Originally posted by: brandonb
I work for a collection agency, and let me tell you one thing...
It happens!
I don't really want to give away secrets, but I guess it doesn't hurt because the sooner they fix the loopholes, the better off we will be.
If you have a credit limit of $30,000. There is nothing stopping you from maxxing it out and not paying it. What happens is the credit card company will sell the debt to a collection agency, and the collection agency will offer you a settlement, sometimes as low as 50%. So, now the $30,000 bill is now $15,000. The person who is doing this is smart, they arent' spending the money, they save it. So when the settlement comes, they use the money from the credit card to pay the settlement. Now they just profitted $15,000. Do this with 10 credit cards and well you profit $150,000. They have bad credit, and they can't get more cards. But after 3 years, most credit card companies will give the person credit cards again. And they do it all over again. Thats equal to a $50,000 a year job.
Yes, people do it, more than you think.
The companies don't care because they write it off on their taxes as a loss and get refunded by the government. Why do you think there is so many "no credit, bad credit, no problem" commercials on TV. The credit card companies don't really lose much. In fact, it costs more money in lawyer fees and court costs to pursue people who are doing this. So they let it slide and don't even prosecute.
They need to stop giving out credit cards to those with bad credits, and out government should not refund money back to the companies for a loss when doing so.
Originally posted by: Xavier434
Originally posted by: brandonb
I work for a collection agency, and let me tell you one thing...
It happens!
I don't really want to give away secrets, but I guess it doesn't hurt because the sooner they fix the loopholes, the better off we will be.
If you have a credit limit of $30,000. There is nothing stopping you from maxxing it out and not paying it. What happens is the credit card company will sell the debt to a collection agency, and the collection agency will offer you a settlement, sometimes as low as 50%. So, now the $30,000 bill is now $15,000. The person who is doing this is smart, they arent' spending the money, they save it. So when the settlement comes, they use the money from the credit card to pay the settlement. Now they just profitted $15,000. Do this with 10 credit cards and well you profit $150,000. They have bad credit, and they can't get more cards. But after 3 years, most credit card companies will give the person credit cards again. And they do it all over again. Thats equal to a $50,000 a year job.
Yes, people do it, more than you think.
The companies don't care because they write it off on their taxes as a loss and get refunded by the government. Why do you think there is so many "no credit, bad credit, no problem" commercials on TV. The credit card companies don't really lose much. In fact, it costs more money in lawyer fees and court costs to pursue people who are doing this. So they let it slide and don't even prosecute.
They need to stop giving out credit cards to those with bad credits, and out government should not refund money back to the companies for a loss when doing so.
How do they save the money? That means turning your credit into hard cash right? I know I can do something like that with some of my cards but I never actually looked into the details. The only thing I can think of is that they make a purchase then sell that purchase for the amount they paid for it or more. So tell me, how do these people turn their credit into cash?
Originally posted by: Xavier434
How do they save the money? That means turning your credit into hard cash right? I know I can do something like that with some of my cards but I never actually looked into the details. The only thing I can think of is that they make a purchase then sell that purchase for the amount they paid for it or more. So tell me, how do these people turn their credit into cash?
Originally posted by: BlahBlahYouToo
Originally posted by: Genx87
Children shouldnt see any of his debt. But his estate will get raped. If he has a wife, then she is screwed.
what estate? he's got nothing since everything was purchased on credit.
Originally posted by: hanoverphist
Originally posted by: BlahBlahYouToo
Originally posted by: Genx87
Children shouldnt see any of his debt. But his estate will get raped. If he has a wife, then she is screwed.
what estate? he's got nothing since everything was purchased on credit.
that makes no sense. if i buy a car on a visa card, it is paid outright. i own that car. when i die, that car is part of my estate. it will be sold to pay off the visa card balance by either my relatives or the executor of my estate. purchasing on a credit card is like cash sales where the ownership is concerned. when you sign an agreement (like a mortgage) and pay payments against it, then you dont really own that yet. if you are buying a house from a bank, the bank still owns the house until they get paid from your estate. i have insurance to pay off my mortgage in case i die, that way my kids will inherit the house free and clear... my work pays for that add on.
