit Counselors
These guys are okay, but also not worthwhile. Their deal is that they stop the interest, and have you repay the FULL principle amount over a fixed period of time. Say 5 years. Your credit is already ruined at this point so it won't save your credit, in fact it will prolong the damage. See the section on credit bureaus for more information. Basically, 6 years after you stopped making payments the account that you defaulted on will disappear from your credit bureau. If you decide to make payments through credit counseling, it will show on your bureau for the 5 years you take to repay the debt, plus 6 years after that, so 11 years total. A settlement will disapear after 6 years, or the original debt will disappear after 6 years as well, so I don't see an advantage.
4. Consumer Proposal
This is probably the best route to go if you aren't just going to ignore it till it goes away. You'll need a bankruptcy trustee, and generally speaking they'll do what the debt settlement company would charge you tens of thousands of dollars to do, but they do it for "free". They're licensed by the government and will include their fee in your settlement. Do not use a debt settlement company under any circumstance. If you MUST settle, either do it yourself or use a Canadian bankruptcy trustee.
1. Settlement
A collection agency usually expects that you will settle for some amount. After they have successfully brainwashed you into thinking you're a bad person and that the billion dollar predatory lender they represent is the victim, they'll try and get blood from a stone. They'll start at 100% and work their way back, getting you to disclose all sorts of information (your employment situation, your wage, your assets) to them that you should never tell anyone, let alone tell an evil collection agency that represents your adversary in this contract dispute, all of which they will use against you. After they evaluate your financial situation, they'll put pressure on you to ask your family and friends for money, because the bank/Rogers needs money more than your grandparents, they think. Usually, they've bought your debt from the bank for about .25 on the dollar, which means anything over that they keep. So say, you owe $100,000, they bought it for $25,000 and will try to get an amount over that from you.
2. Debt Settlement Companies in Canada are Almost as Bad
This is where settlement companies come in. 99% of the time these companies are run by ex-collection agents who could no longer stomach themselves. Now the deal is that they will "represent you" by getting the collection agencies to settle. Here's the thing though, you don't need to settle, and if for some reason you want to, you don't need them. See the next section "How to Negotiate a Settlement on your Own". These "wolves in sheep's clothing" are essentially just friendlier collections agents. They'll tell you "Okay, you owe $100,000. What if I could get that down to $35,000?" It sounds like a good deal, but 1. you don't need to pay anything 2. The collection agent is making $10,000 off of you 3. (the worst part) is that these scumbags actually CHARGE you 50% of what they've "saved" you!!! Is in this example, you need to pay these bastards $32,500! They might be worse than a collection agent. Do not use debt settlement companies in Canada, they are a total scam. The worst part is that even if you do want to settle for some reason, you can settle for the exact same amount by dealing with the collection agency directly. Why you would ever do that is beyond me, but if you do decide that is the best course of action for god sake don't use a debt settlement company.
3. Canadian Credit Counselors
These guys are okay, but also not worthwhile. Their deal is that they stop the interest, and have you repay the FULL principle amount over a fixed period of time. Say 5 years. Your credit is already ruined at this point so it won't save your credit, in fact it will prolong the damage. See the section on credit bureaus for more information. Basically, 6 years after you stopped making payments the account that you defaulted on will disappear from your credit bureau. If you decide to make payments through credit counseling, it will show on your bureau for the 5 years you take to repay the debt, plus 6 years after that, so 11 years total. A settlement will disapear after 6 years, or the original debt will disappear after 6 years as well, so I don't see an advantage.
4. Consumer Proposal
This is probably the best route to go if you aren't just going to ignore it till it goes away. You'll need a bankruptcy trustee, and generally speaking they'll do what the debt settlement company would charge you tens of thousands of dollars to do, but they do it for "free". They're licensed by the government and will include their fee in your settlement. Do not use a debt settlement company under any circumstance. If you MUST settle, either do it yourself or use a Canadian bankruptcy trustee.
Tuesday, June 5, 2012
6. Bankruptcy in Canada
There are a few times in which bankruptcy may be necessary, in which case thank god for it. Bankruptcy is a second chance that the law afford Canadians so that no one lives in financial slavery. The law protects you from creditors and is a legal nuclear bomb. Say John Smith owes $100,000 because predatory lenders have attempted to enslave him with high interest rates and credit limits, if it weren't for bankruptcy protection, John Smith would work the rest of his life with no ability to eascape is debt. Here are some circumstances when bankruptcy may be necessary.
