Debt Purchasers

[OPTIMIST12]

I have posted about this before but still cant get my head round it.

A number of my creditors have sold my debt onto Max Recovery. This selling on is administered by Eversheds. I am presuming therefore that Max Recovery pay Eversheds a fee.

If Max Recovery can make a profit (obviously they must do or they wouldnt do it!!!) even AFTER paying Eversheds their commission / fee why do the original creditors sell these debts on in the first place. Are they not just waving goodbye to money that will now go to a third party?

Why do the original creditors not hang onto the original accounts? There must be a reason but it is beyond my small brain. Obviuosly at the end of the day it makes no difference to the debtor - but I am just mystified.

[mikebdomain]

Its' all to do with cashflow, if they sell the debt today they can raise cash on the amount owed with no further administration costs.

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[Adam Davies]

Hi
I think that it may also have something to do with PR.I guess they don,t want debtors who they can no longer sell to using up their time
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Andy Davie
IVA.co.uk Spokesperson

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[OPTIMIST12]

Thanks for those replies.

I would love to know the actual percentage that companies like Max pay for the debt. I have read various guestimates but presumably the actual figure is a trade secret.