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For debt collectors, the dead are a healthy bet

New York Times News Service

MINNEAPOLIS — The banks need another bailout and countless homeowners cannot handle their mortgage payments, but one group is paying its bills: the dead.

Dozens of specially trained agents work on the third floor of DCM Services here, phoning the dearly departed’s next of kin and kindly asking if they want to settle the balance on a credit card or bank loan, or perhaps make that final utility bill or cell phone payment.

The people on the other end of the line often have no legal obligation to assume the debt of a spouse, sibling or parent. But they take responsibility for it anyway.

"I am out of work now, to be honest with you, and money is very tight for us," one man declared after he was apprised of his late mother-in-law’s $280 credit card bill. He promised to pay $15 a month.

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Dead people are the newest frontier in debt collecting, and one of the healthiest parts of the industry. Those who dun the living say that people are so scared and so broke it is difficult to get them to cough up even token payments.

Collecting from the dead, however, is expanding. Improved database technology is making it easier to discover when estates are opened in probate court, giving collectors an opportunity to file timely claims.

But if there is no formal estate and thus nothing to file against, the human touch comes into play. New hires at DCM train for three weeks in what the company calls "empathic active listening," which mixes the comforting air of a funeral director with the nonjudgmental tones of a friend. The new employees learn to use such anger-deflecting phrases as "If I hear you correctly, you’d like ..."

For some relatives, paying is pragmatic. The law varies from state to state, but generally survivors are not required to pay a dead relative’s bills from their own assets. In theory, however, collection agencies could go after any property inherited from the deceased.

But sentiment also plays a large role, the agencies say. Some relatives are loyal to the credit card or bank in question. Some feel a moral sense that all debts should be paid. Most of all, people feel they are honoring the wishes of their loved ones.

Finally, of course, some of those who pay a dead relative’s debts are unaware they may have no legal obligation.

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