1. You're misinformed.
You've been talking to credit card companies and collection agents. You've fallen victim to their lies and abuse and have been convinced that you will never escape their phone calls and harassment. Although this is not the case (read the rest of this blog) you may decide to declare bankruptcy to end the harassment. You should never declare bankruptcy in Canada over credit card debt, simply because it is not enforceable and therefore a bankruptcy is not necessary. Once again, if you follow the tips in this blog, you'll be fine and escape relatively unscathed.
2. You're being sued
This WILL not happen, especially if you follow the advice here, but probably regardless. That said, you may be sued over a contact if its by a business partner or someone who isn't a multi-billion dollar company like TD, Scotiabank, BMO, CIBC or VISA/ Mastercard. Big companies write off unsecured debts without bothering with a law suit (because they know you'll declare bankrupsy if they win)
3. The CRA (Canada Revenue Agency)
The CRA can collect their debts without use of the courts, and whenever they please. Your debt to them never becomes unenforceable, so bankruptcy if often the your only option if your debt is too large for you to pay. Their fees and interest are ridiculous, but are that way because they want people to pay their taxes. We get a lot of amazing services in Canada, so they are one creditor that is usually right. They can be total jerks too, but taxes are a condition of living here, they can't kick you out, nor will they ask for anything if you're unemployed, but if you're earning money you have to pay your share just like everyone else
1. You're misinformed.
You've been talking to credit card companies and collection agents. You've fallen victim to their lies and abuse and have been convinced that you will never escape their phone calls and harassment. Although this is not the case (read the rest of this blog) you may decide to declare bankruptcy to end the harassment. You should never declare bankruptcy in Canada over credit card debt, simply because it is not enforceable and therefore a bankruptcy is not necessary. Once again, if you follow the tips in this blog, you'll be fine and escape relatively unscathed.
2. You're being sued
This WILL not happen, especially if you follow the advice here, but probably regardless. That said, you may be sued over a contact if its by a business partner or someone who isn't a multi-billion dollar company like TD, Scotiabank, BMO, CIBC or VISA/ Mastercard. Big companies write off unsecured debts without bothering with a law suit (because they know you'll declare bankrupsy if they win)
3. The CRA (Canada Revenue Agency)
The CRA can collect their debts without use of the courts, and whenever they please. Your debt to them never becomes unenforceable, so bankruptcy if often the your only option if your debt is too large for you to pay. Their fees and interest are ridiculous, but are that way because they want people to pay their taxes. We get a lot of amazing services in Canada, so they are one creditor that is usually right. They can be total jerks too, but taxes are a condition of living here, they can't kick you out, nor will they ask for anything if you're unemployed, but if you're earning money you have to pay your share just like everyone else
5. The Law and Unsecured Debt
If you're being harassed for basically anything, be it a lease, a rent payment, a credit card (visa or mastercard) or utility, ANYTHING, what you have is basically a contract dispute. Under the law, it looks like this:
1. Rogers/Visa/Fitness Club has a contract with John Smith. John Smith agrees to borrow money/use a service at this price"
2. John Smith is in violation of his contract by not making payments
Contracts are disputed and broken all the time. The thing with a contract though, is that there is no way for it to enforce itself outside of the service agreement you've entered into. So, yes, Visa can close your account for being in violation of your contract, but it can't take payment from your account, or garnish your wages, or do anything at all. Their "opinion" on their contract is as valid as yours under the law, the the only person who can say who is right or wrong is a judge. Not a lawyer, and certainly not a collection agency. If you don't want to pay your bill because you think your contract was unfair, or because you think a martian told you that it's invalid under inter-galactic law, that's your opinion and you are legal entitled to it.
3. If you want to enforce a contract, you must take it to court and have a judge decide who is right and who is wrong. This WILL NOT happen. After 10 years in financial services, I have seen over 10,000 Canadian's credit reports, which list judgements. THE ONLY TIME I've seen a judgement is for 1. Alimony and Child Support or a legal fine for breaking a "real" law, like burning down someones house. Credit cards and utilities DO NOT sue, because when they do, and the debtor loses, the debtor declares bankruptcy 99% of the time, debt is erased, and the credit card company is out both the balance owing and their legal fees. The will NOT sue you. They WILL threaten to, but they WILL NOT do it.
Finally, all financial obligations become unenforceable after two years. That means that if a credit card like VISA or Mastercard wants to sue you, which they will not do, they lose their ability to after two years. You have no realistic chance of being sued for the first two years, but if it has been two years since you've made a payment, you're really in a good position because they cannot enforce it UNLESS you open the door by admitting (in writing) that you owe it, or by sending them a payment. Obviously, do not do either of those things.
