Hacker News Reader

Comment by ingsoc79 | Hacker News Reader

Debt collectors are awful. I've received foreboding messages on my voicemail, which turn out to be debt collectors asking me to rat out former roommates' contact info.

That said, I've found a quick and easy solution for avoiding them: don't buy shit you can't afford, and if you do fall in that trap, negotiate your way out. You can't expect to rack up a huge bill and be surprised you're being held to it.

View on HN

If you lose your job, the "shit you can't afford" can easily include food and rent.

And the trap is made of punitive fees with high rates of interest that soon make any initial borrowing a trivial part of the sum owed.

Anyone who thinks this can't happen to them is being naive. It can literally happen to anyone, including people who are currently independently wealthy millionaires.

All it takes is a major economic downturn and/or some bad investment choices.

You tell a story about how you encountered debt collectors using you to look for someone else, then immediately say the easy way to avoid them is not to get into debt? Do you not see the obvious contradiction here?

That I shouldn't post about debt on the Internet until I've purged all association with people in debt? Help me out here.

No, that from your own story, avoiding debt doesn't necessarily mean you avoid debt collectors.

Many of the complaints against debt collection practices are coming from people who aren't debtors, but are being harrassed because they have a phone number that's changed hands or have been misidentified. That's not something one can avoid by not buying things, and for people who've been the victim of this sort of harrassment, it's a big deal and a reason to hate the industry.

How about hospital bills? Taxes? Obligatory insurances?

In the US hospital bills are typically negotiable.

Medical debt doesn't go on credit reports, so generally speaking they don't really push since there's little teeth to bite with. I've had a LOT of debt on me, and I've dealt with many debt collectors, as well as someone with a ton of medical expenses - all I ever received was letters on those, as opposed to the aggressive calls related to other debts.

Medical debts show up on your credit report just like any others once they go into collection.

The newest version of the FICO credit score[1] does differentiate between medical and non-medical debts, though, where previous ones did not, and it weights the former less severely.

1: http://www.fico.com/en/node/8140?file=7786

This is harsh but true. If you're at risk of losing your job, and you need all that income just to survive - without saving anything - then you're already not in a sustainable situation and should fix it while it's easy, not after you lose your job and become desperate enough to take on foolish debt in the stress of the moment. Similarly, if you depend on your job to pay the mortgage, then be prepared to lose your house when you lose your job. It's not the end of the world, you can still get a pile of cash out of it.

>If you're at risk of losing your job, and you need all that income just to survive - without saving anything - then you're already not in a sustainable situation and should fix it while it's easy

If you're making $100k a year, living in a nice 4 bedroom house, driving late model cars, and not saving, that is a relatively easy fix.

If you're making $10 an hour working retail, there just isn't enough money to pay for cost of living and any kind of substantial savings.

People in this situation (who make up a huge chunk of America), are one expensive car repair away from disaster and debt collectors.

Yes. If you're living hand-to-mouth, then you're already having a problem. Things have already gone wrong. It's too late to put the ambulance at the bottom of the cliff and only worry about people when they fall off - which everybody in that situation is bound to do given enough time.

There is no guarantee people in this situation must fail. They might get a raise, or a promotion, or a surprise inheritance, or win the lottery, or who knows.

Now, obviously you don't want to get into this situation in the first place, if you can help it. But if a person is, then they are not simply doomed as you're saying.

We should not excuse exploitation of people living paycheck-to-paycheck simply on the basis that they're bound to get fucked over eventually so it doesn't matter when or how it happens.

We've had multiple companies falsely claim we owed them money after closing the account. For example, for years a debt collection agency would send us emails and call us about a debt of €0.63(!) - plus a few dozens of euros in late fees - even tough we had a receipt of the payment, which we sent them multiple times.

Reply on news.ycombinator.com