How much did the DCA pay for my debt?

2

Comments

  • mr_spud
    mr_spud Posts: 18 Forumite
    the_insider wrote: »
    Why does the debtor have the right to know?

    because the debtor's money is as good as the DCA's money. If the DCA paid the original creditor 10% for the debt, thus wiping it out as far as the original creditor is concerned, at a time when the only option being offered to the debtor was to pay 100%, plus charges, plus interest, it strikes me something hugely unscrupulous and imbalanced is going on, to the massive disadvantage of the consumer. It's plainly inequitable.
  • ihatedebtcollectors
    ihatedebtcollectors Posts: 69 Forumite
    edited 10 July 2011 at 11:34AM
    The only thing of any value here is the loan agreement.

    Agreement can be bought and sold as they are enforcible by a third party in a court. They are in effect a form of money.

    If you default, do not pay, the "value" of this agreement goes down (not the same as the amount owed). This agreement becomes "sub prime" and worthless.

    DCAs buy these and attempt to collect on the original amount (as this is what they are entitled to under your agreement), but you can settle for less with the DCA. Equally, they can refuse and request the original - this makes bad business sense due to having to go to court and would get a very low payment every month towards the debt.

    The system sucks, but it's no worse than people making an insurance claim on a company which is clearly fraud, however, they will pay out anyway due to this being the cheaper option in the long term.

    Best option is to set yourself up as a DCA and buy your own debt lol.
  • mr_spud
    mr_spud Posts: 18 Forumite
    ihatedebtcollectors wrote: »
    The only thing of any value here is the loan agreement.

    Agreement can be bought and sold as they are enforcible by a third party in a court. They are in effect a form of money.

    If you default, do not pay, the "value" of this agreement goes down (not the same as the amount owed). This agreement becomes "sub prime" and worthless.

    DCAs buy these and attempt to collect on the original amount (as this is what they are entitled to under your agreement), but you can settle for less with the DCA. Equally, they can refuse and request the original - this makes bad business sense due to having to go to court and would get a very low payment every month towards the debt.

    The system sucks, but it's no worse than people making an insurance claim on a company which is clearly fraud, however, they will pay out anyway due to this being the cheaper option in the long term.

    Best option is to set yourself up as a DCA and buy your own debt lol.

    brilliant answer, thanks. funnily enough, i hadn't quite got as far as setting myself up as a DCA and buying my own debt, but I had got as far as "why don't they rebrand themselves?". by which i mean setting themselves up as problem-solvers rather than problems? "Got a debt? we bulk buy them for 10% on YOUR behalf! give us 15% to cover our overheads, and walk into the sunset!". would be interesting to use the buying power of a commercial DCA to do the job of, say, CCCS. Why is nobody doing that?:)
  • chanz4
    chanz4 Posts: 10,890 Forumite
    First Anniversary Name Dropper First Post Xmas Saver!
    why should they? you become a high risk when you default
    Don't put your trust into an Experian score - it is not a number any bank will ever use & it is generally a waste of money to purchase it. They are also selling you insurance you dont need.
  • mr_spud
    mr_spud Posts: 18 Forumite
    edited 11 July 2011 at 7:50AM
    chanz4 wrote: »
    why should they? you become a high risk when you default

    They already do. I'm suggesting, tongue-in-cheek, that they continue, but without attempting to greedily rip people off, harassing them and treating them like !!!!!!. I would have thought though, when attempting to extract money from people with very little of the stuff, that a lower profit margin per debt would lessen their risk? Anyway...

    There's a serious point here though, that if a DCA is able to buy a debt for 10%, why isn't the consumer?
  • RobertoMoir
    RobertoMoir Posts: 3,458 Forumite
    First Anniversary Combo Breaker
    mr_spud wrote: »
    They already do. I'm suggesting, tongue-in-cheek, that they continue, but without attempting to greedily rip people off, harassing them and treating them like !!!!!!. I would have thought though, when attempting to extract money from people with very little of the stuff, that a lower profit margin per debt would lessen their risk? Anyway...

