[MUSIC]
Hi there, Michael Bovee, with Consumer Recovery Network.
And I want to talk today about how to settle your account,
delinquent collection account.
Once it's been purchased by the largest debt buyer in
the nation, Midland Credit Management,
Midland Funding is the purchaser.
Midland credit management is the collection arm,
both of those companies are held by Encore.
Encore is the parent company.
They are the largest debt buyer in the country, and
one of the largest collectors, debt buyers, in the world.
Midland is a little bit more unique
than other debt buyers and or debt collectors
in my experience because mostly they're really smart.
They are very sophisticated in the ways that they target people
for collection and approach the overall collection process.
And I have to tell you, in my experience,
that they're also one of the more fair and or
predictably easier to navigate the collection and or payment
process with when you want to resolve a debt with them.
Now, not everybody's gonna be looking at this video because
they want to resolve a debt with Midland.
So there's a couple of things that I want to talk about.
How to navigate the process when you can't afford to pay anybody,
including Midland.
And how to get along in the process,
when all you really wanna do is just settle the debt for
as little as possible, maybe get your credit report updated or
whatever, and then just move on.
So let's start.
First off, Midland is a purchaser.
They pay far less than what
your balance is when they purchase your debt.
When they purchase the debt,
they're looking to make a profit.
It's the purchase price that allows them to accept less.
So, not much changes and
fluctuates with debt purchasers from year to year.
I mean, I've seen prices as high as like $0.18 on the dollar.
And then, of course, some debts are purchased for
less than a penny on the dollar.
But let's assume that Midland purchased your account from say,
your credit card bank right after they charged it off,
so it's not like it's been a year since you haven't paid.
It's been less than a year since you haven't paid, and so
it's a fresh charge-off.
Midland's gonna approach collecting your charge off
account very specifically, okay?
They're unique now.
I think they started this about two years ago.
What is it? It's the first week of 2016 that
I'm recording this video.
And about, maybe a year and a half ago, I think,
they started offering the people that they purchased debt,
the first outreach.
They'll call you and write to you.
And they'll offer you to work something out with them, and
if you do in a certain period of time, I think 60 or
90 days right now, they will actually not
report to the credit reporting agencies about your debt.
So let's say, Chase, for example, charges off
your account and reporting a balance owed to them.
Once they sell the debt, legally they're not owed a penny, so
they can't report a balance owed to them.
So now you've got a Chase charge-off,
that's a negative thing on your credit.
And normally a debt buyer picks that up and also will report.
Midland does this.
But if they just get the account and
rather than immediately report it, give you an opportunity to
enter in some kind of resolution with them.
Sell it, whether it's lump sum up front or payments over time
and prevent a credit reporting, you can prevent credit damage.
Midland is one of the only debt buyers that does this.
So it's an opportunity early to limit the damage to your credit.
And they typically don't charge much, in my experience, more for
the settlement.
Look, you get this benefit,
we're not going to report to the credit.
They're going to settle with somebody for the same amount,
whether they report it on their credit or not.
So it's not like some carrot, other than,
of course, to get you to pay.
So once that happens, once you
are engaged in a dialogue with Midland to settle with them.
It's a case by case basis.
So as I've talked about in other videos and
throughout our website,
the fact is debt collectors can see certain things about you.
One of the main things that they can
see about you is your credit report.
And they use the intelligence that they get from your
credit report or other things that they know about you to
assign a collectibility score for all intents and purposes.
So, the higher you score, the more they are going to want to
collect from you, the less likely they are going to be to
go to lower settlement percentages.
And if it looks like a grenade blew up on your credit report,
shredded by shrapnel, you look like somebody who can't afford
to pay attention, I typically see them work with
those consumers and settle with them at a lower rate.
It's a realistic target, 40 and 50%.
All day long,
I see those kind of settlements get done with Midland.
So, I would encourage you to have an expectation of
those kinds of percentages.
Have I seen lower percentages?
Over the years, yeah, of course, okay.
Specifically, when they're working with somebody,
maybe in a fixed income situation, probably never gonna
work again, disability, those kinds of things.
And then I wanna jump into something before going any
further, is that Midland is also unique in that they publish
a consumer bill of rights, if you will, on their website.
And they talk about hardship scenarios.
What could you possibly fit?
What category of collectibility could you fit into where Midland
just says, okay, fine, we're just not gonna bother, we're
not gonna try and collect from you because of your hardship?
They have that, they publish it.
They talk a little bit about it.
It is essentially is what I just said, you're on a fixed income.
You are only on social security and have no assets.
