Beware of Scavenger Debt Collectors (continued)

Secondly, the scavenger debt collector won't tell you that they purchased the debt for .07 to .10 cents or even as little as .03 cents on the dollar.  They will go into a grand epic tale about how their investors purchased this debt and they must get their money back.  If you tell them you don't have the money, they will try to determine how much you do have and will start telling you they will accept 80%, then 70%.  The collector might tell you he has to consult with the investors and find out if he can offer you a really good deal -- 50%.  He calls you back and says he was able to convince them to accept 50% as payment in full provided you can get it to them in the next five days.  The truth is that they will accept as little as 25 percent as a settlement.  They will likely not accept anything less than 25 percent because they purchased your debt to make a really nice profit.  See our Debt Settlement section for help negotiating debt.

If you refuse to pay, they will turn your account over to a real attorney, who will send you a threatening letter in yet another effort to intimidate you into paying.  Note that attorneys are forbidden from sending letters claiming they will sue when they won't or can't, so if you receive such a letter from a real attorney, pay attention to what it says to determine if you are really going to be sued.  Does the letter say they are exploring their legal options or that papers are being prepared for suit?  If it says the latter, you are probably getting sued for real since attorneys can't say it if it isn't true.

In any event, they will not actually sue you unless their asset search reveals you have assets to seize.  They aren't going to spend any money suing you if you don't have anything.  After all, you can't get blood out of a turnip.  And don't think you can hide assets, because with today's computers and vast databases, they can find out what you have in checking accounts, savings accounts, what real estate you own, etc.  You really have very little privacy anymore in terms of your finances.
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What property can debt collectors seize?  It depends on what state you live in.  Some states, like Texas and Florida, are very debtor-friendly and creditors can't do much in the way of going after real estate. But other states, such as Vermont, are creditor-friendly and they can attach your wages, levy your bank account or put a lien on your property. 

Click here for state information about wage garnishments.
Scavenger debt collectors are notorious for purchasing really old debt -- debt so old that the statute of limitations has run. If a debt collector contacts you regarding an old debt, do not admit that you owe the debt and do not agree to make any payments.  Simply tell them that the "statute of limitations has run on this debt and do not contact me again".  If they continue contacting you, send them a certified letter, return receipt requested, telling them not to contact you about the debt again.  Remember -- DO NOT ADMIT THAT YOU OWE THE DEBT, DO NOT AGREE TO PAY THE DEBT, AND DO NOT AGREE TO SEND ANY MONEY TO THEM.  If you do, then the statute of limitations might start running all over again, giving them the legal right to sue you.