College Connect: A lesson in debt collection

Posted By Crystal Beasley

By Andrea Stoll

I have worked at a debt collection agency here in Columbia for about a year and a half. While most people start working in the mail department and get drafted into a permanent department, I was immediately called to work in Bookkeeping.

My job duties include posting debtor payments to their accounts, sending checks to courts with documents and filings, and checking to make sure people are paying on time, among other things.

While working so closely with people trying to work their way out of debt, you learn a few lessons. One is just the pure time commitment it takes to dig out of a hole after you’ve dug it. Most of the people who send payments into the firm are on a personal payment plan, or PPA. Because of this, in almost every case I worked with, the debtor would only pay the minimum necessary amount required.

By paying the minimum amount, it can take years longer to pay off the balance. People deep in debt also have incredibly high interest rates – like 22 or 29 percent.  Loans balloon.

Also, a lot of the time a person has more than one account in our system. So while they could be paying $50 a month on one account, they’re paying $25 a month on two others, all of which are cranking up interest.

Another thing I learned about was garnishments and liens. I had very minimal exposure to these terms before I started at the firm, and so this was new to me. A garnishment is essentially a legally enforced fee on your paycheck from work, so a portion of the check comes to our office instead of your bank account.

Our firm usually only went to this extent if a debtor was failing to make regular payments. This is because not only does it cost time and money to file a garnishment, debtors tend to work with us more easily if we don’t take control of the situation out of their hands.

A lien works slightly differently, but with the same purpose in mind. This is a legal claim on someone’s property, usually a car, to ensure that the creditor gets paid what is owed to them. Again, we only proceed to this step if they don’t follow their plan. There are a lot more intricacies of the business, but I think a general knowledge of the industry is a good tool for all millennials. Debt is a big part of life now, as students are graduating college with so many loans. Once you’re in, it takes a long time to get out.


Andrea Stoll is a student at University of Missouri

SABEW - Walter Cronkite School of Journalism and Mass Communication,
Arizona State University

555 North Central Ave, Suite 406 E, Phoenix, AZ 85004-1248
Phone: (602)-496-7862


©2001 - 2018 Society of American Business Editors and Writers, Inc.