The nastiest check I ever dealt with was a foreign check in US Dollars. [This was about ten years ago.] It had to be sent by my bank to the issuing bank for collection because no US clearinghouse could cash it. They were going to charge me $75 US to cash a $300 check. [The check had been rejected by the normal processing system and they were going to give it back to me if I didn't want to pay the $75] The bank manager was nice to me because I was a regular customer and cut the fee to $35 on her own authority.

Some banks give the managers power to waive fees and do things to make customers happy; I have been a loyal customer at that branch ever since (The same manager has helped me with problems and fees a few other times).

Send in 5 cents and demand a refund of 1 cent.

@lehrdude: I hope you picked that penny up with a rubber glove

@yentaleh: Nicely played

The problem isn't with existing customers, because any short in a payment can simply be added to the bill for the next month.

The problem is with ex customers. Where the amount you spend on postage to tell them that they have a balance due is more than the balance itself (IE, you would have saved more money by not sending the notice in the first place).

Yay for the state of Pennsylvania selling a debt that was a clerical error on their end!

if( $amount_due > 0.00 ) {
attempt_to_collect( $amount_due );
}

Target once called me at 8.30AM on a Saturday in an attempt to get $0.10. The lady started with her "hello, this is Target" before saying "you owe... wait, nevermind, this call just cost the company more than you owe."

Even better: a few months later Target informed me that I never owed anything to them.

Watch out for dormant account fees.

My school held onto mailing out my diploma until I paid my $3.25 library fine. I just totally forgot about it until it was 5 months after graduation and my parents were accusing me of not really graduating since there was no diploma to show for it. I asked a friend still attending the school to take care of it for me. Still, better off than a collection notice.

Since collection agency weasels buy debt for pennies on the dollar, I wonder how much they paid for this debt? Maybe as much as $0.005?

Conservative/liberal/chickenhumping/whatever, it's something that no one really has posited a good argument against. ;)

You people are slipping!

[www.comedycentral.com]

The ones that did complain the most were the ones getting a reinstatement fee after service was cut off for non-payment of their bill. Usually this was their 3rd or 4th time having this happen.

@aguacarbonica: You mean like the late fees on your credit card, or the late penalties on your mortgage or rent payments? Or or any other fixed cost late fees you may or may not be charged?

Many companies wait till they can ding you with the late fees before they send out a nother notice, as there's usually no sense in sending out a second notice before the first one is even due.

I think a better policy would be "don't buy debts less than $20" or have an internal policy of "don't send out notices for accounts whose current balance is less than $1"

Two words -- ass pennies.

Problem is, I'm sure someone has already patented that idea, and and they are just waiting for you to get rich to sue you.

@Dooley: "Just how do you collect $0.00"

Send a drawing of a spider?
[consumerist.com]

I don't any receivables manager who would do this. Letting your customer go on invoice you intend to collect on, no matter how small, is a sloppy collections practice. I think you decide if you're going to collect on it (and continue to notify the customer) or write it off and be done with it.

"We notice that your account has become past due in the amount of $0.00, and is now zero days late."

with the obligatory words at the bottom, "This is an attempt to collect a debt, any information obtained will be used for that purpose"

Just how do you collect $0.00

The payments would go to a lockbox service (probably not the collection agency) who does nothing but process payments for clients. Probably a dozen different kinds of payments. It's highly efficient and makes no large difference to them if it's Postal money order or a check.

Now, a non-Postal money order -the oddball kind sold by gas stations or grocery stores- CAN be a pain to cash. Nobody will take them.

Several years ago I had a store credit card on it that somehow ended up with a credit of $0.01 on it. for two tears, once a month they sent me a statement alerting me that I had a $0.01 credit on the card. The store was ultimately bought and merged into what now is Macy's and they finally figured out that I no longer needed a statement every month telling me that they owed me a penny.

There's a cost for processing the data that produced the invoices (software, servers, data connections, labor). Then a cost for someone to print it (labor, printing machine costs, paper), then a cost for someone else to put it in the envelope (envelope costs, plus more machine costs, plus the postage), probably a QC person to check it, fuel to truck that mail to the Post Office, and then it finally gets in the mail.

All of the costs to process, print, finish, and mail are higher if the collection agency does that themselves, and lower if they outsource it to a mailing company. I work for such a company.

The postage is probably about half the total cost of producing these statements.

