From the smallest start-ups to the largest corporations, successful businesses have known for years how indispensable a good collection agency is. This is especially salient in business sectors where debt default runs rampant—such as in the credit card, banking, and medical industries.
Obtaining a reputable debt collection agency provides many benefits:
- Debts are collected in a much more efficient and timely manner
- Your company expends far less time, energy, and resources to collects debts
- Hiring a collection agency helps your business’s staff remain productive in growing the business, rather than stagnating with delinquent customers
- Statistically, companies that employ a third-party to collect debts are 60% more successful at collecting old debts than companies who do not.
Collection Agencies: The Good, the Bad and the Ugly
Two of the most dreaded words among many consumers are ‘collection agency’. They are, perhaps, rightly feel this way because collection agencies have a long history of using disrespectful tactics. As a result around 1980, the Fair Debt Collection Practices Act (FDCPA) emerged under 15 U.S.C. § 1692 et seq. as a part Consumer Credit Protection Act (CCPA). The FDCPA outlines approximately 12 specific rules regarding how collection agencies can and cannot treat indebted consumers. For example, one guideline contends that no debt collector may call a debtor between the hours of 9 P.M. and 8 A.M., while another states that “abusive or profane language” is strictly unacceptable. Regardless, there still remain some debt collectors that do not adhere to these regulations.
That’s why it is vital for your business that a reputable debt collection agency, like AccountsReceivable.com, be used. Reliable agencies only employ in-house agents instead of contractors. Why is this important? Contractors are rarely trained in the rules and regulations of debt-collection and as a result, often do not abide by the rules.
What’s at stake when debt collectors break the law? First, the debt collection agency or contractor can become directly liable for potentially, tens-of-thousands of dollars in fines and even more in lawsuits. This can also prove to expose your business to unwanted legal issues. In these types of instances a collection agency can do more harm than good, especially when they charge excessive fees: 50% for every recovered debt is not unusual. Organizations like AccountsReceivable.com understand this. That is why they employ ONLY highly-trained professionals to get the job done.
Professional and successful collection agencies follow legal rules and ethical guidelines, while at the same time, employ proven tactics that maximize debt recovery. The following is a good summary of the process that is commonly used:
- Three to four letters are initially sent to the debtor in an attempt to recover the debt(s).
- If unsuccessful, a series of almost daily phone calls are placed to the debtor for up to a month.
- Then, as a last-ditch resort to minimize additional costs for the client, an affiliate civil attorney is contacted.
- Attorneys know jurisdiction restraints in collection attempts and lawsuits better than virtually anyone.
- The affiliate attorney carefully considers all possible options for a successful resolution to the delinquent account.
Typically, the collection agency will perform its due-diligence to collect at least a portion of the debt before moving to contact an attorney. Why? Because attorneys are not cheap—and this can add to our client’s expenses.
Businesses often need a good collection agency before they even realize or will admit it.
Business may be great and customers that default may be few and far between, even non-existent at times. However, while this is certainly a favorable environment to work in, the current economy is, at best, extremely unpredictable. Do you have a strategy in the event the economy takes a downward turn or your customers begin to default in large numbers?
A respected, proven firm like AccountsReceivable.com understands that companies generally do not enjoy contemplating added costs such as hiring a collection agency. That is why a reputable firm will have flexible options and reasonable fees. Take, for example, AccountsReceivable.com : they offer two options:
1. The client pays a reasonable fee for every recovery and if no recovery takes place, the client owes nothing,
2. The client pays a low, flat monthly fee for every four debtors that are taken-on by the collection agency.
Recover what’s owed for your products or services-rendered. Do it as cost-efficiently as possible and consider a debt collection agency.
To get started today, call us at 321-710-3530 to speak with an associate