20150417

Debt Collectors Charge Interest (satire)

Recently I talked with my new debt collection agent "Greg", and discovered the following:

He alleges that Rogers Mobility, is charging a daily interest that works out to 25% per year, thanks to compound interest. Actually, the collection agent that Rogers has retained charges interest. To avoid conflict with the debtor, a debt collection agent will remind him that the company he owes money to is charging that interest.

Indeed, the collections agent is besmirching the reputation of Rogers Mobility. Though it is doubtful that what the debt collector says to me in confidence will actually harm the reputation of Rogers Mobility, given the satirical nature of this blog entry.

Rather than be confrontational, I have decided to play along with Greg since the aim of debt repayment is to continue paying the debt off at the rate which the debt collector and I agreed upon (originally $100 biweekly - every two weeks).

So, I see no harm in letting Greg tell me a fib. He is only concerned getting me ot pay off the debt, not cause me to feel enmity towards the corporation that he represents.

According to Greg, the remaining debt balance I had calculated is $650 is incorrect. Due to compound interest, it is actually $900. That works out to a difference of $250 - which accumulated from November 14 to April 16 (130 days).

That works out to almost $2 a day of interest which gets incrementally smaller every day due to my bi-weekly payments of $100.

So I calculated how long before I am debt-free. it works out to almost 5 months. Once I make my ninth payment circa August 14, I just have to pay off less than $50 and the account will be closed.

My decision then is to increase my bi-weekly payments to $150, which will reduce the debt faster. Rather than waiting up to 5 months, I would be debt free in 14 weeks (3.5 months), with less than $50 to pay on the 14th week.

Rather than give a lesson on the math used to calculate debt, I turned to the solution of an online debt calculator.

https://creditcanada.com/node/30/done?sid=45622&token=6d95d4a74e3445fff9647a1816b32635


No, I didn't go to Credit Canada for help, nor is this a product endorsement of a company that negotiates an interest free debt management plan.

Here's the calculator itself: https://creditcanada.com/debt-calculator

After July of this year, I will have paid my debt to Rogers Mobility. It will another six years before my credit rating improves.

If you need to get your credit report, this URL is useful: http://www.cbc.ca/news/canada/how-to-check-your-credit-report-1.1185975. They have links to Equifax and Transunion to get your annual credt report.

Note: all dollar amounts mentioned in this blog entry are rounded up from the actual amount of debt owed. To meet my debts, I have doubled my work hours and even taken extra work with my employer.

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