Steve Harms

Friday, November 22, 2013

Why do I need a collection professional for debt collection?


To answer this question, often asked by clients and sales prospects, the following comments may be helpful.

 
Debts which are six months old only have a 50% chance of being collected.  Once a debt is 12 months old, you’re lucky if it has even a 10% chance of being collected. The older a debt gets, the more uncollectible it becomes.  A debt is not fine wine and it doesn’t become more enchanting with age.

 
 If a debtor has broken numerous promises or is just simply refusing to honor a commitment, it just may be time to bring in a professional to assist in the collection process and to take it to the next level.

 
During difficult economic times, you may even be facing a situation where a number of debtors are breaking promises and your accounts receivable are building to uncomfortable levels.  It just may be time to bring in a professional to handle your collections so you can move onto your other responsibilities.

 
You need to know who to hire, how to find debt collecting professionals, what to look for in terms of credentials and ultimately how the system really works so you can get your money’s worth.

 
A collection specialist who is who we look to when we are at wits end.  In the credit and collection business, wits end is usually arrived at following a series of broken promises.

 
Far and away the biggest mistake credit executives make is to wait too long before engaging collection professionals.  Whether the debt is a business debt or a consumer debt, many factors occur as the debt becomes older making it more and more difficult to collect including:

· Relocating (skipping) to parts unknown.

· Loss of motivation to pay—the more time which elapses, the less motivated debtors are to pay.

· Faded memories—they forgot all about this debt.

· Statute of limitations concerns—legally, the claim is no longer enforceable.

· Businesses go under—the lifespan of a troubled company is short, especially in difficult economic times.

· Here today gone tomorrow—some debtors intentionally run up debts, take the goods and services and run (or form new businesses with new legal identities which make collections difficult or impossible).

 Doesn’t the collection professional go about bill collecting the same way I do?  Yes, in many instances the procedures are very similar but just the impact of having a third party involved can be very effective coupled with the very specialized training and techniques developed by collection professionals to bring about results.

 
Collection professionals know what to say and when to say it.  They use their instinct, imagination and creativity, within the bounds of state and federal regulations (which they are trained to follow) and they are highly motivated and have sufficient time to become familiar with your files, familiar with your debtors, and learn and determine what collection techniques work the best.

 

 

9 comments:

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Debt Recovery in India said...

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Debt Collection Singapore said...

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Debt Collection Guidelines said...

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Frontline Collections - London Office Debt Collection said...
This comment has been removed by the author.
Frontline Collections - London Office Debt Collection said...

Thanks for sharing the useful guidelines.
Frontline Collections - London Office Debt Collection

Frontline Collections - London Office Debt Collection said...

Nice Post! By choosing the option of debt collection services, the companies are focusing on various elements. Mainly the debt collection agencies are doing the proper paperwork. On the basis of paperwork, the companies are capable of tracking how many times the agency tries to contact debtors. The information which is provided by debt collection London here will help companies in suing debtors in the future. For getting quick and desired results, you need to hire the best debt recovery agency. There are lots of companies offering services similarly. You should try to compare the available options and pick the best one quickly.

Frontline Collections - London Office Debt Collection said...

It is important to hire the debt collection agency in London and such agencies exist as a collection of outstanding debts becomes a daunting task. Also, the small business can not pay the fees of lawyers all the time to go to the court and get help in debt collection. Here, collection companies help in collecting the debt with fewer charges and can be quite beneficial as compared to other solutions.

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