Collection Agency Information

April 8, 2006 11:00 AM

Tell me about collection agencies in general, and collection agencies in Portland, OR in particular.

The short version of a ridiculous story:

I dated a guy for 8 months. Throughout the relationship he was struggling with money issues, first due to the lack of a job, and later due to the lack of free money available while buying a house. Because of this, I wound up paying for a lot of our dates, and oftentimes lent him money, five here, twenty there. Sometimes he'd give me back a bit of the money he owed me, but he always promised to pay me back in full later on. So I kept track.

Move forward to January. I tell him that I want my money, in full, right now (I was starting to distance myself from him and wanted things to be settled). So he gave me a check for $750. I deposited the check, and a week later it was returned to me with a big stamp on it saying "Account Closed".

But the boyfriend had already disappeared. A month later (upon communicating with his mom) I find out that he moved to Las Vegas and, oh wait, most of the things he said to me were lies. The check he gave me was from his old account; while the bank could only tell me that the account hadn't been accessed in several months, I know beyond any doubt that it was completely closed before he gave me the check.

I feel like I'm not doing a very good job in illustrating this because it sounds as if he was a con-artist. No, no, it's rather that the whole situation and his compulsive lying was the product of his low self-esteem and alcoholism. He didn't want to come across as a failure, so he lied to me and pretended that he had much more control over his life than he actually did.

Anyway, I want to push this entire ordeal behind me, but I'm also not above being vindictive. I want (at least some of) the money that he owes me, but more than that I want him to know that I didn't just throw my hands up in complete defeat when he left. So I'm thinking of taking the check to a collection agency. How does this work? Do I just hand them the check, assure them that it was purposely bounced, and tell them that he's in Las Vegas? Is this collection even possible since I don't know where he is? And if so, is it worth the effort?

And if it is, is there a collection agency in Portland, OR that you recommend?

posted by hopeless romantique to Work & Money (10 answers total)

Why not go to the police? What he did was illegal.

Collection agencies work for a commission, and since the amount of money involved here is not that great (by their standards) I doubt they'd give you the time of day.
posted by Steven C. Den Beste at 11:06 AM on April 8, 2006

A collection agency works by intimidation, the ability to convince a debtor that life will get worse if the debt isn't voluntarily repaid. No doubt this chronic deadbeat has many collectors chasing him already, for much larger amounts, and will not be worried by your collector.

Also, collectors take a cut of whatever's recovered. I don't know how much, but apparently it's pretty large. A third? Half?

If you really want to go after the money, file in small claims court. The filing fee should be tiny, the paperwork is easy, and at the end you'll have a court judgement. Which means you've got what a collector doesn't: a way to compel payment whether he wants to or not. Then a collection agency can try to track him down and garnish wages.

However, seriously think about just writing off the lousy experience altogether. As rotten as this is, you're unlikely to see much if any of the money even if everything goes right. Decide how much hassle/pain to yourself is worthwhile exchange for the mere possibility (at best) of inflicting some (very minor) pain on him. So he gets some letters and phone calls. So what? He probably gets dozens of them per day. His behavior, during and after your relationship, demonstrates that he does not care.

Also, a guy with money problems and bad debts in Vegas? If there was ever anything to collect, it's long gone by now.
posted by nakedcodemonkey at 11:31 AM on April 8, 2006

Also, collection agencies are hired by creditors (or they become the creditors themselves by purchasing bad debts) to collect on some sort of transaction for which they would have a paper trail of bills, invoices, accounts unpaid, etc. Collection agencies are many (unpleasant) things, but enforcers-for-hire between private individuals in matters of bad checks they are not. You need to either file a police report or go to small claims court.
posted by scody at 11:34 AM on April 8, 2006

Looking at google, I see that many city/county governments in the US have departments that deal with bad check writers, making them pay their bills or face criminal prosecution. I didn't see anything for Portland specifically, but asking at City Hall might get you some results.

