Debt collectors are now able to DM people in debt

[Donut417]

18 minutes ago, tikker said:

So going into debt is? That's the logic you were applying earlier. Like I said, the advice was not choose death over debt. Avoiding debt when you can is most definitely good advice.

You need debt to build credit. Credit is everything in the US. If you dont have credit then you can pretty much not finance anything and have to pay full for everything. Not sure too many people have $350,000 just laying around to buy a house. And with the way the housing market is, thats the cost of houses. Cheaper houses need lots of work. Due to shortages used cars are up in price, if you can find them. Obama cleared out much of the used car market with Cash for Clunkers. The whole US economy is built on debt is good, which is a problem in itself. I mean look at the government, its funded by debt. Own a Treasury bond? You own some of our debt. 

[Jtalk4456]

*laughs in no social media presence
*cries in corner thinking about my debt

Luckily with little to no social media presence, this won't really affect me. These are also only derivative problems from the debt problem, but holy heck this is STUPID in all sense of the word. This is just idiotic to a whole new level. they're basically inviting scammers to take advantage of more people. 

8 hours ago, linkboy said:

He's talking about California, even though this was a federal decision, which was a ruling done by the Consumer Financial Protection Bureau and approved by the Trump Administration.

 

It applies to every US citizen, not just ones living in California.

I assumed he meant the state of being in debt, not a literal state...

9 hours ago, wanderingfool2 said:

Expand on what you mean.  There isn't much of a vulnerability.  They aren't publicly allowed outing you (like posting it publicly), they aren't allowed going to a company and saying "hey let me send this message to this person"

Main vulnerability here is with scammers tricking people, but with regards to the points you made, you're assuming they follow the rules. that's not a wise assumption as there are countless stories all the time of how debt collectors illegally harrass people all the time, including big names like navient for student loans

[Master Delta Chief]

7 hours ago, StDragon said:

Not everyone can afford a University, nor should they expect to be entitled to one.

Why not though? Don't you think it's a good idea to give people a fair chance to learn more about what they want to do in the future or do you simply not care for that at all? Labour type of jobs (some of them at least) can be automized if done properly. It's just that the world is too greedy to do so as per usual. 

[poochyena]

1 hour ago, tikker said:

Debt isn't good.

False. Debt as a concept is very good. It allows people to buy houses and start businesses. There are many instances in which debt is BETTER than buying with cash. One instance is interest free debt. If a loan is interest free, then it is ALWAYS better to take a loan than to pay full in cash, and that is because of inflation. Over the course of months or years, the dollar amount will be the same for the payments each month, but the value will decrease, so you end up paying less for the product in real value.
Another example is investments. I have ~$5,000 in AT&T stock. It has a yearly dividend rate of 9%. That means if I want to buy something that costs $5000 and the interest rate for the loan is 5%, it would be better for me to take out the 5% loan than to sell the AT&T stock and buy the item up front.

Those two reasons above are why companies like Apple have billions of dollars in cash and billion dollars in debt. Eliminating all your debt and avoiding getting into debt as a priority is NOT always the best option. "Debt isn't good" is not good general advice.

I, with $60k+ in debt (house debt) am better off financially than any of my friends with $0 debt.

1 hour ago, tikker said:

If you buy something with a credit card that you technically cannot afford (again the TV exxample) and end up in debt, then you are a financially irresponsible person who is spending money they don't have and thus shouldn't spend.

Would you say if this person didn't go into debt, and instead went to $0 in his bank account, that it would be ok? Of course not. Its not debt thats the issue, its bad financial decisions. I had friends who would spend their money until their bank accounts went to $0. Debt has no relevance in whether someone is financially responsible or not.

[TetraSky]

2 hours ago, Donut417 said:

So you have to be homeless? Average rent in the Detroit area is $900+ a month. Thats for a one bed room apartment

To be honest, all you said other than the rent, sounds more like a US specific problem. We got public transports, cheap education and everything else right up here in Canada. Including living minimum wages that keeps going up every year instead of stagnating at the bottom for decades. I'm sorry your country is like that.

