Collection letter became popular in the fifties. Before the FDCPA was in existence, practically everything was permitted in a collection letter. Collection letters still bring chills in the minds of people today. Ask people today what they would do if they get a collection letter and a lot of them will say, I either don’t open them or just throw them away.

Even though today there are standards that collection letters have to adhere to, each year thousands of people are scared to open them. Most people have this strange idea that collection letters will tell them that they will be sued and garnished. Due to this perceived threat, the collection industry recovers millions of dollars each year just by sending out letters.

Collection letters can range from very apologetic to aggressive. By apologetic, I mean a phrase such as If you have already sent in your payment please ignore this letter to one that says, if we do not hear from you we will continue with further collection activity. Here are some basics about collection letters that you should know.

• Open all collection letters. If you have more than one account in collections, separate them by date and by company. By doing this, you know exactly what is happening.
• 95% of the time if you owe up to $300 or less, no matter how aggressive a collection letter may sound, you probably will not be sued because the cost to start a lawsuit for such a low balance is too high. If you tick off a bill collector or are a famous person, a collection agency might start a lawsuit just to get back at you.
• If you get a letter notifying you that you are going to be sued, that does not mean that you are going to be garnished. You still have time to set up a payment arrangement, settle or pay of an account before your court date.
• If collections are down for the client that has your account in collections, they may send you a letter offering to settle for up to 50% of what you owe.
• If the collection firm is out of state, to sue you they have to get another firm in your state to do so. In general, if there is no response from you in four to six months, the creditor may send the account to another collection firm.

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