Originally posted by: brandonb
I work for a collection agency, and let me tell you one thing...
It happens!
I don't really want to give away secrets, but I guess it doesn't hurt because the sooner they fix the loopholes, the better off we will be.
If you have a credit limit of $30,000. There is nothing stopping you from maxxing it out and not paying it. What happens is the credit card company will sell the debt to a collection agency, and the collection agency will offer you a settlement, sometimes as low as 50%. So, now the $30,000 bill is now $15,000. The person who is doing this is smart, they arent' spending the money, they save it. So when the settlement comes, they use the money from the credit card to pay the settlement. Now they just profitted $15,000. Do this with 10 credit cards and well you profit $150,000. They have bad credit, and they can't get more cards. But after 3 years, most credit card companies will give the person credit cards again. And they do it all over again. Thats equal to a $50,000 a year job.
Yes, people do it, more than you think.
The companies don't care because they write it off on their taxes as a loss and get refunded by the government. Why do you think there is so many "no credit, bad credit, no problem" commercials on TV. The credit card companies don't really lose much. In fact, it costs more money in lawyer fees and court costs to pursue people who are doing this. So they let it slide and don't even prosecute.
They need to stop giving out credit cards to those with bad credits, and out government should not refund money back to the companies for a loss when doing so.
Originally posted by: CasioTech
I know an old guy who took out 30g loan, used it up for a year and then died. They could fuck themselves.
I'm sure they will stop lending money out to people past their 70's soon. Especially those without assets.
Originally posted by: Homerboy
Originally posted by: brandonb
I work for a collection agency, and let me tell you one thing...
It happens!
I don't really want to give away secrets, but I guess it doesn't hurt because the sooner they fix the loopholes, the better off we will be.
If you have a credit limit of $30,000. There is nothing stopping you from maxxing it out and not paying it. What happens is the credit card company will sell the debt to a collection agency, and the collection agency will offer you a settlement, sometimes as low as 50%. So, now the $30,000 bill is now $15,000. The person who is doing this is smart, they arent' spending the money, they save it. So when the settlement comes, they use the money from the credit card to pay the settlement. Now they just profitted $15,000. Do this with 10 credit cards and well you profit $150,000. They have bad credit, and they can't get more cards. But after 3 years, most credit card companies will give the person credit cards again. And they do it all over again. Thats equal to a $50,000 a year job.
Yes, people do it, more than you think.
The companies don't care because they write it off on their taxes as a loss and get refunded by the government. Why do you think there is so many "no credit, bad credit, no problem" commercials on TV. The credit card companies don't really lose much. In fact, it costs more money in lawyer fees and court costs to pursue people who are doing this. So they let it slide and don't even prosecute.
They need to stop giving out credit cards to those with bad credits, and out government should not refund money back to the companies for a loss when doing so.
Ummm yeah. Funny I work for a collection agency too. And the example you explain simply does not work. Maybe via pure numbers and on paper, but it just doesn't work that way in real life
Originally posted by: Xavier434
Originally posted by: CasioTech
I know an old guy who took out 30g loan, used it up for a year and then died. They could fuck themselves.
I'm sure they will stop lending money out to people past their 70's soon. Especially those without assets.
Most elderly people have money somewhere whether it is in the form of cash or some other kind of equity that lenders can go after. Being that's the case, it leads me to believe that there is still good profit involve with lending money to them without taking huge risks.
Originally posted by: CasioTech
most people who take out big loans usually cash out their assets right away after taking out the loan.
Originally posted by: pnad
Grandpa is pretty poor. Living on SS and a Walmart Greeter job. Has a crappy car and rents a 'senior' apartment.
He knows he doesn't have a whole lot of time left. He runs up the credit cards with 'gifts' for his family. TV's, game systems, laptops, vacation cruises, etc.
CC or collections can't go after the pre-death gifts can they?
Originally posted by: CasioTech
Originally posted by: Xavier434
Originally posted by: CasioTech
I know an old guy who took out 30g loan, used it up for a year and then died. They could fuck themselves.
I'm sure they will stop lending money out to people past their 70's soon. Especially those without assets.
