Debt Collection, Trick-or-Treat?

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October 31, 2013 by Lisa Brammer

I bet I know what you’re thinking—trick. Tell someone you work for a collection agency and their reaction can pretty much be summed up with one word—yikes! That’s because ours is an industry that is typically thought of with a negative connotation. There are a few other professions I can think of off the top of my head that are met with a similar reaction. How many bad jokes can you think of involving car salesmen, IRS agents, lawyers, or cable TV providers?

Do you know why? In part, I believe that in each of these cases, society has let the actions of a few taint the way they feel about an entire industry. It’s just another case of the light shining the brightest on a few bad actors. It ruins it for the rest of us! Kind of sad, huh?

As much as it pains me to admit, I know there are some collection agencies out there behaving dishonestly and treating consumers disrespectfully. But, I think that only accounts for part of the reason the collection industry is not liked. Let’s face it, when money—sometimes a lot of it—is involved emotions can run high and sometimes you just want to shoot the messenger.

Good or bad, the fact is the U.S. economy revolves around consumption. When low-cost money is available to consumers they spend and when they spend it propels the economy. Those that provide the credit, goods and services do so expecting to be repaid.

That’s where we come in. Have you ever stopped to think about what happens to businesses that don’t get paid? Bad debt can create serious financial problems for any business. When unable to collect the money owed to them public, private and non-profit businesses and municipalities turn their bad debt over to third-party debt collection agencies to recover
Have you ever heard of the old saying, “There is no such thing as a free lunch”? We have a similar one that goes around our office, “There is no such thing as an unpaid bill.” They both are a takeoff of the economic theory that whatever goods and services are provided, they must be paid for by someone. In the case of the “free lunch” it’s true that bars in Milwaukee and other cities around the country used to advertise “free lunches” to get patrons into their establishments during the noon hour. It’s true old-time saloons didn’t charge for the lunches—but make no mistake—they were paid for with the profits made from the many beers and other alcoholic beverages customers bought to wash-down their lunches. And in the case of the “unpaid bill” believe me it will be paid for—in the form of increased prices, layoffs, tax increases, business closures, and unavailable services or goods.

Here’s a staggering and sobering statistic. According the Federal Reserve, the total amount of consumer debt in the U.S. exceeds $11.5 trillion!

In 2011, ACA International; the Association of Credit and Collection Professionals, hired global advisory firm, Ernst & Young, to conduct a study of third-party debt collectors. Their survey reported recoveries of $55 billion in 2010 alone. This recovered consumer debt had a significant positive effect on the nation’s economic health. Check out the results below.

Providing America Jobs
– Direct Collections Jobs: 148,272
– Direct Payroll: $5 B
– Direct & Indirect Jobs: 302,000
– Direct & Indirect Payroll: $10 B

Paying Taxes
– Direct State / Local Taxes: $509 M
– Direct Federal Taxes: $495 M
– Total State / Local Tax Impact: $1 B
– Total Federal Tax Impact: $970 M

Giving Back
– Charitable Contributions: $85.2 M
– Employee Volunteer Hours: 652,300

Even with those few bad apples, a huge majority of this bad debt was collected by ethical debt collectors who treat consumers with the dignity and respect everyone deserves. There are many reasons why people do not pay their bills and reputable third-party collection agencies can provide financial counseling to consumers in an effort to find amicable solutions for both the creditors and the consumers.

If you find yourself in a situation where you have a debt that you are having difficulty paying there are resources out there to help. A great resource is Ask Doctor Debt at It is a free—I mean literally free—website that can answer questions regarding debt collection and the laws that are there to protect you. We posted a blog titled “Questions on Personal Finance? Ask Doctor Debt” back in June, check it out at For your convenience we also provide a link to Ask Doctor Debt on our website, it’s that great of a resource.

So…debt collection, trick-or-treat? I hope you’ll rethink your answer.

Best wishes for a safe and happy Halloween!

Founded in 1950, United Credit Service, Inc. is a full service revenue cycle management and debt collection agency in Wisconsin providing highly effective, customized one on one management and recovery solutions for our business partners. Visit our website at or call 877-723-2902


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