1. Rogers/Visa/Fitness Club has a contract with John Smith. John Smith agrees to borrow money/use a service at this price"
2. John Smith is in violation of his contract by not making payments
Contracts are disputed and broken all the time. The thing with a contract though, is that there is no way for it to enforce itself outside of the service agreement you've entered into. So, yes, Visa can close your account for being in violation of your contract, but it can't take payment from your account, or garnish your wages, or do anything at all. Their "opinion" on their contract is as valid as yours under the law, the the only person who can say who is right or wrong is a judge. Not a lawyer, and certainly not a collection agency. If you don't want to pay your bill because you think your contract was unfair, or because you think a martian told you that it's invalid under inter-galactic law, that's your opinion and you are legal entitled to it.
3. If you want to enforce a contract, you must take it to court and have a judge decide who is right and who is wrong. This WILL NOT happen. After 10 years in financial services, I have seen over 10,000 Canadian's credit reports, which list judgements. THE ONLY TIME I've seen a judgement is for 1. Alimony and Child Support or a legal fine for breaking a "real" law, like burning down someones house. Credit cards and utilities DO NOT sue, because when they do, and the debtor loses, the debtor declares bankruptcy 99% of the time, debt is erased, and the credit card company is out both the balance owing and their legal fees. The will NOT sue you. They WILL threaten to, but they WILL NOT do it.
Finally, all financial obligations become unenforceable after two years. That means that if a credit card like VISA or Mastercard wants to sue you, which they will not do, they lose their ability to after two years. You have no realistic chance of being sued for the first two years, but if it has been two years since you've made a payment, you're really in a good position because they cannot enforce it UNLESS you open the door by admitting (in writing) that you owe it, or by sending them a payment. Obviously, do not do either of those things.
4. Collection Agency Strategies
They use advanced psychological techniques on you because the law is on your side, not theirs. Here is how to deal with their harassing phone calls by playing your cards right.
Section One: If you don't want to talk to them, ignore them and they WILL go away, if you play your cards right.
1. You Are Under No Obligation to Talk to Them.
They'd like you to think you are, but you are not. They want to get you on the phone, like an abusive spouse, so they can use words to poison your mind and soul. Also like an abusive spouse, this is their only weapon, and they need your co-operation to use it. Fortunately, under the law, there is one circumstance in which you MUST talk to someone, and that is if you are subpoenaed to a court of law. "You've been served". This happens in high level court cases. Unless you've been served papers requiring you to appear in a court of law, you don't have to talk to anyone, ever. So, don't talk to them.
2. Change your Voicemail
They will want to leave their toxic threats and intimidation on your voiemail if you dont' answer, but they are bound by privacy laws so can't disclose your debts to anyone. So, say your voice mail is general. "This is the general, non-confidential voice mailbox or John Smith, this mailbox is private and may be checked by a family member or co-worker in my absence. No personal information please. Thanks!" This will limit their voicemails to something discreet like "This ABC company alling about an important business matter. Please return my call ASAP." If your voicemail says it is secure, you give them permsission record terrible, soul disturbing lies and threats.
3. Ignore them
Don't answer numbers you don't know, if they leave a voicemail and its a collection agency, add them to your phone book and assign a silent ring tone. If they can only leave general voicemails asking for return calls, they give up in less than a month. It's not a great month, but it's better than having your sol vomited on and declaring bankruptcy to stop their calls.
4. Change your number. They can't call you if they dont have your number, and privacy laws make it very hard for them to find it. They usually give up.
Section Two: Be pro-active.
1. Answer the call, ask them to identify themselves. As them for your the account details they are calling about. Have them identify their name and mailing address suitable for recieving registered mail (which all corporations must legal have and disclose). When that is all done, say "I have already spoken to Rogers/CIBC/Bell/Goodlife about this account. I do not owe this money and have no intention of paying it. I will be sending you a registered letter to that affect. Do not call again"
2. Mail them a registered letter, keep a copy for yourself. Include your full name, the account number, and address it to the collection agency. Say in the letter: Attention ABC Collections: You are hereby notified I do not owe this money and have no intention of paying it. Do not call again or attempt to contact me again." They are not allowed to harass you, and will not contact you again. You must actually mail the letter, or they will call you again to harass you because you didn't do what you said. You must mail it by registered mail in order to prove that you sent it, they will lie and say they never received anything if you cannot prove you sent it.