And of course, ALL of this is more than the past due balance. Insane that they sent four of them. Smart billers filter their data to remove stupid balances like this. They've probably spent a total of $3.00 to collect 4 cents, for which they paid effectively nothing to the original Doctor office. What a waste.

if( $average_collection_percentage * $amount_due < ( $mailing_costs + $perunit_overhead_costs + $collector_commission_rate * ( $amount_due * $average_collection_percentage ) ) + $profit )
{
$buy_debt = FALSE;
}

And more seriously, it can be solved by summing up all the short payments, and when it gets over a certain number, mail it out.

Automation can always be customized to prevent this from happening if a value is less than a certain amount.

@GitEmSteveDave_IsTheStig: In this case, I'd advise the "debtor" to tape four pennies to the bill and send it "postage due".

I suspect the aforementioned CFO would love to talk to..er..at the collections agency about reducing postal costs. :)

Why the collector was even talking to me, instead of the true debtor, is also against the law, and I told the collector that too. She wasn't impressed with that either. I think she was convinced I was the debtor.

At any rate, I told her the phone call was over, she was talking to the wrong person, and she would have to sue me for the money. The same company called a few times after that but I hung up every time, as soon as I realized who it was (they were gaming caller ID, too, which is also not legit). Eventually they stopped calling.

@aaron8301: I'm pretty sure money orders can be deposited just like checks, which a collection agency should be used to handling.

@PLATTWORX: If a company had an official policy not to send a bill if the balance was under a certain ammount, customers would start shorting their payments.

It will end up costing them about 500 times the amount of the original debt, to collect the original debt. I'm such an ass when I have to deal with incompetence.

When the government wants to collect, they have the power to arrest you and/or seize your assets. With the private industry, they would at least have to go through lengthy drawn out proceedings in court to get to that point.

Oh, and by "no such person there", I mean that no such person was employed there, not simply that she was out, as the agent indicated. I'm not *that* much of a jerk.

Coulda, been really nice and sent them the "mint" as well.

I once got hit with a collections call for TWO cents. I discovered that my money order to pay the cable bill was short, and tossed a couple of pennies into the envelope, which apparently didn't get counted. During the call, I exchanged some heated words with the collections agent, including some suggestions as to what she could do with her no-doubt well-earned commission on two whole cents.

I saw that I was getting nowhere with her, and asked what her supervisor's name was. She replied "she's not here,". "Nice," I said, "but that isn't what I asked. What's her name, please?" She told me the supervisor's name was Ms. Johannsen. I confirmed the spelling, called back, and lo and behold, there was no such person there. I asked to speak to any avilable supervisor, and explained my story to her. At the end of the day, the "debt" was retired, and I got written confirmation to that effect, as well as a written apology from the agent who'd lied to me.

I received a bil from Konica-Minolta for a copier lease for $.01. I taped a penny I found on the floor in the men's room to the invoice and sent it back in the prepaid envelope they conveniently sent me to return with my payment.....

Contacting the collection agency brought promises to remove me from their mailing list which materialized four years later. No skin off my teeth, they spent $15 trying to collect on a $0.00 debt and it didn't show on my credit report. For giggles, I did mail them a check for $0.00 but it never cleared.

@PsiCop:
Anytime a collector calls me I inform them I don't deal with any type of personal information over the phone. If they think I owe them money, they'd better send me something in writing.

Inevitably, they end up asking for my mailing address. Well, if you claim I owe you money, isn't that something you should already have?

@henrygates:
So they'd rather put a ding on your credit than send you a letter for a debt you probably would have just paid? Sad.

I'm surprised business haven't tried to add mailing costs for late notices to the fees owed.

From now on I'll @PLATTWORX: The problem with doing this is it sets up a perverse incentive for everybody to always pay $2 less than the actual amount they owe.

# Business logic fix
if ( $amount_due < $mailing_costs ) {
$pursue_payment = FALSE;
}
# Send my fee to the OP, thank you.

It is so simply in most AR software, to tell it to never generate an invoice for a balance under a number you choose ($2?) You can then do a "small balance writeoff" and wipe away the debts to small to bother with.

Another reason Healthcare in America needs reform!

I received a bill from Qwest for $.78 after I cancelled their crappy service. I paid it and included a note on their invoice to tell them how stupid they were.

I'm not sure if they'd have sent me to collections if I hadn't paid it - they probably would have.

Fun times.