 

As for the rent, all I can say is if you can't afford rent by yourself, get roommates. You say a 1 bedroom is $900. Now surely a two bedroom is not $1800, right? It doesn't usually scale up double like that. Meaning you pay less when you get a roommate to split the rent on. That's also what it means to not live above your means. If you can't afford to live alone, don't. That's why I live with a roommate even though I'm in my 30s.

If you can stay with your parents longer, do so. Leaving the nest at 18 is the single most idiotic mistake many teenagers do these days in search of their "independence" (unless they have toxic parents), it just sets them back years until they can manage to get their life and finances on track.

[Donut417]

8 minutes ago, TetraSky said:

Now surely a two bedroom is not $1800,

No but rent goes up yearly, even more some times. If I can’t afford rent then there is no reason to move out if my parents house. The whole point of moving our on your own is to be own. At this rate I’ll never be able to move our on my own. Both rent and houses are out pacing wages. Eventually it’s going to get so out of wack that people will just give up. Funny enough MIT did a study back in the 70s that predicted the collapse of civilization by 2040 ish, I’d say we are on track. 

[williamcll]

17 hours ago, tikker said:

Attend university and you no longer have to imagine

Imagine needing to pay for school fees.

[wanderingfool2]

4 hours ago, Jtalk4456 said:

Main vulnerability here is with scammers tricking people, but with regards to the points you made, you're assuming they follow the rules. that's not a wise assumption as there are countless stories all the time of how debt collectors illegally harrass people all the time, including big names like navient for student loans

That's not a vulnerability, because guess what...scammers are already breaking the law, having it legal for real debt collectors doesn't really give the scammers more power.  It's like having a law saying bodycams on cops are required, and then saying but what if people claim to be cops because they are wearing a bodycam.  The simple fact is scammers can already do it, so it's pointless using it as a vulnerability.

 

I'm not "assuming" they follow the rules...I know that if they break the rules all you need to do is sue them.  i.e. If they call you 10 times a week, you have phone records and a lawsuit has stat. damages of  up to $1000 + court fees + lawyer fees + any damage if caused.  [Super simple to prove].

 

Same thing with contacting you via messaging.  If they break any of the rules, especially since it's a written form of communication you could just get them for breaking the FDCPA rules.  Anyways, most of the places you would be on have it so you can set only friends to message you...so you can simply set that and they won't be able to message you

[tikker]

9 hours ago, Donut417 said:

You need debt to build credit. Credit is everything in the US. If you dont have credit then you can pretty much not finance anything and have to pay full for everything. Not sure too many people have $350,000 just laying around to buy a house. And with the way the housing market is, thats the cost of houses. Cheaper houses need lots of work. Due to shortages used cars are up in price, if you can find them. Obama cleared out much of the used car market with Cash for Clunkers. The whole US economy is built on debt is good, which is a problem in itself. I mean look at the government, its funded by debt. Own a Treasury bond? You own some of our debt. 

I think your last two sentences sum up my feeling about such a system pretty well. I am aware and agree that people won't have $350,000 lying around to buy a house, but for me at least, when taking that loan, you consider that money gone for however long it takes you to pay it back, which ideally is as short a time as possible.

7 hours ago, poochyena said:

One instance is interest free debt. If a loan is interest free, then it is ALWAYS better to take a loan than to pay full in cash, and that is because of inflation.

How common are interest free loans though? They fall in the "if it looks too good to be true..." category. If you can get them they typically have conditions attached like only the first X month(s) or harsh penalties if you miss payment. If you're not financially stable they're mostly akin to playing with financial fire to my knowledge. Even our educational loans generally are not interest free, just super low interest.

