Debt Collection - At what amount of money owed is it not worth pursuing a debt?

magicmushroom

Different companies have different policies.

Where I work, we will persue all debt, even 30e, through a 3rd part debt agency who are paid commission only. They will send letters and make phone calls but that is all. This is normally enough though, most people pay at this stage.

If they are unsuccessful in obtaining payment, debts under 500e get written off and anything over 500e gets sent to our solicitors where we go the whole way - trace, judgement, sheriff, examination etc.

In my previous job no debt was persued via legal action, no matter how much they owed.

I had a debt of 850e with a phone company last year, I had one solicitors letter and never heard any more about it after that. Funny thing was, I actually responded to the letter with an email and a phone call to offer 20e per week repayment plan and they never got back to me!

thehouses

OSI wrote: »

Did you actually end the contract, or did you just stop paying after the fixed term?

The contract is ongoing, but they are charging incredible data fees and will not cap these even if it runs into the thousands of euro. They cap these fees in the E.U., but won't in Ireland because they are not compelled to do so by legislation. While it may not be seen under law as a scam it sure feels like one. Though there are two acts I believe they are in breach of.

DulchieLaois

I owed a debt collection a huge sum, however they are willing to take a reduce sum of one lump sum ?

Has anybody tried this before and if so, does it affect your ICB

Secondly, can I reduce it further ?

Nino Brown

thehouses wrote: »

The contract is ongoing, but they are charging incredible data fees and will not cap these even if it runs into the thousands of euro. They cap these fees in the E.U., but won't in Ireland because they are not compelled to do so by legislation. While it may not be seen under law as a scam it sure feels like one. Though there are two acts I believe they are in breach of.

Charging for what you use is hardly a scam, you know the fee's, if you use the data, you owe the money. If you can't control how much data you use then turn it off.
A friend of mine was refused a bank loan for not paying a phone bill, I don't know the details of how the bank knew about this, but they found out somehow, so I would be reluctant to refuse to pay a debt based on people saying it can't affect your credit rating.

former legend

thehouses wrote: »

The contract is ongoing, but they are charging incredible data fees and will not cap these even if it runs into the thousands of euro. They cap these fees in the E.U., but won't in Ireland because they are not compelled to do so by legislation. While it may not be seen under law as a scam it sure feels like one. Though there are two acts I believe they are in breach of.

Hang on; you're still availing of the service??

KERSPLAT!

"They are scamming me!"

How?

"Well they aren't actually scamming me but it feels like they are!!!"

The terms and conditions/tariff prices are easily available on all phone sites. If you've ran up a huge data bill it's your own fault, pay the bill.

I would imagine €900 would be well over the point at which they'll come after you

thehouses

Nino Brown wrote: »

Charging for what you use is hardly a scam, you know the fee's, if you use the data, you owe the money. If you can't control how much data you use then turn it off.
A friend of mine was refused a bank loan for not paying a phone bill, I don't know the details of how the bank knew about this, but they found out somehow, so I would be reluctant to refuse to pay a debt based on people saying it can't affect your credit rating.

I know, some will agree with me others will disagree. This thread shows that:http://www.boards.ie/vbulletin/showthread.php?p=86814272

alie

OSI wrote: »

Did you actually end the contract, or did you just stop paying after the fixed term?

I never had a contract before so i stopped paying. I rang the the company and asked to go back to pay as you go. I paid what was outstanding on my account. The guy said as soon as payment is received he would change my phone over. 2 days later i fell on the way to work and smashed my phone. I went into the local phone shop and the guy gave me a number to ring the head office which i did. Explained the situation . Meanwhile i got a new phone from a differenent company. No contract. 6 months later i got this massive bill.

Nino Brown

thehouses wrote: »

I don't think it is moral for a company to be able to allow bills to escalate for customers without limit when they can easily put a cap on the amount customers will run up. They do when data roaming in the E.U. for other customers.

