Know Your Enemy: Midland Credit
by: Michael Creditfirm.
Midland Credit Management (MCM) also known as Midland Funding and MCM Capital is a subsidiary of Encore Capitol Group, Inc. Midland is a collection agency which purchases portfolios of defaulted consumer debt from banks, credit unions, utility providers, as well as many others at a severe discount.
In 2011, Encore Capital paid $386.9 million, to purchase $11.7 billion in debt. What does this mean to you? Midland buys debt at a 96.7% discount, so your $1000 collection was bought for $33.
In 2013, Midland Funding was fined for using illegal collection tactics to collect funds from 1.44 million consumers. They were ordered to pay $5.2 million to approximately 299,000 litigants, or $17.38 per person.
In response, Midland Funding created a “Consumer Bill of Rights” which includes:
- Contacting consumers in a timely and effective manner, resolving accounts quickly and honestly, and ensuring collection practices that promote settlement and preserve dignity;
- Establishing forgiveness and hardship guidelines, including the cessation of collection efforts when permanent hardship is demonstrated;
- Suspending interest or fees when a consumer is making timely payments on an established plan;
- Implementing the fair and reasonable use of litigation to resolve an outstanding obligation, and seeking to avoid litigation whenever possible; and
- Committing to not resell defaulted consumer accounts in the normal course of business.
Sounds nice, but how does this bill of rights actually protect you? It doesn’t. All of the points outlined in the bill of rights are for the purpose of being more efficient and effective at collecting debt and maximizing profits. Please keep that in mind when dealing with Midland Credit collection agency.
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