Debt Recovery

Construction equipment companies have an ongoing requirement for debt collection from businesses (and sometimes individuals) that do not pay the agreed-upon rental dues on time. Heavy construction equipment dealers, like Bobcat, Kubota Center, and John Deere, forward accounts to a collection agency after their reminders and requests to pay have failed.

An experienced collection agency with extensive commercial collections experience is a perfect choice. It is an added advantage if they have experience in consumer collections and a nationwide debt collection license.

Need a cost-effective Collection Agency? Contact Us Serving Equipment Rental Companies Nationwide

Collection fees charged by collection agencies are relatively low compared to consumer collections. Collection rates are also high, in the vicinity of 80%.

If you want to know the commercial debt collection process, click here. A collection agency will attempt to recover the debt so your business relationship with your customers is not damaged.

Here are some common billing issues that may arise in construction equipment rental and suggestions for addressing them:

1. Incorrect Billing: Sometimes, an invoice may contain errors such as incorrect rental rates, wrong equipment details, or billing for a longer period than the equipment was actually rented. To resolve this, it’s important to keep meticulous records and review invoices carefully before sending them to customers or paying them if you are the renter.
2. Late Fees and Penalties: A renter might be unaware of late fees and penalties associated with the late return of equipment. Make sure that the terms and conditions regarding late returns and associated fees are clearly stated in the rental agreement.
3. Damage Charges: Disputes may arise over charges for damages to the equipment. To avoid this, conduct a thorough inspection of the equipment both at the time of rental and return, and document any pre-existing damage.
4. Unauthorized Charges: Sometimes additional charges that were not agreed upon might be added to the bill. It is important to have a detailed contract that outlines all charges and conditions to avoid unauthorized billing.
5. Billing Cycle Confusion: There may be confusion regarding the billing cycle, especially in long-term rentals. It’s important to clearly specify whether the billing is weekly, monthly, or based on another time frame, and make sure both parties are aware of the billing cycle.
6. Lost Invoices or Delayed Billing: Invoices may be lost in the mail or sent out late, which can create disputes over timeliness and late fees. Utilizing electronic invoicing and maintaining copies of all sent invoices can help mitigate this issue.
7. Payment Terms Disputes: There may be misunderstandings regarding payment terms such as due dates, grace periods, and acceptable payment methods. Clearly define and communicate payment terms in the rental agreement.
8. Fuel Charges: If the equipment uses fuel, there might be disputes regarding fuel charges, especially if the equipment is returned with less fuel than at the time of rental. Be transparent and clear about fuel policies.

To minimize billing issues in construction equipment rental:

• Have a detailed and clear rental agreement.
• Maintain accurate and detailed records.
• Communicate openly and clearly with customers.
• Use electronic invoicing and billing systems to track payments and send reminders.
• Regularly review your billing process to identify and correct recurring issues.

In case of disputes, it is also advisable to have a dispute resolution process in place, and if necessary, seek legal counsel.

If your delinquency strategy relies on cutting locks and hosting auctions, you are playing a losing game.

For decades, self-storage owners have been taught a simple workflow: Tenant doesn’t pay -> Lock the unit -> Auction the contents. But let’s look at the real math. When you auction a unit, you are usually selling used mattresses, old clothes, and broken furniture. You might get $40 for the contents, but the tenant owes you $800.

You just accepted 5 cents on the dollar and called it a “resolution.”

That isn’t a recovery; that’s a donation.

Smart operators know that auctions clear space, but collections clear debt. At NexaCollect, we help you pivot from relying on low-yield auctions to securing full cash payments. We use the leverage of credit reporting and professional demands to get your money before the lock has to be cut.

Why the Auction Process is a Revenue Killer

Relying solely on your state’s lien laws to recover revenue is financially dangerous for three reasons:

• The “Junk” Factor: Industry stats show that over 80% of auctioned units sell for less than the outstanding debt. You are spending money on newspaper ads and certified mail to sell items that nobody wants.

• The Leverage Gap: Many tenants actually want you to auction their unit. They left trash behind and are using you as a free dumpster service. They don’t care about the stuff—but they do care about their credit score.

• The Opportunity Cost: Every day you wait for the legally mandated auction timeline (often 60-90 days), that debt gets older and harder to collect.

The Better Way: Don’t wait for the auction. Deploy a third-party collection agency early (Day 45-60). When a tenant realizes that non-payment will block them from renting an apartment or buying a car in the future, they find the money to pay you—often before the auction even happens.

Recover Dollars, Not Pennies: A Strategy That Works

We offer a recovery system that runs parallel to your lien process, maximizing your chance of getting paid in full.

