Reporting Credit Card Delinquencies - Collectors Leverage

[pipeguy]

I recently read an article by Edited to remove a full name , Director of Operations Gila, LLC (Gila LLC is a Debt Collection Agency http://www.gilacorp.com/index.aspx). The article was written for fellow debt collectors having to do with ethical, legal and proper compliance in reporting to the CRA's. What I found interesting is the first paragraph of the article, it's very telling for consumers as to debt collectors standard operating procedures. The paragraph stands on its' own, even though the text was just a lead in to a completely different subject.

We all know that reporting delinquencies to credit reporting agencies (CRA) is a great way to get an individual’s attention. The delinquency will most often appear as a key derogatory item on a credit report, lowering the FICO score, and this may cause the individual to pay higher interest or render them ineligible for extensions of credit or loans until the matter is resolved. And with hundreds, thousands, or more accounts reported to the CRAs each month, it becomes easy to overlook our own obligations with respect to every single account we’re reporting.

[RobertEG]

I dont know who that person is, but disagree with his statement. 

Consumers dont have account agreements with debt collectors.  They have no account terms upon which to base a delinquency.

Collections are accounts established between the debt collector and CRA for reporting their collection activities.

Consumers arent billed monthly by debt collectors, and dont accrue monthly delinquencies under a collection.

Debt collector reporting is retained in an entirely different segment of a consumer's credit file from reportings made by creditors.  Reporting codes available for debt collectors dont not even include monthly delinquency codes.

Delinquencies are reserved for consumer failure to comply with terms of their OC account agreements. 

Note that the cited blurb does not explain what "delinquency" they can allegedly report. 

[pipeguy]

Robert - I can PM you the complete articile if you want to read it. The whole article actually looked at steps needed to correctly report updates to consumers files, I just thought the first paragraph was very telling in how the debt collection business sees CBR's as a means to pressure their targets, rather than just a way to report status.

[pizzadude]

Yeah I totally believe that CAs will not hesitate to insert/update/re~insert collections to make sure that they maximize the ability to apply leverage against consumers.