What lies the collection agencies spread

Many people overestimate the activities and possibilities of collection agencies. It's not as often described on TV: a collection agency can't do more than the creditor themselves. Ø Reading time: approx. 5 min.

  • 1. Lie: if you do not pay, the debt collection will come
  • 2. Lie: they look around at your home, what they can get
  • 3. Lie: the bailiff comes and takes away your TV set
  • 4. Lie: Schufa entry: no more cell phone contract
  • 5. Lie: the credit for the property is in danger
  • 6. Lie: one is not promoted
  • 7. Lie: if you do not pay, you will go to jail
  • 8. Lie: if you don't pay, the employee will fare badly
  • 9. Lie: if you do not pay, you will get more calls
  • 10. the trick with the installment payment
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Collection agencies like to threaten with various phrases that sound insanely bad at first. But what is in each case to the threats? And under what conditions they can be made true?

1. Lie: if you do not pay, the collection comes

Wrong: it does not "come" (see 2.). It may be switched on. The costs of the collection agency are often passed on to the debtor, but this is not legal: the collection agency is a private pleasure at the expense of the creditor. Some courts award collection costs equal to the fees an attorney would have incurred. Others only if the debtor also pays. Many courts do not award any fees at all.

Another question is whether the claim is justified at all. A "reputable" collection agency usually stops its activities if you dispute the claim.

2. Lie: they look around at your home, what they can take

Wrong: a collection agency has no further recourse than the creditor itself. The typical approach of a collection agency is not to stand in front of the door with three shaven-headed gentlemen in suits and sunglasses and say "friendly but firmly": "where is the money?". This is in fact punishable under certain circumstances.

This is why a debt collection agency usually only writes letters. And all to the debtor. Some debt collection agencies send judgments as an example, your name is then not in the judgment. Some send draft lawsuits. This is all humbug, as long as nothing comes from the court.

If you want to dispute, do it exactly once, by fax or registered mail.

Oh: And don't believe everything you see on TV!

3. Lie: the bailiff comes and takes away your TV set

Almost always wrong: a bailiff has two tasks: the delivery of documents and the enforcement of the debt.

Like anyone else, a debt collection agency is also allowed to hire a bailiff to serve documents. Then the bailiff comes by, hands over the letter, you sign – and he leaves.

The enforcement requires that an enforceable title (judgment o.a.) against you. All it takes is a writ of execution. In any case, you will receive mail from the court in advance, in a yellow envelope addressed directly to you. Your name must appear in the letter from the court. Some collection agencies like to send copied judgments with. This is not your case, but another one, which has no effect on you.

When the bailiff enforces, he is not allowed to take your everyday items – and that includes your TV or cell phone. But the creditor is allowed to take away your nice expensive LCD TV and put an old tube set, as long as you can watch TV somehow.

4. Lie: Schufa entry: no more cell phone contract

Very often wrong: you only get a negative entry at Schufa if you don't keep a credit contract. Only contractual partners of Schufa are allowed to create entries, and many debt collection agencies are not. In addition, the debt must be properly dunned and not disputed. That is why most debt collection agencies stop their activities when you dispute the claim. Then the creditor must sue. Dubious companies seldom file lawsuits.

5. Lie: the loan for the property is in jeopardy

False: even if you get a Schufa entry, this does not affect existing contracts. They just keep on paying you. Mostly, however, there is no Schufa entry at all.

6. Lie: you will not be promoted

Complete nonsense: it is your right to object to a claim. This is why no employer will (and should) discriminate against you. Also: how would he know that? Even an official position does not require that you blindly pay every bill that comes along. Even if you are ordered to pay by a court, it will not affect your employment contract or your chances for promotion.

At most, it can be different (depending on your position) if you are convicted of a criminal case. But the collection agency is only interested in money. They almost never file criminal charges. They like to threaten with it, because they see the claims as justified. I have never heard of a consumer who got a criminal case because of a debt collection agency and then was also convicted (exception of course benefit fraud).

7. Lie: if you do not pay, you will go to jail

Almost always wrong: life is not a game, certainly not a dubious board game. Here you do not go to jail so easily. To do this, the creditor must pay you 1. sue, you must 2. are sentenced to pay, but 3. nevertheless do not pay. Then the creditor can take 4. instruct the bailiff. When you receive the 5. cannot get anything because you have nothing, and if you then also 6. If you refuse to give an affidavit that you have nothing, then the creditor may (after he has taken 7. advance payment for prison costs) 8. apply for a warrant of arrest, which then 9. is enforced.

Until then, many, many intermediate steps are necessary and the problem can be averted at any stage (sensibly after 2. or 5.).

8. Lie: if you do not pay, the employee suffers badly

This is 1. almost always lied and 2. absolutely not your problem. In any case, you may not be persuaded to pay for this reason. Certainly: many employees at the hotlines have no other choice than to call people and to make pressure with all means. But you do not stop the suffering by paying, on the contrary: if you support the scam by paying, even more employees will be exploited.

9. Lie: if you do not pay, you will get more calls

This is a sure sign that there is something wrong with the claim. A reputable provider sues his debtors when he wants something and does not harass them. This is also fairer to the bottom line: you get your say in an independent place. And let's not kid ourselves: they probably won't sue anyway, otherwise they wouldn't have to call all the time.

If the harassment gets out of hand, forward the number to tape for a few days, or in extreme cases, change the number. It usually helps to tell the caller at the beginning of the call that you are recording the conversation, and if he doesn't want this, he should hang up.

10. the trick with the installment payment

If you think the claim is unjustified, don't go for installment offers and don't sign anything (except your own rejection letter). Such agreements usually contain an admission of guilt, even if it doesn't say it there. You can usually get rid of this, but it will probably put you under even more pressure later on, because you have supposedly already accepted the claim.