As we’ve often discussed, student loan debt collection is big business. Debt collection agencies covet Department of Education contracts, and the government has contracts with 17 large debt collection agencies and five small debt collection agencies. But there’s something wrong with the system. The Department of Education gives each student loan debt collection agency a score, and uses those scores to award quarterly and annual bonuses to the debt collection agencies. The scoring is weighted, giving debt collection agencies that collect the most money the biggest boost (70 out of 100 points). Only ten points are awarded for high performance in administrative resolutions. The remaining 20 points are awarded for total accounts serviced.
This point system and related bonuses don’t provide incentives for debt collectors to inform consumers about the federal programs that enable borrowers to obtain deferments and forbearance (see http://www.direct.ed.gov/postpone.html), or to participate in loan consolidation or in the “Pay as You Earn” program (see http://loanconsolidation.ed.gov/).
Debt collection industry publication InsideARM published the performance scores and amounts collected by student loan debt collection agencies for the quarter ending September 30, 2012. The amounts collected are astounding:
Pioneer Credit Recovery – $48.2 million
ConServe – $44 million
Van Ru Credit Corporation – $42.3 million
FMS Investment Corp – $41.6 million
NCO Group – $40.4 million
GC Services – $40.2 million
ERS – $37.7 million
Diversified Collection Services (Performant) – $37.1 million
Premiere Credit of North America – $35.4 million
Allied Interstate – $31.5 million
Progressive Financial Services – $30.7 million
EOS CCA (Collecto) – $30.5 million
Account Control Technology – $30.4 million
Windham Professionals – $29 million
Financial Asset Management Systems – $26.4 million
CBE Group – $24.7 million
West Asset Management – $20.3 million
Coast Professional – $21.9 million
Collection Technology – $17.8 million
National Recoveries – $13.5 million
Immediate Credit Recovery – $13.5 million
Delta Management Associates – $11.8 million
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If you have been the victim of harassment or illegal or unfair debt collection practices, contact the Fair Debt Attorneys at Lemberg & Associates immediately to discuss your options and protect your rights.
Is there any agency (central data base) where someone can locate the history of the student loans and the journey they take since every agency seems to refer to another, etc. The original loan provider refer the student to the collector. The collector refers the student back to the originator and no one seems to have any documents supporting the justification for the charges added to the student’s loan. Also, who can one go to to have they documents reviewed that have been provided by the collector that would support the interest, fees, applications of payments to principle as no one can seem to locate any of the original documents. We are in the pathway of the tornado, i.e. 6/1/2011 and many documents have not been located. All efforts to obtain them from the original loan agencies have not been successful and all the collector provides is a history of int charged, fees charged, little or nothing of the several thousand dollars charged having been applied to the principle and continuing mounting debt.