People use these agencies for some reasons, so it is important to seek the advice and service of one that best suits your needs. Debt collection agencies can typically offer more help than what one might initially think. One of the most common questions when choosing between debt collection agencies is in regards to cost.
The Costs Involved
An agency should offer more than one option for payment to offer a more customized plan for you. Choosing the right option for your needs will help ensure better use of your debt collection agencies services.
A debt collection agency may offer a flat rate plan. These plans offer services for a set fee to keep your costs fixed. Within this plan, even more, customization may be available, depending on how often the services of the debt collection agency are required. You may be able to choose between monthly plans or even on an as needed basis.
No Win No Fee
One common payment plan that many debt collection agencies use is to collect debts with no fee. The purpose of this plan is to offer a low-cost alternative to other plans. If debts are not collected, typically no payment is required. If the debt collection agency does collect debts, they will then withhold their commission rate, which varies among companies and the amount of debt that has been collected.
Can The Debt Collection Agency Measure Up
It is important to determine if your debt collection agency can be customized for your needs, depending on the type of business you have and the amount and type of debt that you need to be collected. For example, landlords of both residential and commercial properties can seek the service of debt collection agencies to pursue overdue and unpaid rent. While it is common for landlords to be owed rent, it is important to be sure that your debt collection agency fully understands the details for completing the necessary paperwork and how to successfully collect the debt owed to you promptly.
I Have A Judgement But No Money
Perhaps you are owed a debt, so you have filed a judgment in an attempt to claim the money owed to you. To be enforced, the services of a debt collection agency that is experienced in this field may be required. A judgment does not collect your money, therefore, it is important to find a debt collection agency that understands how judgments work to get results.
Choosing Your Agency
A debt collection agency should be able to offer you a variety of choices when it comes to payment as well as customized plans to better suit the needs of your business. When it comes to collecting your debt, you will want results, and you will want them promptly. It is imperative to choose a debt collection agency that can provide all of these services while still being the best value.
Boosting In-House Debt Collection.
Recovering delinquent debt drains resources, and the recovery process often fails. With the time, money and workforce spent on debt collection, many businesses find it more appealing to hand off delinquent accounts to a debt collection agency rather than face the negative impact on the company.
Many businesses fail to note that in-house debt collection can be a rewarding endeavor if handled properly. Determination aids in the success of businesses' internal debt collection results and with some insight, can save a great deal of time and money.
The trick is to get started before the debtor is delinquent. Call the client before the payment due date as a reminder so that more of the individuals and companies with which business is done will make payments on time.
Don't wait until payment is thirty or more days late. Debt collection success requires making contact early on. Make the first call or send the first letter to collect the debt ten days after the payment due date. Doing both in conjuncture with each other drives home the necessity to pay, so call first, tell them they will receive a letter and send it immediately upon ending the call.
Being congenial on the first attempt to collect the debt achieves great results. However, as debt delinquency grows, businesses must be more adamant and firm in their stance to demand payment if they expect to see results. Without a final show of determination, it is highly likely that the debtor will ignore the attempts at recovery.
One way to increase the bottom line is to pursue smaller debts first. These are more easily recovered because it is more likely a debtor can pay the smaller sum immediately. Debt collection is a more difficult task with larger sums since these are often harder to gather and sometimes require working out a payment plan.
Cut off credit lines. For those in the debt collection process, it is necessary to restrict purchases to advanced payment options, meaning they are no longer extended credit by the company. Extending credit to clients with delinquent payments does not motivate them to pay the outstanding sum, nor does it drive home the insistence that all bills be paid on time in the future. If a debtor is unable to purchase needed supplies or services, they are more likely to find a way to pay the amount due.
A great deal of time and money can be saved in debt collection by working smarter and using a little common sense. By following a few simple rules, businesses can increase the amount of delinquent debt they recover while saving on the cost of doing so. Resolve and hard work can boost in-house debt collection significantly with the right attitude.