Comment by HeyLaughingBoy
5 years ago
I think in most states, if you are the original owner of the debt (i.e. you or your business lent the money), you can just go collect it.
But in a case where you're collecting a debt you did not originate, you'll need a debt collector's license in the state where you plan to operate. The license isn't hard to get, but typically there is a very large bond that needs to be posted.
And you're right: if you have the stomach for consumer debt collection and are good at being nice to people (being nice has a much higher success ratio than being a dick when trying to collect), and you're incredibly patient (the really cheap debt is almost uncollectable) it's basically printing money.
source: wife used to be a commercial debt/receivables collector and a long time ago I considered writing debt collection software.
Thanks for giving some insight into that process. I'd rather be patient and take on 'human' risk, which for some reason I feel more comfortable with. I'm probably being overly idyllic, but I just imagine being friendly and reasonable with people and their situations might go a long way, especially reaffirming that you're not some massive bank that doesn't give a shit.
1. Buy cheap debt.
2. Call debtors and offer to teach them to code.
3. Walk them through interviews, etc.
4. Collect!
I don't know if that particular path is viable, but I am somewhat taken by the idea of making money by/while helping people out.
I like the concept.
Honestly I think the toughest part is buying the debt. I tried to do some research, but I'm even more confused how people do it. Do they just call up a bank and ask for some debt? Is there some online exchange for debt? California doesn't require a license or anything to buy debt, so in theory I should be able to, but I'm not sure exactly how to.
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