7 hours ago, poochyena said:

Another example is investments. I have ~$5,000 in AT&T stock. It has a yearly dividend rate of 9%. That means if I want to buy something that costs $5000 and the interest rate for the loan is 5%, it would be better for me to take out the 5% loan than to sell the AT&T stock and buy the item up front.

Yes the math works out at first glance ,and you could probably even use your stocks as collateral. The downside is that you are assuming your assets will remain at similar value, which you can't predict. Your loan's interest will stay, while your stock may lose value. It's a risk assessment you have to make. Even in this case, the safest play would be to make sure you have $5000 (+ interest) already when you take out the loan, or soon after, such that you are sure you could pay it back when the debt matures.

7 hours ago, poochyena said:

Those two reasons above are why companies like Apple have billions of dollars in cash and billion dollars in debt. Eliminating all your debt and avoiding getting into debt as a priority is NOT always the best option. "Debt isn't good" is not good general advice.

"Debt is good" is equally bad advice then. Tell that to the hundreds of thousands of people you quoted earlier that are in financial trouble because of medical debts.

 

This has gone off the tracks a bit. Debt is only "good" as long as it doesn't exceed your financial ability to pay it back or when you expect to make more from it than the loan+interest cost you (or when you like to hold influence over an entity). Obviously loans for houses, education etc. concern amounts of money that likely no average person will yield, especially at younger ages, and clearly are different beasts. This was never the point. If you go into debt because of a stupid TV then you are making an irresponsible decision. That is not a "good" debt. The only reaons education and house debts are "good" debts is because they offer a basic life necessity and a potentially better financial situation allowing you to pay off that debt.

 

Apple and such have billions in debt because the system is setup in a way in which a massive debt makes them the most money. They still have a due date. Apple nearly went bankrupt because of debt in the 90s.

Quote

I, with $60k+ in debt (house debt) am better off financially than any of my friends with $0 debt.

You're not better off simply because you are $60k in debt with the bank for a house. The only valid comparison of being financially better off would be if you and your friends had the exact same assets and you took a loan while your friend paid out of pocket. If both of you started with $100k (identical income, expenses etc. otherwise) and you took a $60k loan to buy the house and your friend paid it themselves. You both live comfortably, who is better off? Your friend will have $40k in savings, an income they pay the bills from and no other obligations. You'll have an apparent $100k in the bank, but have to pay an additional monthly settlement for the loan, and technically also only have $40k in the bank, because you owe the loaner that $60k. Your situation hignes on the assumption that your income will remain stable such that the montly settlement is affordable. You'd be better off in the sense that you have $60k more immediate capital to tap into should an emergency arise, but if your income falls away and you had spent that $60k as if you had an extra $60k you would be worse off depsite that "good" debt.

 

This is again beyond the original point. Buying a house is completely different from buying a TV or similar, which we both agree on. It's a convenient system, I'll agree on that. It hinges on assumptions of stability, which in general may be true, but there are very real risks with debt. This pandemic is a perfect example of what happens if you take that stability away.

8 hours ago, williamcll said:

Imagine needing to pay for school fees.

Up to secondary school is free here. Higher education is where it stops.

[Stahlmann]

13 hours ago, Donut417 said:

Maybe its the most used method. I use my debit card most of the time. Some people are just bad with money. I use my credit card only when I know I have the money to spend. The issue is you have to have credit to do anything in the US. Need to buy a car? They are checking the credit report. Want to buy a house or lease an apartment? Credit report. Need a loan? Again credit report. Most people have credit cards to build credit. 

Just goes to show how different it all works across different countries.

[poochyena]

3 hours ago, tikker said:

How common are interest free loans though? They fall in the "if it looks too good to be true..." category. If you can get them they typically have conditions attached like only the first X month(s) or harsh penalties if you miss payment. If you're not financially stable they're mostly akin to playing with financial fire to my knowledge. Even our educational loans generally are not interest free, just super low interest.