    There's a serious point here though, that if a DCA is able to buy a debt for 10%, why isn't the consumer?

    "Able to buy" is one thing, and you're able to attempt to "buy" the debt at that price. Make them an offer.

    Having the right to force them to sell if they don't want to do business with you or at the price you are offering is something quite different.
    If you don't stand for something, you'll fall for anything
  • FredWhispers
    FredWhispers Posts: 85 Forumite
    Buying at 10% sounds great, but, arent most debts bought completely worthless? Refusals to pay due to lack of/defective agreement, absconders, people who just refuse to pay and dont own a house etc etc.

    For that reason, I guess, the DCA profit probably comes from about 20 or so debts in every 100 bought?

    People refusing to pay debts seems to be the reason we cant get decent full and finals! So why are we on their side? They cost us money!!!!!

    Fred
  • mr_spud
    mr_spud Posts: 18 Forumite
    RobertoMoir wrote: »
    "Able to buy" is one thing, and you're able to attempt to "buy" the debt at that price. Make them an offer.

    Having the right to force them to sell if they don't want to do business with you or at the price you are offering is something quite different.

    i didn't "force" them to buy my debt at any price. i had nothing to do with it, to the extent i don't even know what they paid for it.

    i'm in a slightly odd position here, which is that my partner is the ex-partner of the director of a well-known dca. her/their kids, spend a lot of time in our rented house, despite having lavishly-appointed bought-outright homes of their own. i babysit their kids, whilst their dad's firm phones me up asking me to pay 100% of a debt his firm paid 10-20% for (when they're not on the 6 months per year 5-star holidays paid for from the profits made off the back of people who basically have no money). and i'm not very happy about that. :rotfl:

    if the debt's settled with the original creditor - they no longer care, it's gone, satisfied, whatever - for a fraction of the sum the creditor was harassing me for , then i want to know what that sum was, and why the same offer wasn't made to me. simple.
  • jadex
    jadex Posts: 753 Forumite
    Name Dropper First Anniversary Combo Breaker First Post
    mr_spud wrote: »
    i'm in a slightly odd position here
    slightly? that's exaggeration. :rotfl:
    you are in extremaly odd position IMHO
  • RobertoMoir
    RobertoMoir Posts: 3,458 Forumite
    First Anniversary Combo Breaker
    edited 12 July 2011 at 9:19AM
    mr_spud wrote: »
    i didn't "force" them to buy my debt at any price. i had nothing to do with it, to the extent i don't even know what they paid for it.

    I never said you forced them to buy the debt.
    mr_spud wrote: »
    i'm in a slightly odd position here, which is that my partner is the ex-partner of the director of a well-known dca. her/their kids, spend a lot of time in our rented house, despite having lavishly-appointed bought-outright homes of their own. i babysit their kids, whilst their dad's firm phones me up asking me to pay 100% of a debt his firm paid 10-20% for (when they're not on the 6 months per year 5-star holidays paid for from the profits made off the back of people who basically have no money). and i'm not very happy about that. :rotfl:

    Interesting, but hardly relevant to the problem at hand. I'm sure you understand that business is business and personal life is personal life as far as most people in business are concerned. And if it wasn't your partner's ex buying the debt then it would be another. I wouldn't take it personally (unless there's any sign that the ex is) because that's just going to lead to more frustration and stress to no good end.
    mr_spud wrote: »
    if the debt's settled with the original creditor - they no longer care, it's gone, satisfied, whatever - for a fraction of the sum the creditor was harassing me for , then i want to know what that sum was, and why the same offer wasn't made to me. simple.

    I understand that's what you want to know. The point I'm trying to make is that you have no right, as far as I am aware, to know. Perhaps you should have a right to know (I wouldn't argue with that) but that is a different debate.
    If you don't stand for something, you'll fall for anything
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