I agree, but if you don't like a company's terms then you don't do business with them, availing of the service then refusing to pay after the fact isn't exactly moral either.

Cabaal

thehouses wrote: »

No, I always pay what I owe, the thing is that in this case they are trying to scam me.

by demanding that you pay them?

I don't think it is moral for a company to be able to allow bills to escalate for customers without limit when they can easily put a cap on the amount customers will run up.

But the customer also has a responsibility here,

Your posts are very lacking in details, over how long was the 900e racked up, what does the 900e relate? (data, calls, texts, canceling a contract early etc).

You claim its a scam but yet you give next to no details.

alie

I started to pay the bill because i accepted it was my fault , even though i wasnt told that i had to ring the company just before 18 months was up.

dudara

The morality or immorality is irrelevant here. You are consuming the service, knowingly, and therefore are liable for it. If you don't like their way of charging you, then stop using the data service, or change supplier.

thehouses

former legend wrote: »

Hang on; you're still availing of the service??

No it's switched off with direct debits cancelled.

thehouses

I won't give the full details because there is a lot to this story. My query is regarding debt collection. I do appreciate everyone's replies at the same time.

Peanut2011

The answer to your first question is YES. Especially in consumer business. The problem they have is that if they get relaxed and don't go after people imagine how many will not pay....

So yes, it is worth chasing €900!

ghogie91

They can indeed I was threatened by a company and solicitor for 400 quid

as they say:
"Owe 400 and you will be taken to court,
Owe 4 million and you will be brought to dinner"

former legend

I'd have thought that, for a phone company, €900 would be at the upper end of their outstanding balances so they would be more likely to pursue it.

You might get away without paying but don't be shocked if your credit rating ends up in the toilet.

thehouses

former legend wrote: »

I'd have thought that, for a phone company, €900 would be at the upper end of their outstanding balances so they would be more likely to pursue it.

You might get away without paying but don't be shocked if your credit rating ends up in the toilet.

Credit rating is only affected if it goes to court.

billy111

'not worth pursuing a dept'? My opinion on this is pay the money you owe and don't be worrying about them pursuing a dept. It amazes me the amount of people how ask this question. Use a service then pay for that service. If you have an opinion that the amount due is incorrect then communicate with the company involved and try resolve the issue.

dudara

It can be expensive to persue debt, but large companies can have teams of people in house, or outsourced to someone else. The large volume and bulk discounts makes it affordable for them to chase debt. Plus, it's also about reputation and making sure that you're not a "soft touch".

So, it's possible for a company to persue for any amount of debt. How much cost and effort they want to put into it is up to them.

clint_silver

the facts are very vague so I'll give you some.

Whether youre in contract or not, they wont end the contract until you either pay it up or agree a payment plan. If you havent done either, do so now. If you dont, youre only hurting yourself.

Now ignoring the ethical fact, you should be paying it, (you dont get to say you dont like their price after you buy the contract), if you decide not to pay on the payment plan, after 6-8 weeks of the first missed payment, it goes to debt collector.
The usual threatening letters will come out. As theyre on commission, the debt collectors will accept a part payment, usually within 60-70% of the original bill depending on your negotiation skills. they wont accept nothing unless the figure is sufficiently small enough. 900e is not. I would fully expect a court case and a judgement for that amount. If it doesnt happen, you've got lucky. Do you feel lucky? I wouldnt at 900e. Having a bad credit rating because of your own naivety in signing up for the contract is on your own head.

you can tell the debt collectors that youre in dispute with the company and theyll pass the debt back to them, then theyll contact you, Ive heard of discounts of up to 50% being given at this stage, again milage may vary depending on negotational skills. I would try this route.

