View from the other side

CCDarkside

Hi everyone, long time lurker, first time poster.

I see such a lot of good advice on this board that I thought it might be slightly interesting (or possibly not, lol) to hear from the 'other side' of consumer debt.  I've worked for consumer CC companies for well over 20 years now, from on the phones selling instant credit, instant loans, chasing payments, to writing templates for letters.  I work at the minute for a well known company that is wholly store cards, though they have dabbled with instant loans in the past.

I don't view this company or the whole consumer credit market as 'bad' as its providing a legal service for people wanting credit and yes, it provides me a good living.

That said, and hopefully it may help people in debt and who are worried to hear this...

My company is doing whatever it can to ensure you get into debt and stay in debt, and if it can do that when you are 17 till when you finally die then so be it.

Everyone is just a number on a screen, its nothing personal.  I've had people in floods of tears on the phone and all I can really do is what is prescribed in the company manual, which fundamentally means say things to try to get you to pay or get a PTP (promise to pay).  But if you know me personally and are worried about consumer debt (and remember this is unsecured consumer debt I'm talking about) and we have a chat down the pub...

1.  Don't take out the credit in the first place if you can possibly avoid it.
2.  Companies can and will say anything to worry you into paying.
3.  If you genuinely can't afford your debts don't be scared of defaulting, in fact I'd recommend it.  The sooner the better.
4.  Do not under any circumstances engage on the phone with your creditor (you don't recognise the number, just block it) - send a letter insisting we only contact you through snail mail - send that letter by signed for (old recorded delivery).
5.  Credit record/history - yes that can get trashed, this is only really important if you want to get a mortgage in the next 6 years, otherwise forget about it, it means zero.
6.  Your defaulted account will get 'sold on', most of the time that first means we pass it to just a different part of the same company, its just called a different name to make you think its more serious than it is, the tone of the letters change from being helpful to enforcement.
7.  We have no power to do anything of any real seriousness to you whatsoever, its just consumer debt.  You will not lose your house.
8.  Read #7 again.
9.  When a defaulted account is finally actually sold on, its with thousands at the same time for pence on the pound, and when i say pence I mean pennies.
10.  It's only money, money is made up.  You and your family are what's important.

All that said, maybe you want to pay your debts and you want to keep a 'good' credit history?

One unpopular opinion for you - consolidation can and does work.  But you must immediately destroy all your other means of credit and stick to it and that is very difficult for many folks as they then view the 'saved' money as something they can then spend.  Its not.

Great forum!

Oh and car loans... just don't.

sourcrates

Exactly what we have been telling posters for the last 15 years or so.

Good to confirm our policy is a sound one.

EssexHebridean

Great post - and solid information! 

The consolidation bit - this is exactly true - the problem comes because most people either don't cut up the other cards in the first place, or never revise their spending habits. This leads to a situation where spending continues to outstrip income, and so a few years down the line the debt has grown rather than what the consolidation promised - ie it shrinking!  If people get a working budget in place, learn to live within that budget, and stop using ANY other forms of credit aside from a mortgage and that consolidation loan then there's no logical reason why it wouldn't work. They don't, though!