For American individuals just starting out, the most current analysis of trends in our economy points to the fact that incomes are decreasing. Many financial analysts and leaders in the collections industry have reason to believe that this paradigm change will be a permanent one. Out of all of the demographics in the United States, young adults are the most uninsured when it comes to health care coverage. A massive thirty percent of these individuals have absolutely no insurance to speak of. And even though a large portion of uninsured young people are employed, many have just begun their careers and work at low wage jobs for employers who offer limited or no health care benefits.
From the perspective of the collections industry, this new economic progression has the capacity to have massive ramifications. With this many young adults currently scrambling to pay for day to day expenses, let alone medical bills, experts are predicting that their personal debt will grow to massive proportions. As health care prices spike it is crucial to bear in mind that uninsured young people are twice as likely as those with privatized health insurance to have no education beyond high school. Not only will these people not have coverage, but their lack of education will limit their earnings potential in the future as the job market grows more and more competitive. This, coupled with young people’s financial inexperience makes them prime territory for debt collectors.
Yet another factor is the credit industry itself. With the CARD Act and America’s financial woes, stricter credit standards have been imposed and will most likely make it more difficult for many young people to get credit or loans for “good debts,” any type of productive debt that could improve an individual’s situation such as a mortgage for a home or a loan for post graduate education. As bill collectors scramble to wrap their heads around all of the economic changes, advances in technology make bill collection practices and their regulations (The Fair Debt Collection Practices Act) seem dated and ambiguous. One blaring example of this fact is the existence of cell phones. The FDCPA was written in the 1970s and as a result does not have stipulations guiding cell phone calls, and it is estimated that over forty percent of consumers do not have landlines at this moment. Out of everybody, young people are the least likely to have landlines and therefore the hardest to get in touch with.
One way that collection industry leaders are trying to address this issue is by crafting more methodical profiling systems to help debt collection companies when they are trying to collect on these accounts with an active cell phone number. Better, more efficient communications with credit bureaus will aid them in figuring out if the debtor has obtained a new address or phone number.
Because this is a time to think outside the box, the collections industry can be likened to the wild west. It seems that these days, anything goes. But one thing is for sure: with changes accelerating faster and faster, the smartest debt collection agencies are gearing up for younger adults, attempting to use the ways that these individuals prefer to do business and communicate. Some debt collectors are considering text messages, and many agencies have recently added online systems to their businesses that permits debtors to make payments over the internet, rather than deal with a debt collector in person or via United States Postal Mail.
Rapid Recovery Solution is a commercial collection agencies