3. DO NOT
Admit the debt under any circumstance. This will give them permission to follow up with you on payment terms. They still can;t make you pay, but will call you. DO NOT ever send money. There is a statute of limitations that says after two years of non-payment they can't even choose to sue you, which they wont do anyway, but after two years it's impossible. If you do pay $1, you reset that two year countdown to day one again. DO NOT allow them to talk to you. After you have informed them on the phone of your position, hang up. They are advanced manipulators, don't give them the chance to harass and lie to you. They will win you over if you give them the chance, so don't! They won't call back.
Section One: If you don't want to talk to them, ignore them and they WILL go away, if you play your cards right.
1. You Are Under No Obligation to Talk to Them.
They'd like you to think you are, but you are not. They want to get you on the phone, like an abusive spouse, so they can use words to poison your mind and soul. Also like an abusive spouse, this is their only weapon, and they need your co-operation to use it. Fortunately, under the law, there is one circumstance in which you MUST talk to someone, and that is if you are subpoenaed to a court of law. "You've been served". This happens in high level court cases. Unless you've been served papers requiring you to appear in a court of law, you don't have to talk to anyone, ever. So, don't talk to them.
2. Change your Voicemail
They will want to leave their toxic threats and intimidation on your voiemail if you dont' answer, but they are bound by privacy laws so can't disclose your debts to anyone. So, say your voice mail is general. "This is the general, non-confidential voice mailbox or John Smith, this mailbox is private and may be checked by a family member or co-worker in my absence. No personal information please. Thanks!" This will limit their voicemails to something discreet like "This ABC company alling about an important business matter. Please return my call ASAP." If your voicemail says it is secure, you give them permsission record terrible, soul disturbing lies and threats.
3. Ignore them
Don't answer numbers you don't know, if they leave a voicemail and its a collection agency, add them to your phone book and assign a silent ring tone. If they can only leave general voicemails asking for return calls, they give up in less than a month. It's not a great month, but it's better than having your sol vomited on and declaring bankruptcy to stop their calls.
4. Change your number. They can't call you if they dont have your number, and privacy laws make it very hard for them to find it. They usually give up.
Section Two: Be pro-active.
1. Answer the call, ask them to identify themselves. As them for your the account details they are calling about. Have them identify their name and mailing address suitable for recieving registered mail (which all corporations must legal have and disclose). When that is all done, say "I have already spoken to Rogers/CIBC/Bell/Goodlife about this account. I do not owe this money and have no intention of paying it. I will be sending you a registered letter to that affect. Do not call again"
2. Mail them a registered letter, keep a copy for yourself. Include your full name, the account number, and address it to the collection agency. Say in the letter: Attention ABC Collections: You are hereby notified I do not owe this money and have no intention of paying it. Do not call again or attempt to contact me again." They are not allowed to harass you, and will not contact you again. You must actually mail the letter, or they will call you again to harass you because you didn't do what you said. You must mail it by registered mail in order to prove that you sent it, they will lie and say they never received anything if you cannot prove you sent it.
3. DO NOT
Admit the debt under any circumstance. This will give them permission to follow up with you on payment terms. They still can;t make you pay, but will call you. DO NOT ever send money. There is a statute of limitations that says after two years of non-payment they can't even choose to sue you, which they wont do anyway, but after two years it's impossible. If you do pay $1, you reset that two year countdown to day one again. DO NOT allow them to talk to you. After you have informed them on the phone of your position, hang up. They are advanced manipulators, don't give them the chance to harass and lie to you. They will win you over if you give them the chance, so don't! They won't call back.
3. Collection Agencies are Powerless
If you've ever spoken to a collection agent on the phone, you know they will blow your mind. You will hang up the phone and want to cry. Maybe you will cry. They will rip off your head and vomit into your soul. They'll humiliate you, threaten you, belittle you, and even resort to actual childish name calling. They use advanced physiological tactics to make you pay them. Their goal is to break you down to the point that you feel embarrassed, powerless, and afraid, actually convincing you that you are scum and they are your righteous disciplinarian. These soulless parasites do this because they know something you don't. They have no real power. Like an abusive husband, they don't want you to know that they have no enforcement power at all.