So you're pretty much uncollectible if they were gonna
sue you anyway.
But if you telegraph that to them,
even after they've sued you, they back off.
Not many debt collectors out there in the country do that
now or have ever done that.
So it's kinda a cool thing that they do if you are into gauging
or grading debt collectors.
In that respect, Midland would get a high mark.
Now, let's assume that it's been two years since you paid
your credit card bill and, or
even they collect on a lot of unpaid phone bills.
Cell phone bills and things like that.
T Mobile, specifically.
And, you have this on your credit, and you want to try and
resolve it, because that was then, two years ago,
and things are better for you now.
So, you want to start to clean up your credit.
Midland, like anybody, when you negotiate a settlement and
you follow through and pay it, has to only,
according to the Fair Credit Reporting Act,
report up to date, current, accurate information.
So, don't make credit reporting part of your dialogue with
Midland like you care about it.
Don't even bring that into the equation.
Ultimately, if you settle, they're going to have to report
the fact that you don't owe them anymore.
Zero balance. I don't care if you paid a penny
or paid them in full, your credit report has to get updated
for the fact that it and reflect that it's been taken care of.
So, giving them any indication that you care about your
credit is also giving them an indication that maybe they
should try and get you to pay more.
Why am I focusing on settling with Midland rather than paying
the balance in full?
Because everything's already happened.
You fell behind with the original creditor.
It destroyed your credit.
Midland's on there or not on there.
It doesn't matter.
Your credit's still damaged.
It's already a charged-off account.
You do not get extra brownie points for
paying Midland everything that they're saying is owed.
You don't.
So, in my opinion, in my experience, it benefits you
more to negotiate the lowest possible outcome,
the lowest possible cost outcome to you.
So, that's basically negotiate what you can afford to pay and
what you can find that they're willing to accept from you.
Settle it and move on.
You may have other debts you're gonna be able to settle.
Maybe this is the only one you're dealing with or
the last one you have to deal with.
They're easy to talk to.
So, let's move on to that.
And when you call Midland's main number on their website or
you call the number that's found on the letters that
they send you, collection notices in the mail.
They're actually pretty easy to work with.
Just for a little bit of reference, frame of reference,
if you don't know who we are in the market place, or
who I've been in the market place, I advocate people try and
settle their own debt when and wherever possible.
And only engage the likes of a professional, somebody like me
or others, when you hit a brick wall, when you can't.
And because of that experience,
in fact, we built Consumer Recovery Network.
Our reputation is built on
coaching people through the settlement process since 2004.
I've got tons, and tons of data.
I mean, literally, every day I come in contact with Midland
customers trying to resolve a debt.
So I've got tons of information and
experience that I can draw from when I tell you that consumers
generally don't have that big of a problem
communicating with Midland to resolve their own debts.
You just have to know in advance that they can see
things about you.
If you're paying all of your other bills on time,
including other credit cards,
they're not going to want to settle for as low.
If you are dealing with massive collections,
your targets can be lower.
But once you get the deal done, get it in writing from them.
Sometimes they'll mail it or fax it.
They have different state laws that they have to meet, but
they will get it to you in writing,
period, before you make a payment.
And then, you can pay them.
You can pay them from your bank account.
You can pay them from a check that you send them in the mail.
You can pay them over the phone.
They are probably under the most scrutiny of any debt collector
out there, and more scrutiny than they've ever been in,
in their entire existence, because of regulatory,
both state and federal changes, and awareness.
There's a hyper-awareness around the collections base, and
has been for several years.
So, you can usually not fret too much about paying, but
be sure and get it documented first for your protection.
There are other things that I can bring up about Midland and
how to work with them.
If you want to talk with me,
you can reach me through the hotline, option two.
You can post comments below about your situation.
Things change dramatically if Midland sues you.
So, everything I've been talking about in Midland this and
Midland that, as soon as they sue you and
if they're using an attorney in their network, that changes.
Now, the attorney's involved and everything's different.
Now, you're dealing with a lawsuit.
And we have videos up about how to deal
with collection lawsuits.
While I don't have specific videos up dealing with
law firms, names of firms working in your state.
All the generalities in the videos and
on our website about dealing and settling debt once sued apply.
And Midland itself and their policies aren't necessarily as
much of a concern as it is dealing with the law firm.
So, look for those videos or post more about a Midland
lawsuit that you might be dealing with in the comments
below and I can give you feedback that way.
Or you can join the ongoing discussion that we have on
the CRN site.
I look forward to seeing you on the next video.
[MUSIC]