Most collection companies buy debt on a spreadsheet, but not the debt. This article provides further explanation about the different types of collections.
About the phone calls. If a collection company gets you on the phone you need to firmly explain you do not want to talk with them, and to put your account into DMO (Direct Mail Only) status, and not call you again.
Be advised that some collection companies can be very aggressive to the point of filing a law suit. Should you be served papers with this notification, do not ignore this activity as you would certainly be given a Summary Judgment. A Judgment legitimizes the debt, can be renewed up to ten years, and usually gets an interest rate attached to it. The ability to negotiate the debt also pretty much goes away.
So your collection company claims they bought the debt. For the most part, they didn’t. What they bought was the opportunity to attempt to collect on a debt. In other words they bought leads that are backed up by a posting on your credit reports making them appear to be legitimate. These companies request the payment be made to their company. Exceptions to this are for Utility company debts; Link.
Fact is there are laws on the books that make creditors charge-off consumer credit to profit and loss any account after 180-days of non-payment. This provides a write-off on the taxes, and the IRS says they can’t double dip, therefore the debt becomes UN-collectable with the exception that if the creditor does receive monies for the debt, a tax return would need to be amended.
Another fact is that since they don’t have a signed agreement on their letterhead they have no right to your money.
We have developed technology that legitimizes this content, gets the collection companies to vacate their claims, and remove the records from the credit profiles.
Another type of collection seeks payment made payable to the original creditor. This makes them an agent. If they are reporting on the credit report they need to be handled much the same way as a Utility Collection.