1. The “Pre-Auction” Pressure (The Sweet Spot)

• Timing: Days 30–60 (Before you cut the lock).

• The Move: Use our Step 1 & 2 Flat-Fee Service ($15/account).

• The Logic: We send official demands warning the tenant that this is now a “Collection Account.” This is far scarier than a lien notice.

• The Result: The tenant rushes to pay the full balance to avoid credit damage. You get 100% of the cash and don’t have to waste time hosting an auction.

2. The “Deficiency” Cleanup (If You Must Auction)

• Timing: Post-Auction.

• The Move: Use our Step 3 Contingency Service (40% fee).

• The Logic: If you do have to sell the unit to clear the space, don’t write off the remaining balance. We pursue the tenant for the difference.

• The Result: You clear the unit for a new renter and we chase the old tenant for the cash they still owe.

Serving Some of the largest Self-Storage Companies! Need a collection agency? Contact us

Real Scenarios: Auction vs. Collection

See the difference in how these scenarios play out for your bottom line:

Scenario A: The “Traditional” Auction Route

• Debt: $1,200 (3 months rent + late fees).

• Action: You wait 90 days. You follow lien laws. You auction the unit.

• Sale Price: The unit sells for $110.

• Net Result: You recover $110. You lose $1,090.

Scenario B: The NexaCollect Route (Columbus, OH Client)

• Debt: $1,200.

• Action: On Day 45, the facility manager submitted the account to our Step 2 service.

• The Leverage: We sent a formal demand letter noting the intent to report the debt to credit bureaus. The tenant was applying for a mortgage and couldn’t risk a collection record.

• Net Result: The tenant paid the full $1,200 immediately. The facility paid us a $15 flat fee. Net recovery: $1,185.

FAQ: Rethinking Storage Collections

Q: Can I send a tenant to collections before I auction their unit?

A: Yes! In fact, you should. Your lease agreement is a financial contract. Once they are in default (usually Day 5-30 depending on your lease), you have the right to demand payment through a third party. You do not have to wait for the lien process to finish.

Q: Won’t the auction satisfy the debt?

A: Rarely. Unless they are storing gold bars, the auction proceeds almost never cover the rent, late fees, and legal costs. Relying on the auction to make you whole is a gamble with terrible odds.

Q: If they pay the collection agency, what happens to the unit?

A: If they pay in full, the default is cured! You unlock the unit, and they are an active tenant again (or they can move out properly). You saved the customer relationship and avoided the hassle of a sale.

Q: Do you report to tenant screening databases?

A: We report to the major credit bureaus (Equifax, Experian, TransUnion). This feeds into the tenant screening reports that other landlords use. A tenant who stiffed you will find it very hard to rent an apartment next month.

Recent Results: Real Numbers from the Industry

The RV & Boat Storage Case (Texas)

• The Situation: A specialized facility had 3 high-value parking spots abandoned. The vehicles were towed/auctioned, but the remaining balance for back rent was $18,500.

• The Challenge: The owners had moved out of state and thought they were untouchable.

• The Result: Our skip-tracing team located all three debtors. We negotiated settlements totaling $14,200 within 60 days. The facility owner recovered nearly 77% of “lost” revenue without lifting a finger.

The Multi-Unit “Hoarder” Cleanup (Ohio)

• The Situation: A facility manager dealt with a tenant who rented 4 large units, filled them with trash, and stopped paying. The cleanup cost alone was $3,500 on top of $6,000 in back rent.

• The Challenge: The auctions netted a combined total of only $200.

• The Result: We pursued the tenant for the full deficiency plus lease-specified cleaning fees. Fa

Stop Trading Valuable Rent for Cheap Junk

Your units are real estate, not flea market booths. Enforce your lease and get paid what you are owed.

Click here to Contact Us and upgrade your recovery strategy.

Have you mistakenly overpaid your employee or a contractor who refuses to return that money?

• Did you sponsor higher education for your employee with a commitment to work with you for a few years, but he resigned right after completing the degree?
• Did they sign a contract stating they would pay back the training fees if they didn’t work for a specific duration?
• Other circumstances where an employee can owe money to his employer include – overpaid salary, excessive travel expenses, misuse of company credit card, unreturned company equipment like a laptop or excessive reimbursement claimed.

Need a collection agency? Contact us

A collection agency can work with your employee professionally and legally to ensure that you get your money back. Their recovery efforts will include sending demand notices and calls from a professional debt collector. If the amount is substantial or litigious, they will forward it to an experienced attorney.

