Collection Agency
If you have defaulted on a loan or credit card, you should expect to hear from a collection agency. Even if your debt has been written off, do not think that your problems are over. The chances are great that a collection agency will purchase your account from your original creditor. Why would an outside collection agency want to purchase your account? The reason is they can make money off of it.
For only a few cents per every dollar, collection agencies can purchase your debt. If you defaulted on your credit card that had a balance of $1000.00, your credit card company may write the debt off and take the loss. However, they can turn around and sell your account to a collection agency to make up for some of the loss. For instance, a collection agency may only have to pay $150.00 for a $1000.00 account. This means whatever they collect from you over and above what they paid, it is profit in their pocket.
This would account for why collection agencies can be so dogmatic about contacting you. Collection agencies are notorious for harassing telephone calls and letters. Some even go to great lengths to track you down, such as calling acquaintances or employers.
When you first receive a letter from a collection agency, you should read all of it. In the letter (sometimes in small print) you will see that there is a section telling you about your right to dispute the debt. You will have 30 days from the letter to notify the collection agency whether this is indeed your debt, or not. You should do this through the postal service and not over the telephone.
Once the collection agency receives your letter, they must stop all means of trying to collect from you until they show proof to you that this debt is valid. This can give you the chance to decide what to do, if the debt is indeed yours. Or, it will make the collection agency prove to you that the debt is truly yours if you feel that is in error.