A common scenario about how debt collection works:
Sam is in need of money so he reaches out to a lending company or credit card company. Sam signs a contract and now becomes a customer of that company in order to receive the funds. Since Sam has signed this contract and received the funds, he must now make payments weekly or monthly to the company he borrowed from. Sam encountered some hard times and began missing payments. Once some payments were missed, he then owed double payments trying to catch up. Sam’s debt grew more and more and he fell even more behind.
Does this sound familiar? Unfortunately, it happens to so many people!
Here is part of the story you may not know…
The next steps in Sam’s journey you may not be aware of. After a person misses these payments, the account becomes delinquent. The creditor then charges the account off. Once charged off you can either pay the balance or the account gets sent to collections.
After it is in a collection agency, such as Wellington Capital Partners, the collection agency sends letters and tries to communicate with the debtor (customer) via telephone. When contact is established, a representative from a collection agency then tries to negotiate the best arrangement for the creditor and the customer.
A settlement can be made, where the customer or debtor saves money off of the balance. In another situation, payment plans are created, either weekly or biweekly, depending on the customer’s financial situation. Once the debt is paid, the account gets updated as paid in full or settled in full. A letter is sent out to the customer and then the updates are made on the credit report. This update clears the debt with the original creditor and the current creditor.
Now that you know, let us help you with your debt collection!
Now that you know how debt collection works, call us today! Our representatives are standing by to assist you. Call us at +1 (866) 413-4611 so we can work out a plan for you. If you’d like to email us first instead, use our contact page!