Here's what they can do:
1. Call you. As you know. They cannot harass you. The biggest mistake when you speak to a collection agent on the phone is to tell them you will pay. If you do, they will call you and demand payment because you have promised to pay them, yet have not. This is not harassment, because they are following up on your promise. For information on how to deal with with these phone calls quickly and effectively, see "Dealing with Collection Agencies"
2. Lie to you. They're actually not allowed to do this, but they do all the time. I've had collection agents tell me that bankruptcy isn't an option anymore because "if it was, everyone would just do that." Which is a blatant bald-faced lie. These bastards will lie, and cheat and call you names and do anything to get their commission.
Here's what they CAN'T do:
1. Garnish your Wages: They need to sue you, which they will not do.
2. Put a lien on your house: Again, they need a court judgment for this, which they will not get.
3. Call your boss, family or friends: They cannot do this unless they do not have contact information for you, in which case they are not allowed to disclose why they are calling, and can only ask, one time, for your contact information.
4. Force you into bankruptcy. They would need to win a lawsuit, and not only do they NEVER sue, a court NEVER drives a person to bankruptcy.
5. Anything. Literally, all they can do is call you, and if you play your cards right, you'll be done with their phone calls after the first one.
Collection Agencies DO NOT SUE, EVER. Because they never win and history taught them that after spending thousands of dollars on a lawsuit, they either don't win, or if they do the person declares bankruptcy and they don't get anything anyway. No one sues, ever, anymore. I've seen $50,000 and $75,000 credit card debts written off. How much do you owe? If it's less than that, you're in no danger. And without a judgement, they can't do anything.
Here's what they can do:
1. Call you. As you know. They cannot harass you. The biggest mistake when you speak to a collection agent on the phone is to tell them you will pay. If you do, they will call you and demand payment because you have promised to pay them, yet have not. This is not harassment, because they are following up on your promise. For information on how to deal with with these phone calls quickly and effectively, see "Dealing with Collection Agencies"
2. Lie to you. They're actually not allowed to do this, but they do all the time. I've had collection agents tell me that bankruptcy isn't an option anymore because "if it was, everyone would just do that." Which is a blatant bald-faced lie. These bastards will lie, and cheat and call you names and do anything to get their commission.
Here's what they CAN'T do:
1. Garnish your Wages: They need to sue you, which they will not do.
2. Put a lien on your house: Again, they need a court judgment for this, which they will not get.
3. Call your boss, family or friends: They cannot do this unless they do not have contact information for you, in which case they are not allowed to disclose why they are calling, and can only ask, one time, for your contact information.
4. Force you into bankruptcy. They would need to win a lawsuit, and not only do they NEVER sue, a court NEVER drives a person to bankruptcy.
5. Anything. Literally, all they can do is call you, and if you play your cards right, you'll be done with their phone calls after the first one.
Collection Agencies DO NOT SUE, EVER. Because they never win and history taught them that after spending thousands of dollars on a lawsuit, they either don't win, or if they do the person declares bankruptcy and they don't get anything anyway. No one sues, ever, anymore. I've seen $50,000 and $75,000 credit card debts written off. How much do you owe? If it's less than that, you're in no danger. And without a judgement, they can't do anything.
2. The Philosophy: Why You Have the Moral High Ground
Debt:
So you're in debt. Why is that? Well there are a lot of reasons we take on debt, you know why better than anyone. The point is that collection agencies don't care. Whether you've had medical expenses, were on vacation and hurt yourself, had to pay to save the life of a loved one and had no option other than your credit card, you'll be treated exactly the same as someone who willing and fraudulently opened a credit account with no intention to repay it.
No Morality Whatsoever:
Here's the thing: a credit collection agency treat all debt the same. They do not discriminate based on why you're in debt and WILL chase down a 90 year old grandmother for using her visa to buy heart medicine that saved her life but couldnt repay it because she is on a fixed income. As debtors, you cannot allow an organization like that to assume any type of moral high ground. They will try, they'll call you a dead-beat, and irresponsible scum bag and a variety of other terms to try and convince you that you are below them, the debt collector. A collection agency in an a-moral institution and therefore, you have no moral obligation to treat them any other way.
Why You Have the Moral High-Ground: Over Collection Agents
You didn't choose to be unable to repay your debts. You decided that you would grow up and be a teacher, a doctor, a farmer, a business professional, a coffee-shop worker or whatever it was that you chose, you wanted your life's work to be something that contributes to society and makes people happy. The collection agent did not. He or she decided that they wanted to spend their lives calling anyone, no matter what, or why, and trying to destroy their sense of self worth, humiliate, harass, and destroy the lives of anyone and everyone as long as they would get a commission out of it. What sort of human being is that? They are scum. You didn't choose to be unable to repay your debt, they chose spend all day everyday hurting people. You are a good person in a bad-situation, they are bad people acting as parasites on the weak, disadvantaged and unfortunate. They prey on people who have fallen on hard times for a living. You would never do that. You are a much better human being than they will ever be. You cannot allow a person like that to tell you that you are a "bad-person".
