Welcome back to debt collection 101, your beginners guide to debt collection. In article two of this series, I wrote about what a debt collector will do after they have located their debtor and informed them of their debt. Many times collection agents can make it easier for debtors to pay back their delinquent accounts, can be friendly and offer advice, but also have the ability to mark your credit score negatively, and hand your account over to an attorney if you refuse to pay.

In article one, I spoke about the two different kinds of collection agents, in house collectors, and third party collectors. In house collectors are debt collectors that work directly for the creditor, and these creditors are usually financially based organizations like mortgage or credit card companies. Third party debt collectors make up the majority of debt collectors and work directly for a third party collection agency that is hired by a creditor to collect on their delinquent accounts.

Due to the fact that in house collectors work directly for their creditors, they are not restricted by a number of the rules and provisions of the Fair Debt Collection Practices Act (FDCPA). However, third party debt collectors are, and there are a number of rules and regulations that they are bound by.

In addition to the Federal regulations third party collection agents have to abide by, they also have to be careful to abide by the state procedures that apply too. Debt collection is closely monitored because of the fact that people’s financial issues have the capacity to be a sensitive issue. According to the Federal Trade Commission, a collector must positively verify that they are speaking with the debtor themselves, and not anyone else before they can proceed.

After they have positively identified the debtor, the debt collector will issue a statement, known as a “mini-Miranda” which lets the consumer know that this phone call is an attempt to collect debt, and any information in the conversation can be utilized to do so. The numbers of regulations and rules for a collection agent who is calling cross country can be overwhelming. A number of companies use electronic systems now to help debt collectors keep track of all of the rules regarding each call. To be continued in parts 4, 5, and 6.

Mallory Megan works for Rapid Recovery Solution and writes articles about credit collection agencies. Check here for free reprint licence: Debt Collection For Beginners: Rules And Regulations.

Looks like another library is getting tough with patrons. In a localized area of Australia, nearly $30,000 worth of books, DVDs, CDs and magazines are outstanding items at libraries.

Insanely, one borrower owed almost $2500. After you are done scratching your head and pondering why the patron didn’t just buy the books brand new from a company, allow me to bring to your attention that more than 930 items worth $11,467 still need to be turned in to the Aussi Town Campbelltown’s libraries at Campelltown and Athelstone.

It doesn’t end there; the Norwood, Payneham and St Peters libraries have 659 outstanding loans worth some $17,951. Interesting fun facts include the fact that one library member owes $2438 in overdue fees and replacement costs, and the most overdue item at the Campbelltown library dates back to April 21, 2006.

Library services manager Suzanne Kennedy pleaded with the public to return the books.

“When borrowers don’t return media items, or hold on to them for far longer than the normal lending period, they are stopping other fellow borrowers from enjoying those resources.” Ouch. Some pretty strong words there. Kennedy continues: “Ultimately, for each item not returned or replacement costs received, the council has to replace, which means that it cannot purchase additional items in its collection.”

Adding to the gravity of the situation is the fact that the number of residents using the libraries was increasing, making it even more important for the books to be returned on time. Local libraries charge two dollars for each late notice plus replacement costs if the item is lost. When a patron’s debt gets to about $100, they are passed on to a collection agency.

According to Campbelltown’s acting library services manager Tamara Williams, patrons paid up when the agency became involved. For now, it is the best these libraries can do to get their fine money…that is until they can hire some more threatening looking nerds to work the desks.

Mallory Megan works for Rapid Recovery Solution and writes articles on commercial collection agencies.

Due to the fresh credit card modifications that are starting up next year, card issuers will have a hard time getting teenagers on college campuses to apply for credit cards without their parents’ knowledge. As students arrive on campus, card issuers will be there to speak to them at many schools.

“Issuers will try to continue to market to college students between now and the time the legislation takes effect,” said Bill Hardekopf, chief executive of LowCards.com, a site that tracks cards. That means schooling them to budget and handle a checkbook and debit card in advance to having a credit card.

Card issuers target mainly young adults because people tend to be faithful to their first card, said Christine Lindstrom, U.S. Public Interest Research Group’s higher-education program director. Plus, young adults are more inclined to carry revolving debt and pay late, producing more interest and fees for the card issuers, she said.

Card issuers also will require a co-signers approval to increase credit limits of a cardholder younger than 21. And issuers won’t be allowed to offer T-shirts or trinkets to entice students. Some credit experts say students need a card to start building a credit history and score.

But there’s no need to rush this, and it can ricochet if students mismanage cards. Young adults should worry less about their credit score and focus more on building good financial habits between ages 16 and 21, said Craig Watts, a spokesman for FICO, the company that created a generally used credit score. “The credit score will take care of itself,” he says.

A survey published in April by Sallie Mae suggests that many young adults aren’t adept managers of credit. Undergraduates on average carried record card debt of $3,173, or 46 percent more than four years earlier.

Certain schools, out of concern for students, does not allow marketers to pitch cards on campus. After a few years of living on their own, paying bills and managing credit, they can apply for a credit card under their own name when they turn 21. Never co-sign, advises Janet Bodnar, author of “Raising Money Smart Kids.” Besides, she added, students are more likely to learn money skills if responsible for their own debt.

Rapid Recovery Solution is a credit debt collection company.