Insider stories from a debt collector

Our personal finance article for today has been long awaited by many INQUIRER.net readers.

Credit card debt is a common problem. Being mired in debt does not mean a person is evil – it only means that person has not managed money well in the past. That’s all…

So, what to do when you’re already in the clutches of a debt collector? Being badgered by someone to pay credit card debt is depressing and demeaning especially when they start talking to your officemates, your relatives and even your boss! This article lists down ways to deal with it, but my favorite tip is to call them first before they call you.

Tell them of your situation and let them know how much you can pay them monthly for the next several months or years. More often than not, they will listen and allow you to stick to your debt payment plan since at the end, all they want is to get paid.

I confirmed this with someone who works as a debt collector who naturally requested for anonymity. Since debt collectors only earn income when they collect, they would rather reach an amicable settlement rather than have a screaming match with people on their call list.

“This is a highly stressful job because people at both ends of the line become allergic to each other. That’s why we are so much more lenient when the credit card holder shows that he is willing to pay rather than those who slam the phone the first time they hear of us,” he said.

These guys actually have the authority to give cardholders some breathing room. “They (the credit card companies) give us a sheet that shows how much their payables are, how much interest the bank is charging, how much penalty our company can add. We then can sometimes play around with the penalty part. If removing a few percentage points can ensure that he will pay, then that’s what we do,” he said.

Unfortunately, he said some credit card holders are boorish and avoid responsibility for their debt. “It’s not unusual for people to go to courts and that will increase their penalties even more,” the debt collector said.

So What Chocnut?

This just in from HSBC – 0% interest on balance transfers. Transfer has a limit, though, only up to P12,000 and only for one year. The bank says in the advertisement that there are no handling fees and no hidden charges.

Let’s deconstruct the ad. HSBC is willing to give new cardholders 0% balance transfer rate so to get more cardholders. It expects new customers to use that card to spend on many other things. It’s not clear what will happen once you charge other purchases and become a roller. So be careful.

Read more blog posts here on how to tame the credit card beast and turn it into a friend.

Ron Nathan writes today about how Wall Street’s woes surrounding the sub-prime market in the United States is affecting the local stock market. Pinoy Investor says the market is in a technical correction and its time to buy!

Here’s the full report on what a stellar performance GMA7 turned in during its trading debut Monday.

Daxim Lucas of the Philippine Daily Inquirer says banks’ bad loans to total loans ratio went up in May. Here’s why the bad loan ratio of commercial banks matter to you: how do you think banks recover the losses they have from writing off non-performing loans? That’s right, the borrowing rates they charge you.

Read about the ongoing saga of well-heeled investors who got caught in the Performance Investments Products Corp. scam here.

In every strata of society, there are people who commit fraud and act with malice towards other people. Be more careful with your investments. Stay clear of smokes and mirrors. If you can’t understand the investment scheme, then don’t invest. My earlier smell test on Deutchfrancs will also hold true for PIPC. Get away from anything that stinks.

ForceAnalytics wrote about PIPC in his blog and got an irate comment from a reader. Somehow, I thought I had seen those comments before? Hehe.

My favorite food blogger also wrote an incisive post about it and got even more irate readers to comment. Read marketman’s post here.

Then, another deplorable scam: Illegal recruiter victimizes Leyte teachers, deans, lawyers.

Finally, I love what Digerati Life has written today about how to shrug off a market slide.

1. Think like a contrarian.
2. Act like a contrarian.
3. Be well hedged or have a well diversified portfolio.
4. Don’t fall for the media hype. (yeah, I agree)
5. Anticipate possible buying opportunities
6. Realize that market pullbacks are healthy for the long term.

Are you ready to be a contrarian?

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