Why You Have the Moral High-Ground: Over the Original Debt
Credit Cards:
Credit card companies and financial are modern day slavers. They didn't used to be. When credit cards were invented they were to be used as a convenience and paid off monthly. They were easier to use than cheques, and there were no ATM's at the time, so they provided consumers the ability to "charge" things and pay at the end of the month. As recently as the 1980's, people used to have to take their pay cheques to branch every payday, then withdrawl the cash they needed for the month. If you needed more it was back to your branch to wait in line for an hour, and god help you if it was after 4pm or a weekend. That all changed in the 1990's. Credit cards realized that they could make a lot more money of people didn't pay of their balances. At the time, they would give you a $300-$500 limit so you could pay it off every month. They decided to change the business model: if you could afford $300/month, why not give you a $10,000 limit and make your month payment $300? Thus, the era of debt slavery began. If they know you can only afford $300 a month, they'll have you wrack up a $10,000 debt at 20% and keeping you paying $300 forever, never reducing the principal. They are predators, modern day financial slavers. They DO NOT want you to be out of debt, the WANT you to be in over your head. They want to make you their financial slave until you die. If you havent seen the documentary "Maxed Out" I suggest you watch it. It shows real cases of credit card companies driving people to suicide, and court judgments against the same companies for shreding peoples payments so they could charge them over-limit and late payment fees.
Fitness Clubs:
Credit cards companies are the worst offenders, but if you've ever had a gym membership, you know how that works. I myself had a Goodlife membership that I cancelled and had sent to collections. Gyms are notorious offenders for completely disregarding the truth and just chasing down payments. In my case, I had been a member for years, went almost everyday, and never missed a payment. When I moved and there wasn't location nearby I called in to cancel, and they told me that was fine. Six months later I started getting calls from a "lawyer" debt collector who told me that I couldn't cancel over the phone and that I owed them $200. After many, many emails to their head office telling them: "I cancelled, I've never missed a payment before and used to go almost everyday, I moved and cancelled, you can tell by your computers I have not been in a club since" all they said was, that they didn't care and to pay-up. Eventually I told them that they obviously had no intention of retaining me as a customer despite my years of patronage, and that anyone would agree based on the stated circumstances that I was clearly in the right, so they would have to sue me. Obviously they did not. We'll come back to that later.
Utilities:
Bait and switch. They get you in with promises of low monthly service costs, then you get your bill and it's full of usage fees, fees for everything, and purposefully convoluted billing schemes. Rogers and Bell are the same in my experience. I signed up for internet with them at $35/months, wth all the fees and everages I was paying $100/month. How is that fair? Imagine if your mortgage company did that. Ok, well your payment is $1000/month, but you're using a different bank so thats an extra $1000 and you were late one month this year so there is another $1000. If you budget based on what they tell you (say Rogers High-Speed Internet at $45/month and they charge you twice that, it's their fault if you can't pay it. Stick the prices you advertise and then you'll have the high ground, play bait and switch and its your fault if I can't pay, and I don't feel bad for you for a second. The same thing happens with cell phone, most Canadians sign up for $35 plans and end up at close to $100. If you play bait and switch, you lose your ability to hold me to a moral contract. I budgeted one thing and committed to pay it, you changed that price so that's your fault.
Why You Have the Moral High-Ground: That's Capitalism for Ya
Capitalism isn't a one way street. Whether you're dealing with a bank debt, utility or whatever, they will do the exact same thing to you without considering the morality of it, so why should you. If the company has a bad year, they fire people and say "Sorry, that's business. I don't care if you moved here for this job, I don't care if you quit a job to work here, it's not personal, it's business". If they go bankrupt, they won't pay you they money they owe you in wages, that's business. If they're allowed to justify their decisions with "That's business", so can you. They quoted you one thing and charged another so you can't afford it and won't pay it. That's business. They tried to enslave you at 20% by granting you $50,000 in credit even though you don't make that much in a year? Screw you, I'm not your financial slave, that's business. You have no business operating in such bad faith, so the trade of is that I'm not paying you. You didn't care about my financial interest, so why should I care about yours? Guess what, I don't. That's business, and you can do it to me so I can do it to you.
