On Warren Reports at TPM Cafe they are discussing The Debt Divide here in America. Anyway, one poster, BabyBelle, posted something that I think is very pertinent to the issue of overcharging for debt that is being collected by collection agencies and "debt buyers":
Maxed Out is available on DVD at Amazon now. I just ordered a copy. Looking forward to seeing it.
These debt buyers should be outlawed.
I had a debt sold to one and I was scared and agreed to make monthly payments. They kept me in the dark about the interest they were charging me.
All the while I thought I was repaying a debt when they were not applying any to principal. It was only when I started asking questions that I found out the truth. I never seriously consided suicide, but I was in a deep depression when I realized I had sent so much money and believed I was doing the right thing, only to be lining the pockets of these crooks!
As long as debt buying is allowed there should be [strict] laws and enforcement. One of those laws should be the only interest they can charge is for the amount they purchsed the debt for. So if they buy debt for pennies on the dollar which I have heard they do, then charge interest on those pennies. I personally feel they should not be allowed to charge any interest though.
(Editorial comment: This used to be the law, I think. I seem to remember a time that the interest could not be collected once the debt was turned over to a collection agency. That may have changed in recent years, or perhaps no one has successfully challenged it in the courts. -- OkieLawyer)
The debt I had that was sold to them was ALL interest and fees that Citibank had piled on. The original amount of the debt had been paid. Then these bottom feeders piled on more. I thought interest was charged for money borrowed. I didn't borrow money from any collection agency!
Woe to anyone who is foolish with a credit card or has unexpected problems and gets behind. You'll get screwed by the [credit card companies] with loan shark interest which will lead to you going over the limit if you are unable to pay the balance...and then you will get over the limit fees, even though you have not purchased a thing! And then if the the bottom feeders get your debt they will get their chance with you.
I have lerrned my lesson. Every credit card offer I receive is shredded. I have savings and I live within my means now.
As far as ways to save, if you need furnishings and don't mind some hard work , check out Craig's list.
I have always admired those who could take an old piece of furniture and refinish it, but I was reluctant because of the dire health warnings on some of the products used to strip the paint off. There are now safe products for this work with no harmful fumes. I have found some beautiful solid wood furniture on Craig's [list] for low cost and even free and refinished many nice pieces of furniture. It looks great and is better quality than many things sold brand new.
An interesting fact about the movie MaxedOut, it was inspired by a scheme whereby my alma mater, the University of Oklahoma, received $3 million for allowing credit card companies to market to students on campus. I highly recommend the movie.