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Re: Asset Acceptance


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Posted by Paul (216.127.68.137) on May 11, 2004 at 19:26:22:

In Reply to: Re: Asset Acceptance posted by casey on May 11, 2004 at 01:48:55:

If you’d like insight into the junk debt buying extortion rackets, then read Asset Acceptance’s own SEC filing. They purchase accounts for 1.85 cents on the dollar and only ever collect about 6 cents on the dollar for all those accounts. The same business model applies for all the junk debt buyers. None pays more than a few pennies on the dollar for any of the accounts.

They purchase the assignable rights on millions of accounts. They don’t sue relatively often, but with millions of accounts, their victims show up regularly on this board. One would believe the likelihood of being sued by them just depends on one’s proximity to some sleazeball lawyer they have in their hip pocket.

As you could imagine, they don’t get much in the way of documentation for their 1.85 cents on the dollar purchases so they shouldn’t be too difficult to fight off in court if you request bundles of paperwork, signed applications, and detailed accounting; none of which they have so don’t admit to anything. If you make yourself more bother than you’re worth, they should drop the case.

Here’s one paragraph from their filing—

“We are a leading purchaser and collector of charged-off consumer receivables in the United States. We purchase and collect defaulted or charged-off accounts receivable portfolios from consumer credit originators, primarily credit card issuers, consumer finance companies, retail merchants and telecommunications and other utility providers as well as from resellers and other holders of consumer debt. We have been purchasing and collecting charged-off receivables portfolios since the formation of our predecessor company in 1962. Charged-off receivables are the unpaid obligations of individuals to credit originators. We generally purchase the charged-off receivables from credit originators and other sellers of debt that were unsuccessful in collecting the underlying debt; consequently, we are able to purchase these receivables at a substantial discount to their face value. We currently do not collect on a commission or contingent fee basis. Rather, we purchase and collect charged-off accounts receivable portfolios for our own account as we believe this is the best use of our resources and that this affords us the opportunity to maximize our profits. Since January 1, 1990, we have purchased 627 consumer debt portfolios through August 31, 2003 with an original charged-off face value of $13.2 billion for a purchase price of $245.4 million or 1.85% of face value. On average, we have been able to collect more than three times the amount paid for a portfolio, as measured over a five-year period from the date of purchase.”

Asset Acceptance
http://www.sec.gov/Archives/edgar/data/1264707/000095012403003334/k79644sv1.txt



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