the deal makers- where to proceed

I have received a faxed letter of intent from CollectCorp of Toronto to
sign
off on a loan minus the interest(6200 as 90% orginal balance). This letter
says the collection agentcy is acting on behalf of the bank but there is no
written proof that the bank has excepted the deal. It claims another
letter will be sent as "unconditional verification" when they receive the
money- they have given me untill March 15 to accept. I'm wondering
where it is in Vancouver that i can go and get some legal advice on the
authenticity and binding nature of he letter. Also I had ask for the letter
as precurser to offering them less- I did not want to commit to anything
untill I kenew the collection agentcy and the bank were acting in good
faith.

If you need legal advice on the documents and live in the lower mainland, you may be able to get what you need from Dial-a-law their phone number is 604-687-4680, or try using www.bccba.org.

Good luck!

Laura

Hi there,

Collection agencies have authority to settle debts at about 80%, This is called blanket authority. You can call the bank themselves but they will refer you back to the agency. The agency has a very strict contract with the banks to act on thier behalf, they have to follow the pricacy act in canada.

I have been in this gig for 15 years and I have yet to see an agency give out a SIF letter and it not go through. They could be sued, it is a legal document of offer.

 

 Legal action is not as easy with student loan enforcement. X is correct with this, however, the bank has to grant permission to sue an acoc**t. Agencies cannot just sue unless they have blanket permission to do so, and NOT too many clients of an agency grant blanket permission to sue. Only in the "retail" or consumer debt world .  

 The blanket permission to settle on a debt that an agency is assigned has no set deadline. If the balance is more than $5000.00, the usual percentage of "blanket" settlement is 80%. If less than $5000.00, it is usually 65-75% depending on the individual account. The agencies send out these "settlement" letters to people giving them the benefit of a settlement - with a deadline for ewither month end.. or a certain mnumber of days. The bottom lineis that an individual can call in 10 months, a year, etc,; after receiving this letter and still get that  settlement.

 Agencies use these letters as a resort to entice people to settle for their authorized amount - and to promote commission revenues for the agency and themselves. Remember, collectors operate on commission, and have quotas. The more money they collect over and above their "trigger" or "break-even point", the more the collector earns on commission for themselves.

 So, for an example, Bill Collector has a salary, and a quota. Salaries vary, however, let's say Bill Collector's office quota is $18000.00 (commission). Bill Collector is collecting CSL accounts at a rate of, let's say 18%, to round it off at the closest even number. The norm is or was 17.975%

 Bill Collector has to collect $100,000.00 in student loans to meet his objective office target of $18,000.00. Now, his "break-even" target would depend on his salary, or status within the agency. So, let's say that his "break-even" mark is $15,000.00. Every dollar he generates OVER this $15,000.00, he earns 18% for himself. This is why collectors are in such a hustle and bustle to collect cash. The incentive of commission is what drives collectors because they don't make any real money otherwise. Rules are bent and broken by collectors while trying to close pay outs to earn. Collectors, many current and former wil dsay that "they do what they have to in order to survive and make cash". Otherwise, they are out of a job. If a collector is not consistant, out the door they go and turn-over is the newest plague.

 Agencies use the commission system to "motivate" collectors, however, it is the commission system that creates the real problems because line get crossed,, and rules get broken.

X, you can relate to this becasue you were an executive at an agency. Management collects from the collectors. That is how management gets paid their commission. Management pressures collectors so they can earn also. Management within the colelction agency industry is the real problem because these rules that are broken happen all too often. Management is responsible for this.

   

 

 

 Don't get me wrong. I am not labeling the managers of these firms as the culprit. I am labeling the environment and those who corrupt it. Managers are under more pressure and scrutiny than the collectors are in every case. Management doesn't condone the breaking of rules in some cases. Managers cannto be everywhere at once to see and hear what collectors are saying or doing. Some management figures are willing to break rules though. You have seen it, I assure you. I have dealt with (Sternly) many management figures for misconduct and direct breach during the course.

 If you and I were to sit down at a table, we would come up with the same names.

 Johnny