Why is it, that the banks use these Debt Collection Agencies? Can anyone tell me?
They generally use them when people neglect to pay what they owe to the bank, ignore their letters and don't bother contacting them. Therefore they have no other choice but to pass the account to a collection agency / Solicitor to deal with on their behalf.
I' m not specifically speaking about the OP but I don't get why this surprises people. What do you want the banks to do?
I know people like to come on and bash collection agencies for "threatening them" and somehow make them sound to be the worst in the world and almost criminal like in their behaviour. However, generally speaking all they want is for you to put a payment arrangement in place that suits everyone and that will be that.
If you are refusing to make any payments whatsoever then of course that is a different matter.
By the way it is not the case that you are not legally obliged to deal with them - it will be in the terms and condition of your loan/agreement that the bank have the right to pass your account onto a third party if they so wish.
Our experience of AIB is appalling. We are single income public sector salary dependent household. We are a low-middle income family and don't hold a mortgage having decided back in 2002 that the property market was insane and opted for renting. I'm a carer of a child with disability. Until earlier this year we were living well within our income and had an ordinary loan that we were repaying steadily to AIB - never missed a single payment. After the budgets this year our income was clobbered in several different ways while our expenses were increased by loss of child benefit for 18yr old, cost of third level ed for her, pay cuts levies and cuts to benefits. We immediately wrote to AIB - not having missed a payment - to say that we were going to run into problems and asjked for an interest freeze on the account. MABS have said we did everything exactly like it should be done. My husband met with a bank representative and showed him all the figures and he agreed to consider the request. We explained that we would continue making what payments we could each month though they would not be very much in comparison to the original loan repayments and we have kept to that. Next thing we received a letter from this man which completely ignored the discussion we had had and made out that we had applied for a new loan. We had done no such thing. The terms of this new loan were much more expensive than the one we had and monthly repayments would have been more than the original amounts. I.e the bank was asking us to pay more money from what it knew was a significantly reduced income. We have written to the branch and headquarters in Dublin several times. All our letters have been ignored and we have now received another letter accusing us of having ignored their communications and threatening further unspecified action if we don't comply with their demands. They are now threatening even morepunitive terms on this other loan they wrongly claim we applied for.
It was the recapitalisation of the banks that put us all in these situations in the first place - that is where our pay cuts have gone. We have done everything possible to be proactive and responsible about the matter but are being treated as if we had done the opposite. Is there not some sort of obligation on AIB to behave reasonably towards its customers? Nobody here is suggesting customers should not repay loans but it is outrageous to suggest that a situation that none of us ordinary folk had an reason to suspect was being created by the banks would throw us all into this mess. It is not us who has reneged on anything but government policy and bankers themselves who are working their recklessness out on so many innocent people. I have no sympathy for people who gambled on stocks, bonds, shares or whatever - yet these people are being are being far better protected than steady customers like us. We had a secure, bank-approved deal based on what were entirely reasonable circumstances so I flatly reject ANY suggestion that we have been in any way culpable in this matter. AIB have made it clear that they don't give a damn about us having been good, reliable customers for a decade - and they are determined to screw us into the ground any way they can. They have lost a potential new customer in my 18 yr old daughter for life over this. We have already switched banks for current account purposes so our only relationship with AIB now is the servicing of the loan.
We've not signed that new loan but he's behaving as if we had. There must be very many people who are in similar cricumstances and I suppose AIB must think their customers will be able to make money out of thin air if they put enough pressure on them.
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