I don't know if you need more documentation than your records to get them to move on something like this, either.
posted by cardboard at 12:07 PM on April 8, 2006

It's illegal to write bad checks. A collection agency may not care to take on an individual debt, and will generally take a cut in proportion to the likelihood of collection. Hard to collect = large percentage. You could use a 3rd party, lawyer or accountant, to write him and offer the opportunity to make good on the check. Small claims is also a good idea, but even if you get a judgement, you have to collect.
posted by theora55 at 12:17 PM on April 8, 2006

Speaking as a merchant, I can tell you that it's pointless to bother with the police. Or do bother, but realize they'll probably just shrug you off. Bad checks have pretty much become a civil matter in most jurisdictions unless it's up above some amount, usually in the thousands of dollars. A few counties have special initiatives against hot checks, but I've seen very few of them.
posted by hodyoaten at 3:12 PM on April 8, 2006

I doubt that a collection agency would take the case without written documentation. A verbal agreement, while being a valid legal contract, is probably not sufficient for them. I don't know exact figures but I seem to recall reading that companies sell off debts to these collection agencies at vastly reduced percentages -- on the order of 10% - 20%. I.e., they get small fraction of what they are owed, but it is guaranteed and not dependant on making the deadbeat pay, so they can just wash their hands of the situation. So even if you were able to sell your debt to an agency, I wouldn't expect to actually recover more than a couple hundred, best case.

If you are actually interested in getting your money, your best bet is probably to sue him in small claims court. It will cost you (both in terms of your time and in filing fees) and he probably will not show, which means you'll get a judgement against him. This doesn't actually get you any money, but it does give you a much more solid case for convincing a collections agency to take your debt, possibly at a better rate.

All in all I don't think that you should expect to actually come anywhere close to getting your money back. If you just want to move on, then you should try focusing on putting all of this behind you. Perhaps winning in small claims court would be a symbolic victory and provide some degree of catharsis, even if you aren't actually able to collect anything.

And as others have said he's probably committed a crime by bouncing that check, so if revenge is on your plate then follow that up with the police.
posted by Rhomboid at 3:51 PM on April 8, 2006

I own a small business in Canby, just south of Portland. We've used collection agencies from time-to-time (primarily one in Salem). There's really no reason you shouldn't contact one (though you should listen to the other advice in this thread, too). It doesn't cost you anything if they don't collect, and the worst they can do is not take on the case. I'm not sure what collections agencies do in personal cases where there's not a lot of written documentation. A copy of the bad check is probably documentation enough, though.

We've had mixed success with collections agencies. I'd say that they've only achieved any success once out of about eight attempts. That's not a high batting average. And, as people have suggested, they will take a big slice of whatever they recover: several hundred dollars, for sure.

But, as I say, it doesn't hurt to pursue this avenue.
posted by jdroth at 4:46 PM on April 8, 2006

This isn't directly on topic, but please forgive.

No. No! NO!!

Don't lend money. Ever. Not to friends, not to family, not to anybody. When somebody is in a spot where they NEED a loan, they probably aren't going to be able to pay it back. If you feel sorry for them (especially the friends and family part), then give them the money. But don't ever lend it.

You'll expect it back, they'll let you down, and then you'll hate them (and they'll hate you for owning a part of them).

The only persons who should be lending money are professionals. Banks. Credit Unions. Mortgage brokers, etc.

Send it to a collection agency if you must, but forget about this money. You're never going to see it again.
posted by I Love Tacos at 5:55 AM on April 9, 2006

Don't profess to say you've put it behind you, you haven't. You want revenge (vindictiveness.)

Let it go. Consider it a cheap lesson.

If he's lying about money like this, perhaps he was lying in his faith to you as well. Don't give him the 'out' of being an alcoholic.

Really put the ordeal behind you. Don't be vindictive. Whatever money, and more important energy you spend - you'll never get back.

Doing nothing? Do something for yourself and let it go. Next time you meet a man where you get that sort of vibe, run.
posted by filmgeek at 8:36 AM on April 9, 2006