Why You Have the Moral High-Ground: It's Intentional
Keeping these corporate evils in mind, it's important to note they put you in this position on purpose, you didn't get yourself into it on purpose. They want you to pay 20% forever. They want you to sign up for a three year contract at $35 a month, then charge you $100/month, $150 to move your service, and a variety of other fees that they pile on to financially pillage and enslave you. You are not the bad-guy, they are.
So you're in debt. Why is that? Well there are a lot of reasons we take on debt, you know why better than anyone. The point is that collection agencies don't care. Whether you've had medical expenses, were on vacation and hurt yourself, had to pay to save the life of a loved one and had no option other than your credit card, you'll be treated exactly the same as someone who willing and fraudulently opened a credit account with no intention to repay it.
No Morality Whatsoever:
Here's the thing: a credit collection agency treat all debt the same. They do not discriminate based on why you're in debt and WILL chase down a 90 year old grandmother for using her visa to buy heart medicine that saved her life but couldnt repay it because she is on a fixed income. As debtors, you cannot allow an organization like that to assume any type of moral high ground. They will try, they'll call you a dead-beat, and irresponsible scum bag and a variety of other terms to try and convince you that you are below them, the debt collector. A collection agency in an a-moral institution and therefore, you have no moral obligation to treat them any other way.
Why You Have the Moral High-Ground: Over Collection Agents
You didn't choose to be unable to repay your debts. You decided that you would grow up and be a teacher, a doctor, a farmer, a business professional, a coffee-shop worker or whatever it was that you chose, you wanted your life's work to be something that contributes to society and makes people happy. The collection agent did not. He or she decided that they wanted to spend their lives calling anyone, no matter what, or why, and trying to destroy their sense of self worth, humiliate, harass, and destroy the lives of anyone and everyone as long as they would get a commission out of it. What sort of human being is that? They are scum. You didn't choose to be unable to repay your debt, they chose spend all day everyday hurting people. You are a good person in a bad-situation, they are bad people acting as parasites on the weak, disadvantaged and unfortunate. They prey on people who have fallen on hard times for a living. You would never do that. You are a much better human being than they will ever be. You cannot allow a person like that to tell you that you are a "bad-person".
Why You Have the Moral High-Ground: Over the Original Debt
Credit Cards:
Credit card companies and financial are modern day slavers. They didn't used to be. When credit cards were invented they were to be used as a convenience and paid off monthly. They were easier to use than cheques, and there were no ATM's at the time, so they provided consumers the ability to "charge" things and pay at the end of the month. As recently as the 1980's, people used to have to take their pay cheques to branch every payday, then withdrawl the cash they needed for the month. If you needed more it was back to your branch to wait in line for an hour, and god help you if it was after 4pm or a weekend. That all changed in the 1990's. Credit cards realized that they could make a lot more money of people didn't pay of their balances. At the time, they would give you a $300-$500 limit so you could pay it off every month. They decided to change the business model: if you could afford $300/month, why not give you a $10,000 limit and make your month payment $300? Thus, the era of debt slavery began. If they know you can only afford $300 a month, they'll have you wrack up a $10,000 debt at 20% and keeping you paying $300 forever, never reducing the principal. They are predators, modern day financial slavers. They DO NOT want you to be out of debt, the WANT you to be in over your head. They want to make you their financial slave until you die. If you havent seen the documentary "Maxed Out" I suggest you watch it. It shows real cases of credit card companies driving people to suicide, and court judgments against the same companies for shreding peoples payments so they could charge them over-limit and late payment fees.
Fitness Clubs:
Credit cards companies are the worst offenders, but if you've ever had a gym membership, you know how that works. I myself had a Goodlife membership that I cancelled and had sent to collections. Gyms are notorious offenders for completely disregarding the truth and just chasing down payments. In my case, I had been a member for years, went almost everyday, and never missed a payment. When I moved and there wasn't location nearby I called in to cancel, and they told me that was fine. Six months later I started getting calls from a "lawyer" debt collector who told me that I couldn't cancel over the phone and that I owed them $200. After many, many emails to their head office telling them: "I cancelled, I've never missed a payment before and used to go almost everyday, I moved and cancelled, you can tell by your computers I have not been in a club since" all they said was, that they didn't care and to pay-up. Eventually I told them that they obviously had no intention of retaining me as a customer despite my years of patronage, and that anyone would agree based on the stated circumstances that I was clearly in the right, so they would have to sue me. Obviously they did not. We'll come back to that later.
