Summary：The article I read has an interesting name called “Struggling debt collectors to debtors: Let's make a deal.” In our daily life, as some credit cards and some debt delinquencies haven raised, collecting on overdue and bad debt has declined sharply. The economic downturn and unemployment rate increases force many debt collectors to try some new strategies for getting money back.
Some new strategies are:
- Accepting down payments on amounts owed instead of demanding payment in full.
- Stretching out payments over several months to give debtors a chance to pay off their debts slowly.
- Negotiating to receive a fraction of the amount owed if paid within a week or 10 days.
- Offering to report the debt -- if paid quickly -- as "paid in full" on the credit report instead of as a settlement, which remains on a debtor's record for seven years.
However, not every new strategy is easy on debtor since many credit card agencies are taking legal action sooner and filing lawsuits to get court judgments up from rather than just waiting for the money.
Connection:
The connection between this article and chapter 14 is the word “credit card” since most information in chapter 14 is talking about credit card. Today, the use of credit card is gradually substituting the use of cash, people found the use of credit card is safe, convenience and easy. However, this also raises some problems, like the debtors do not pay the payments back in the designate period, some people use the advantage of credit card to overdraw and so on. These problems make credit card agencies really hard, so they try to make new strategies to change the situation right now.
Reflection:
Due to the economy situation right now, to create some new strategies mentioned above maybe is a good way to deal with the debt delinquencies. To extend the payment period, stretches out payments sometime do help the people with financial problems. I think another way to change this situation is the credit card agencies need to consider more on the applicants’ financial position when they apply for the credit cards. Make sure the applicants have the ability to pay the payments back is very important.