3 hours ago, tikker said:

Yes the math works out at first glance ,and you could probably even use your stocks as collateral. The downside is that you are assuming your assets will remain at similar value, which you can't predict. Your loan's interest will stay, while your stock may lose value. It's a risk assessment you have to make. Even in this case, the safest play would be to make sure you have $5000 (+ interest) already when you take out the loan, or soon after, such that you are sure you could pay it back when the debt matures.

You're really missing the point and over analyzing the specific details that are irrelevant to the broader discussion.

 

3 hours ago, tikker said:

"Debt is good" is equally bad advice then.

Correct. The type of debt is what matters.

 

3 hours ago, tikker said:

You're not better off simply because you are $60k in debt with the bank for a house.

Yes, thats the point, that debt plays no role in how financially well off I am.

[Jtalk4456]

13 hours ago, wanderingfool2 said:

That's not a vulnerability, because guess what...scammers are already breaking the law, having it legal for real debt collectors doesn't really give the scammers more power.  It's like having a law saying bodycams on cops are required, and then saying but what if people claim to be cops because they are wearing a bodycam.  The simple fact is scammers can already do it, so it's pointless using it as a vulnerability.

 

I'm not "assuming" they follow the rules...I know that if they break the rules all you need to do is sue them.  i.e. If they call you 10 times a week, you have phone records and a lawsuit has stat. damages of  up to $1000 + court fees + lawyer fees + any damage if caused.  [Super simple to prove].

 

Same thing with contacting you via messaging.  If they break any of the rules, especially since it's a written form of communication you could just get them for breaking the FDCPA rules.  Anyways, most of the places you would be on have it so you can set only friends to message you...so you can simply set that and they won't be able to message you

I fail to see your logic here. Your example proves my point perfectly. bodycams on cops once made normal are therefore recognizable and less suspicious. 20 years ago and you see someone on the street wearing a uniform and a camera on their shirt, that's freaking suspicious and you might call the police to report suspicious activity. Seeing it now, it's normal and you don't give a single thought about it. 

Same thing with this. Up until now, debt collectors contacting through social media is unheard of and seeing it will raise suspicion of a scammer to anyone with some common sense. Now that this will be the new norm, people will assume more legitimacy if a scammer contacts them on facebook. A week ago, If someone contacts me on fb demanding payments (good luck i'm not on fb), I know they are a scammer, because that's not a real thing. Now it's a real thing, so I no longer know if it's real or not. While I'm tech savvy and would not give a second of trust to anyone asking for money in my DM's, there are many more vulnerable populations that would not be wary right away and would be too scared of their debts and might comply and get scammed. Making a bad behavior normal lends legitimacy to illegitimate actors. that is the vulnerability. This is just letting scammers be harder to weed out. 

As for suing them, that's highly idealistic. In reality, they often get away with it. The average person does not have the resources to bring a lawsuit against a multimillion dollar national financial institution. And again providing them more ways to be bad, even if in theory you can get them in trouble, is still a bad idea.

[wanderingfool2]

9 hours ago, Jtalk4456 said:

As for suing them, that's highly idealistic. In reality, they often get away with it. The average person does not have the resources to bring a lawsuit against a multimillion dollar national financial institution. And again providing them more ways to be bad, even if in theory you can get them in trouble, is still a bad idea.

You get lawyers fees, you could be flat broken and still be able to take on a major company.  Like literally all you would have to do pretty much is bring it into a lawyers office and say "hey they called me 14 times in the last week, here are the phone records"; and I bet you could easily get a lawyer that would fight it on a contingency of winning.

 

If you are naive enough to fall for a scam on something such as messenger then you are equally as likely to fall for the scams via phone or via mail...also it really doesn't make too big of a difference whether it's legal or not, because most people I bet prior to seeing this wouldn't have known if someone could or couldn't contact you like that; and those who would google search it would also not be falling for a scam.

[tikker]

21 hours ago, poochyena said:

You're really missing the point and over analyzing the specific details that are irrelevant to the broader discussion.

A discussion which started with overthinking a general saying.