Often the employee becomes unreachable or unresponsive to the employer’s contacts. They often change their address. A standard practice among all good collection agencies is to use the Skip Tracing service to find out the latest whereabouts of the debtor or the offender. A collection agency is not a replacement for police; they only act to recover the debt legally. They can report the debt to credit bureaus like Transunion and Equifax if the creditor/employer instructs them. It is crucial to maintain proper documentation to avoid getting sued by your ex-employee in cases like these. An employee debt collection agency will follow all federal and state debt collection laws to recover all unfair reimbursements and money owed.

Recommendations:

Document the Overpayment: Create a clear record of the overpayment, including details like the amount, the reason for the overpayment, and any relevant policies that were not adhered to.

Listen to the Employee’s Perspective: Allow the employee to share their side of the story. There might be information or circumstances you are not aware of, and it’s important to consider all sides before taking action.

Final Internal Communication: Before involving a collection agency, it is often best practice to send a final communication to the employee outlining the outstanding overpayment and your intent to involve a collection agency if the matter is not resolved.

Provide Documentation to the Collection Agency: Supply the collection agency with all relevant documentation regarding the overpayment. This should include any communication you’ve had with the employee regarding the issue.

Simple Answer: Once the unpaid debt entry hits the credit report, the fear of not paying in the debtor’s mind is gone. You just used the most effective debt recovery tool before giving the debtor enough time to settle the unpaid.

The debtor thinks, “Well .. this is the worst scenario ..  then why should I even bother paying now?“.

Even if he makes payment later, the entry stays there (as paid), still negatively impacting his credit score for the next seven years. If a credit report entry is done too soon, it in fact discourages many debtors from making payments. Do not rush into credit reporting. Use it wisely.

Some debt collection agencies agree to remove the entry from the debtor’s credit report once the bill is paid, but this is not common. Offering the removal of a genuine credit report entry in exchange for payment is considered a highly unethical practice among credit reporting agencies and the accounts receivable industry. The provision to remove credit report entry was allowed only to fix mistakes and not to be used as a tool for debt collection.

Credit reporting agencies (Equifax, Experian and Transunion) may forbid a collection agency if this violation is caught multiple times. Also, removing an actual late payment from the credit report risks those lenders who might give a loan to this person in the future.

Most experts in this industry recommend that credit report entry be done after all debt collection means have been exhausted and the debt is more than 180 days past due.

Only medical credit report entries are an exception. Once the patient or his insurance company pays off a debt, it must be removed from the credit report. However, by law, they cannot be reported before one year. Once paid, all debts are marked as paid in full on the credit report and not deleted entirely.

Creditors and collection agencies who prefer to do credit reporting quickly will likely see lower recovery rates. The fear in the debtor’s mind is gone.  However, collection agencies that delay credit reporting keep this valuable tool for later use.

Although creditors and collection agencies can pursue legal means of debt collection like garnishing wages, placing a lien on the property, or freezing the debtor’s bank accounts, not more than 20% of debts qualify for legal action, either the low balance or the complexity of the case.

The debt collection industry has been through one of its most difficult periods in modern history, and the recovery looks slow and prolonged. A national and, at the same time, a global recession has been caused, not by financial crises, but rather by an unexpectedly devastating health issue. This is a time to show resilience and learn what we can in order to protect ourselves in the future.

Performance of Collection Agencies during Covid-19 Pandemic Economic downturns create a huge opportunity for the debt collection industry. A large number of creditors are stuck with unpaid invoices, and as their own efforts fail they tend to submit more accounts to collection agencies. However, during the recession, even the collection agencies find it hard to recover money as people have no funds to pay off their bills. However, as the economy starts to turn around, collection agencies are able to perfectly time their recovery efforts to maximize the chances of successful debt collection to ensure that their clients are the first ones to be paid. During peak Covid-19 duration (May-Nov 2020) many states prohibited debt collection for several months. Recoveries dropped to a mere 50% of the normal levels. It was the worst time for collection agencies in decades. Many agencies had to shut down during this period. The turnaround came the following year, during tax refund season as the debt recovery levels went up substantially ( March/April 2020). Additionally, the government-assisted stimulus packages resulted in recovery rates jumping by almost 1.5 times than normal, because people wanted to pay off their debts with this extra cash. Collection levels will stabilize to normal levels only after the Covid-19 problem completely subsides.

Given its unprecedented scope, how can we access the resources at our disposal and organize our industry’s practices and decisions in a way that would enable us to survive and recover sooner rather than later? Looking at the two major crises in the last century, the Great Depression and the Great Recession, we can use the traditional route of analyzing both pre-and in-crisis data, to identify which receivables can be collected with a higher success rate and focus our efforts there.