I know someone who didnt get a mortgage because of a phone bill. That was the anecdotal story. Later transpired it wasnt the phone bill, vodafone had a direct debit on a contract that caused an overdraft on her bank balance that wasnt paid off. So it wasnt the phone bill but the unpaid overdraft. but she didnt see it that way. In her mind, if the money wasnt there, vodafone shouldnt have tried to take it out. sigh.

thehouses

Thanks for the detailed and informed reply clint_silver.

slimjimmc

thehouses wrote: »

The contract is ongoing, but they are charging incredible data fees and will not cap these even if it runs into the thousands of euro. They cap these fees in the E.U., but won't in Ireland because they are not compelled to do so by legislation. While it may not be seen under law as a scam it sure feels like one. Though there are two acts I believe they are in breach of.

If you're referring to the EU data cap legislation afaik that only applies to data usage while roaming, not data usage in your home country whether that be Ireland, Germany or elsewhere.

thehouses wrote: »

No it's switched off with direct debits cancelled.

It's not clear if you have formally cancelled your contract in the proper manner but assuming you haven't you should be aware that merely keeping your phone switched off does not release you from an existing contract. If you remain in contract the monthly fees will accrue (network service is being provided whether you actually use it or not) and that €900 will get larger over time, making the prospect of legal action against you all the more likely.

Fred Swanson

This post has been deleted.

thehouses

Fred Swanson wrote: »

This post has been deleted.

Thanks for your reply. Another cost would be loss of business. If a customer vehemently believes that a charge is unjust they will be lost for life and tell many people their story. However if a business deals with a customer fairly and ethically they will stay a customer. Doing business is not just a matter of looking at figures and treating each customer as merely a number.

WildCardDoW

thehouses wrote: »

Thanks for your reply. Another cost would be loss of business. If a customer vehemently believes that a charge is unjust they will be lost for life and tell many people their story. However if a business deals with a customer fairly and ethically they will stay a customer. Doing business is not just a matter of looking at figures and treating each customer as merely a number.

Mate you're definitely in the wrong here, fairly sure they can do without your repeat business.



You'll certainly be unlikely to get a contract with this company again and it could affect your ability to get other services from other companies.

clint_silver

WildCardDoW wrote: »

Mate you're definitely in the wrong here, fairly sure they can do without your repeat business.



You'll certainly be unlikely to get a contract with this company again and it could affect your ability to get other services from other companies.

I have personal experience of getting 40% wiped off a bill at debt collector stage for a family member who's not great with money. The proviso to agreeing to the 40% off and not paying the whole bill was that she could never take out a contract with that company again. 3 months after that she signed up to an offer with them with no questions asked by company. That was last year. Company was vodafone.

former legend

thehouses wrote: »

Thanks for your reply. Another cost would be loss of business. If a customer vehemently believes that a charge is unjust they will be lost for life and tell many people their story. However if a business deals with a customer fairly and ethically they will stay a customer. Doing business is not just a matter of looking at figures and treating each customer as merely a number.

Is not incumbent on the customer to deal with the business fairly and ethically too? As far as I can make out, you agreed to a contract, availed of the service but now don't want to pay the resulting bill.

Have I misunderstood?

thehouses

WildCardDoW wrote: »

Mate you're definitely in the wrong here, fairly sure they can do without your repeat business.



You'll certainly be unlikely to get a contract with this company again and it could affect your ability to get other services from other companies.

I agree, they will be fine without my business. However they will lose out more money than the value of the debt.

Also it would be very easy to get a contract with the company again - all I would do is use a different address and bank account. I imagine it would be easy anyway.

thehouses

former legend wrote: »

Is not incumbent on the customer to deal with the business fairly and ethically too? As far as I can make out, you agreed to a contract, availed of the service but now don't want to pay the resulting bill.

Have I misunderstood?

Yes. In an identical situation in the E.U. there was a cap brought in to prevent "bill shock." Bill shock is a predatory business practise which broadband suppliers use to get as much as they can out of a consumer without putting any real protection in place. Check out http://www.theguardian.com/money/2014/mar/14/mobile-phone-bill-shock-debt and http://www.independent.ie/business/technology/bill-shock-as-using-mobile-in-us-adds-up-to-7500-30242235.html