21 hours ago, poochyena said:

Yes, thats the point, that debt plays no role in how financially well off I am.

That's not completely true. It's merely that just knowing only someone's debt and nothing else doesn't allow you to derive much, just like knowing only someone's income or that someone owns a house tells you nothing. Debt impacts your finances. It takes away from your disposable income, limits the subsequent loans you can get and if you fail to meet payments it can rapidly grow out of control.

 

It's one of those situations that are only "good" if you can already take the hit in the first place.

[Jtalk4456]

10 hours ago, wanderingfool2 said:

You get lawyers fees, you could be flat broken and still be able to take on a major company.  Like literally all you would have to do pretty much is bring it into a lawyers office and say "hey they called me 14 times in the last week, here are the phone records"; and I bet you could easily get a lawyer that would fight it on a contingency of winning.

 

If you are naive enough to fall for a scam on something such as messenger then you are equally as likely to fall for the scams via phone or via mail...also it really doesn't make too big of a difference whether it's legal or not, because most people I bet prior to seeing this wouldn't have known if someone could or couldn't contact you like that; and those who would google search it would also not be falling for a scam.

Highly disagree on all points, these companies have lawyers at the ready at all times and rarely get consequences now for their illegal collection practices, this will be no different. You're right about the type of naivety being naive in all types, which is exactly why we shouldn't open up other avenues of scam. That's again just asking for more scammers. And I would argue many people would assume social media to not be a normal contact method and wouldn't fall for it now, but might when it becomes normal. It's widely known that mail phone and email are main forms of contact. I can't think of a single person I know that would assume social media to be a normal allowed method. This is a very out of the ordinary method and serves no purpose but to further allow illegal harassment and scammers

[rrats]

On 12/3/2021 at 5:01 PM, wanderingfool2 said:

Expand on what you mean

Scams

[wanderingfool2]

3 hours ago, rrats said:

Scams

Scams are inherit to everything, adding this doesn't really add much of a vulnerability...as there isn't anything preventing people from already pulling off that scam.  Examples being that despite the introduction of new rules to help prevent spam calls in Canada I still get tons of emails saying this.

 

Or the emails regarding "over draft" from the bank, despite the fact banks telling people they would never contact you like that.  It isn't right to characterize it as "tons of vulnerabilities" as I doubt it will even create more cases.  On the other hand, it does allow debt collectors to pursue people through a means when the person doesn't have a phone and no listed address.  I know someone exactly like this, no phone (or always using a burner) and no fixed address; but always is on social media still.

[omegatotal]

On 12/3/2021 at 5:42 AM, Stahlmann said:

Without trying to be politial or offensive i think being in debt is part of the US "lifestyle" so to say. I think in the USA credit cards are the single most used method of payment. So basically everything they buy is debt in the first place.

 

I have once used a credit card, but only because the online store didn't accept anything else. I never understood the point of the credit card juggling americans do in the first place.

 

But some things you just cannot afford without taking a credit. Most people could not buy or build houses from their monthly income and saving up alone.

 

Its not a lifestyle, its the banks and credit monitoring orgs having worked the system in such a way that using cash or debit cards/checks instead of credit lines generally costs you more, and they con you into getting into debt with credit cards because you have to have good credit history to get approved for buying a house(unless you have many zero's behind a 1-9 in your checking or savings account to drop on the house), or renting.

But the only way to get a good credit history is to have debt and maintain that debt so they can continue to charge you.

[omegatotal]

On 12/5/2021 at 6:26 AM, tikker said:

A discussion which started with overthinking a general saying.

That's not completely true. It's merely that just knowing only someone's debt and nothing else doesn't allow you to derive much, just like knowing only someone's income or that someone owns a house tells you nothing. Debt impacts your finances. It takes away from your disposable income, limits the subsequent loans you can get and if you fail to meet payments it can rapidly grow out of control.

 

It's one of those situations that are only "good" if you can already take the hit in the first place.