Most elderly people have money somewhere whether it is in the form of cash or some other kind of equity that lenders can go after. Being that's the case, it leads me to believe that there is still good profit involve with lending money to them without taking huge risks.
the old guy had no kids, wife, or estate. He lived in rent, had good credit, some shitty car. He took out everything he possibly could, spent it and died because he was old and sick.
How can the CC get anything out of that?
Originally posted by: Homerboy
Originally posted by: brandonb
I work for a collection agency, and let me tell you one thing...
It happens!
I don't really want to give away secrets, but I guess it doesn't hurt because the sooner they fix the loopholes, the better off we will be.
If you have a credit limit of $30,000. There is nothing stopping you from maxxing it out and not paying it. What happens is the credit card company will sell the debt to a collection agency, and the collection agency will offer you a settlement, sometimes as low as 50%. So, now the $30,000 bill is now $15,000. The person who is doing this is smart, they arent' spending the money, they save it. So when the settlement comes, they use the money from the credit card to pay the settlement. Now they just profitted $15,000. Do this with 10 credit cards and well you profit $150,000. They have bad credit, and they can't get more cards. But after 3 years, most credit card companies will give the person credit cards again. And they do it all over again. Thats equal to a $50,000 a year job.
Yes, people do it, more than you think.
The companies don't care because they write it off on their taxes as a loss and get refunded by the government. Why do you think there is so many "no credit, bad credit, no problem" commercials on TV. The credit card companies don't really lose much. In fact, it costs more money in lawyer fees and court costs to pursue people who are doing this. So they let it slide and don't even prosecute.
They need to stop giving out credit cards to those with bad credits, and out government should not refund money back to the companies for a loss when doing so.
Ummm yeah. Funny I work for a collection agency too. And the example you explain simply does not work. Maybe via pure numbers and on paper, but it just doesn't work that way in real life
Originally posted by: CasioTech
Originally posted by: pnad
Grandpa is pretty poor. Living on SS and a Walmart Greeter job. Has a crappy car and rents a 'senior' apartment.
He knows he doesn't have a whole lot of time left. He runs up the credit cards with 'gifts' for his family. TV's, game systems, laptops, vacation cruises, etc.
CC or collections can't go after the pre-death gifts can they?
why are you worried they'll take your xbox back?
Rightfully, if it's not paid for, you should return it.
This is the mentality of america. :frown:
Originally posted by: BlahBlahYouToo
Originally posted by: hanoverphist
Originally posted by: BlahBlahYouToo
Originally posted by: Genx87
Children shouldnt see any of his debt. But his estate will get raped. If he has a wife, then she is screwed.
what estate? he's got nothing since everything was purchased on credit.
that makes no sense. if i buy a car on a visa card, it is paid outright. i own that car. when i die, that car is part of my estate. it will be sold to pay off the visa card balance by either my relatives or the executor of my estate. purchasing on a credit card is like cash sales where the ownership is concerned. when you sign an agreement (like a mortgage) and pay payments against it, then you dont really own that yet. if you are buying a house from a bank, the bank still owns the house until they get paid from your estate. i have insurance to pay off my mortgage in case i die, that way my kids will inherit the house free and clear... my work pays for that add on.
well that car you bought for $30k is worth about $15k after 4-5 years, and about nothing after 10 years. I guess it's better than nothing.
i was thinking more in terms of appreciating assets like real estate, and you can't purchase a home on a credit card.
a financially irresponsible person is'nt likely going to make wise purchases anyway.
Originally posted by: CasioTech
I know an old guy who took out 30g loan, used it up for a year and then died. They could fuck themselves.
I'm sure they will stop lending money out to people past their 70's soon. Especially those without assets.
Originally posted by: CasioTech
the old guy had no kids, wife, or estate. He lived in rent, had good credit, some shitty car. He took out everything he possibly could, spent it and died because he was old and sick.
How can the CC get anything out of that?
Originally posted by: Xavier434
Please elaborate. Why doesn't it work in real life? I'm not trying to attack your expertise mind you. I just want to hear it from someone who is directly involved with the industry.