Utilities:
Bait and switch. They get you in with promises of low monthly service costs, then you get your bill and it's full of usage fees, fees for everything, and purposefully convoluted billing schemes. Rogers and Bell are the same in my experience. I signed up for internet with them at $35/months, wth all the fees and everages I was paying $100/month. How is that fair? Imagine if your mortgage company did that. Ok, well your payment is $1000/month, but you're using a different bank so thats an extra $1000 and you were late one month this year so there is another $1000. If you budget based on what they tell you (say Rogers High-Speed Internet at $45/month and they charge you twice that, it's their fault if you can't pay it. Stick the prices you advertise and then you'll have the high ground, play bait and switch and its your fault if I can't pay, and I don't feel bad for you for a second. The same thing happens with cell phone, most Canadians sign up for $35 plans and end up at close to $100. If you play bait and switch, you lose your ability to hold me to a moral contract. I budgeted one thing and committed to pay it, you changed that price so that's your fault.
Why You Have the Moral High-Ground: That's Capitalism for Ya
Capitalism isn't a one way street. Whether you're dealing with a bank debt, utility or whatever, they will do the exact same thing to you without considering the morality of it, so why should you. If the company has a bad year, they fire people and say "Sorry, that's business. I don't care if you moved here for this job, I don't care if you quit a job to work here, it's not personal, it's business". If they go bankrupt, they won't pay you they money they owe you in wages, that's business. If they're allowed to justify their decisions with "That's business", so can you. They quoted you one thing and charged another so you can't afford it and won't pay it. That's business. They tried to enslave you at 20% by granting you $50,000 in credit even though you don't make that much in a year? Screw you, I'm not your financial slave, that's business. You have no business operating in such bad faith, so the trade of is that I'm not paying you. You didn't care about my financial interest, so why should I care about yours? Guess what, I don't. That's business, and you can do it to me so I can do it to you.
Why You Have the Moral High-Ground: It's Intentional
Keeping these corporate evils in mind, it's important to note they put you in this position on purpose, you didn't get yourself into it on purpose. They want you to pay 20% forever. They want you to sign up for a three year contract at $35 a month, then charge you $100/month, $150 to move your service, and a variety of other fees that they pile on to financially pillage and enslave you. You are not the bad-guy, they are.
1. Welcome: Collection Agencies Stink, Not You
So you're getting annoying phone calls
This is where it begins. Your phone starting ringing, it's usually from a random 800 or 416 area code, and the battle has begun. Collection agency calls are the worst; the people that work there are total a-holes, they frequently disregard the laws governing their ability to collect debts and WILL try and humiliate you. They're very, very good at their jobs. Without guidance, you'll be easy prey. You'll pay too much and reward and sustain the human scum that feed on the misfortune of others. Fortunately, collection agencies are in most cases as powerless as they infuriating, which is great news for you customer.
This blog will advise you on exactly what to do regardless of your circumstance. I'll tell you when to pay, when not to, and exactly what your options are. I'll go over the laws governing debts in Canada, and I'll tell you everything you need to know in order to get out of debt with your dignity and as much of your money as possible. We'll explore exactly what a collection agency can do, what they can't do, and even the "philosophy" or debt and capitalism so you can get back some of the dignity these jerks have been eroding with their lies and humiliating tactics.
Read on my fellow citizens. You'll feel a lot better soon, and we'll give you your power back.
This is where it begins. Your phone starting ringing, it's usually from a random 800 or 416 area code, and the battle has begun. Collection agency calls are the worst; the people that work there are total a-holes, they frequently disregard the laws governing their ability to collect debts and WILL try and humiliate you. They're very, very good at their jobs. Without guidance, you'll be easy prey. You'll pay too much and reward and sustain the human scum that feed on the misfortune of others. Fortunately, collection agencies are in most cases as powerless as they infuriating, which is great news for you customer.
This blog will advise you on exactly what to do regardless of your circumstance. I'll tell you when to pay, when not to, and exactly what your options are. I'll go over the laws governing debts in Canada, and I'll tell you everything you need to know in order to get out of debt with your dignity and as much of your money as possible. We'll explore exactly what a collection agency can do, what they can't do, and even the "philosophy" or debt and capitalism so you can get back some of the dignity these jerks have been eroding with their lies and humiliating tactics.
Read on my fellow citizens. You'll feel a lot better soon, and we'll give you your power back.
Subscribe to:
Posts (Atom)