But you have to have some history of having debt either via a loan or via a credit card type account with some level of balance on it below some arbitrary number that is shrouded in algorithms that you cant see to have a good 'score'.

in fact, you could have a credit card or two, and a car loan, everything have perfect payment history, pay off the car loan and drop 50-100 points for no reason other than the number of active accounts changed.

[Zodiark1593]

On 12/4/2021 at 4:01 AM, tikker said:

Stuffs

Debt can be a useful tool to control more assets than you can actually  buy in cash, and thus benefit from appreciation (or hit hard for depreciation). Used judiciously and with careful risk management, debt can certainly help in accelerating wealth building and in starting small businesses, though irresponsible and irrational use can lead rapidly to a bad financial situation. Grade schools are sorely lacking in financial education.

 

Medical debt however, can go straight to hell. It's my opinion that debt should require either explicit consent from an able-minded (ie: not under influence of Any drugs) person to be collectible, or court rendered judgement. If there's no formal contract signed by a lucid and clear-minded debtor, there should be no debt.

[TetraSky]

37 minutes ago, valdyrgramr said:

Well, I keep getting harassed to pay someone's medical bills who had my number before me.  I'm also still be harassed by debt collectors to pay for an account that a bank, yup Wells Fargo, opened in my name when I turned 18.  e.e  It's not always because you owe money, but in the US many debt collectors are parasites who don't care if you actually owe them anything.  They will harass you illegally.  FFS my insurance covered a bill entirely, and a collector keeps asking me for more money.  <.<

The US sure sounds like a bad place to live in the more I hear about it.

[Donut417]

Just now, TetraSky said:

The US sure sounds like a bad place to live in the more I hear about it.

It is. If you get sick bad, be prepared to declare bankruptcy. Crippling student loan debt? Well bankruptcy doesnt work on those so your just fucked. Cant afford a house? Well you most likely will need at least 2 jobs to afford rent. Dont have good credit? Expect to pay more. We are about a step and a half away from economic collapse. The housing market is in a larger bubble than it was in 2008. We have issues with our criminal justice system. We have a lack of respect for the law in our citizens. We have massive amounts of other societal issues that continue to cause havoc. Our government is more concerned with issues else where, than the issues we have he at home. 

[tikker]

10 hours ago, omegatotal said:

But you have to have some history of having debt either via a loan or via a credit card type account with some level of balance on it below some arbitrary number that is shrouded in algorithms that you cant see to have a good 'score'.

in fact, you could have a credit card or two, and a car loan, everything have perfect payment history, pay off the car loan and drop 50-100 points for no reason other than the number of active accounts changed.

So in that case you're actively being penalised for not having a debt? Not sure if open debts weigh in on getting new ones for you, but here the less debts you have the better. If you have a recorded history of constantly missing payments then they'll also be less willing to give you a loan, and if there are other debts the loans you can get will be (significantly) reduced.

8 hours ago, Zodiark1593 said:

Debt can be a useful tool to control more assets than you can actually  buy in cash, and thus benefit from appreciation (or hit hard for depreciation). Used judiciously and with careful risk management, debt can certainly help in accelerating wealth building and in starting small businesses, though irresponsible and irrational use can lead rapidly to a bad financial situation. Grade schools are sorely lacking in financial education.

That's what I meant with it being convenient. Going in debt because you buy a TV would fall in the getting hit hard by depreciation category and would be ill-advised. Buying an appreciating asset you'll take on a certain amount of risk that that asset will appreciate and you'll then be able to pay back. That is, as you say, not something to be done on a whim though.

[Franck]

On 12/3/2021 at 2:22 AM, rrats said:

Creditors in US and CA

Where does it state canada anywhere in the articles ? All it state is USA

[Beskamir]

On 12/3/2021 at 12:57 AM, 5Beans6 said:

It really amazes me how people still choose to live in that state.

They don't have a choice? Moving costs money and requires rebuilding your entire social network.