Debt Free News

Sale of debt portfolios up

December 18, 2006

This week, we have seen nearly $464 million worth in debt portfolios listed on several websites. This number has largely risen from $322.6 million that was being posted on the same locations just the week prior. Financial market experts say that many large deals are also actively in motion between bank credit card companies that are dealing first hand with long term purchasers instead of searching for would be bids on the debt.

We find that even though credit card paper still continues to be the bulk of the financial market, that other things such as higher education student loans, out of state paper, and even automobile deficits and utility paper have a large place in the market as well – they seem to be attracting more interest from would be consumers.

Other experts believe that banks have been holding back in 2006 because of their generated earnings. Additionally, banks’ collection rates have been strong, helping this situation along as well. You will find that many big banks are happy with their 2006 earnings, so many of them will not be pressed to dump bad debt to make their goals this month.

This alone could be a big player as to whether a supply projection on the market next year will take place. This will be totally true if banks believe they need the cash in a harder climate than this year has posed.

Even though we have noticed that credit card debt prices have been on an even keel, gains in price are most remarkable in automobile deficits and higher education loans.

Additionally we see a gaining appreciation of out of statute accounts as an investment, instead of being unattainable.

It seems the biggest single debt portfolio as of this week is on the website of Garnet Capital. This financial institution is selling off $280 million of debt from charged off consumer loans. Bidding for this debt portfolio ended last Thursday.

The National Loan Exchange (NLE) is also currently posting a $36.8 million debt portfolio from HSBC Mortgage Services in addition to a ten million dollar amount of debt from HSBC Mortgage.

We also see that another financial institution, WorldWide Debt Exchange (WDE), is selling off a $7.6 million credit card portfolio that contains just over 2,220 consumer accounts that are all charged off accounts aswell. Most of these chage offs are more than 3 years old (bids are ending on the 20^th. WDE is additionally posting an $11.7 million credit card portfolio with another 3,200 accounts that are also over 3 years old.

Anothet big debt portfolio sell off is posted on another website for a massive $47.8 million. This debt portfolio contains well over 16,000 consumer accounts that were charged off with typical balances of about three thousand dollars each.

What’s more, there is another noticeable sell off of $30 million offering Portfolio Management LLC on the Web. This sell off portfolio contains just about 12,000 accounts averaging nearly $2,500 in debt for each.

We see from certain statistics that states in the hot seat with charged off consumer accounts seem to be California, Ohio, Illinois, and Nevada.

Again, this is another debt free topic out readers need to watch because the fact that all of these (and more) debt portfolios are being auctioned off will affect our economy. While these staggering statistics show that you are not alone if you have credit problems, they do not make it acceptable to obtain a bad credit history. Just because you may have a charge off does not mean that the debt disappears. It will also stick to your credit report as well.

Basically, credit card companies will dump there debt portfolios off (the charge offs) to large collection agencies that will then assume the debts and still seek you out should you be one of theses accounts. Our debt tip to you – should you be one of these accounts – is to settle with the agency for 50 cents on the dollar. Meaning, if a company contacts you about an old charge off, you offer to settle the account for 50% of its total due.

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