Reporting information to build a reliable database

One of the difficulties in accessing that data is the reporting of consumer information by creditors and by debt collection agencies, themselves. The number of those actually furnishing payment information to the consumer reporting agencies has decreased in the last 10 years. A report released by the Consumer Financial Protection Bureau placed the number of reported payments on credit card accounts at 40% in 2020. In 2013, it was at 88%. The Bureau estimates that, as of 2020, ‘only about half of issuers with recent payments furnish these data’.

There may be several factors driving this decline, but what it boils down to for us is the unavailability of reliable information in terms of assessing the number of consumers that made payments, the number of accounts being paid and the speed at which their outstanding debts were being paid. Given this problem, we have to look elsewhere.

A boom in unchecked credit precedes economic crises

It’s generally accepted that ‘the more credit intense the expansion years preceding a crisis, the more severe the recession and the slower the recovery’ (Household Debt and Economic Recovery Evidence from the U.S. Great Depression, EHES Working Papers in Economic History | No. 36, p.4, March 2013). Now we know that before the Great Depression, there was a credit boom accompanying the economic expansion of the 1920s, where banks and financial intermediaries competed to extend credit for consumption and investments. As everyone tried to get a piece of the pie, investments became riskier and regulators turned more of a blind eye, caught in the euphoria of the boom, until the economic bubble began to contract due to non-viable financial choices that were economically unsupported long-term. The widespread, large volume of those financial decisions dragged down a vulnerable system, where consumer and commercial credit had been offered with no restraint.

The Great Recession of 2008 follows a similar pattern, where the domestic credit and subsequent debt in the financial and non-financial sectors increased significantly before and during the crisis. Financial institutions and regulators seem to have still a hard time establishing preemptive policies and controls to prevent recessions, from minor to devastating, from occurring.

What’s also interesting about financial and economic crises is which industries seem to recover time and again, where innovation is coupled with bold investment choices or sweeping reforms that draw from the strengths of previous solutions. The automotive industry is a fascinating example of stubborn efforts and reliable reinvention decade after decade.

US economy before and during Covid

Before the Covid epidemic, US credit levels had been increasing for several years, accompanied by an increase in delinquencies. Excessive borrowing and already vulnerable sectors of the economy might have led to another man-made financial crisis eventually, but the virus cut that transition short quite violently, sending shockwaves through the entire world. Even industries that were doing well, such as commercial construction, transportation, biopharmaceutical research and development, found themselves forced to overhaul their operations at an unprecedented cost. In November of 2020, some Harvard economists calculated that the pandemic would cost the US at least $16 trillion, provided it ended by the fall of 2021.

The levels of employment started spinning down at the beginning of 2020 with some industries hit so badly, it’s hard to believe they’ll take less than a few years to recover. For example, consider leisure and hospitality workers, whose employment fell by over 20% compared to 2019, or book retailers and news dealers, who recorded a 48.9% drop from 2019.

Source: US Bureau of Labor Statistics

These are industries where debtors will be hard-pressed to find money to pay debts for no other reason than that they are unemployed. They are, by no means, exceptions. The reports of the US Bureau of Labor Statistics provide a discouraging image of the levels of employment in 2020. There are a few industries that recorded positive percentages when compared to 2019, but they are rare: warehousing and storage, gardening and residential construction, software publishers and credit card issuers, and a few others.

It’s worth noting that credit card issuers and real estate credit maintained or increased their employment levels, due to continued demand for credit, but commercial banking and consumer lending decreased their payrolls.

A focused approach to keep costs down and maximize receipts

The next 6 to 12 months are going to be an uphill battle for creditors. As the economy improves, following vaccinations and easing of restrictions, recoveries for creditors will start going up as well. Until then, the focus of collection efforts needs to be on those consumers who are in the least-impacted industries. The important factors to look at are: ratio of debt to income, a history of debt repayment, occupation, likelihood that they’ll file bankruptcy (see bankruptcy demographics), family size, and employment status.

It’s good to remember that these are not infallible guides, but they help make sorely-needed predictions. Income, for instance, is not a totally reliable indicator of a consumer’s willingness to pay debt. In some cases, consumers with higher expendable income may maintain debt for longer periods of time specifically because it takes up a smaller percentage of that income. Those whose monthly credit card payments are only 20% of their income might be more comfortable with that debt. On the other hand, consumers with lower income, whose monthly credit card payment bites painfully into their short-term individual or household income, at around 30%-40%, may feel more inclined to resolve their debt situation, even if it means taking out a loan, or making low, but consistent, payments every month. Obtaining current information about a given consumer will help a collector evaluate and compare them to other collection opportunities.

In addition, debt collection rates vary widely from state to state. The population of the Southern states seem to have the hardest time paying off their debt, according to this interactive map about debt in America, last updated in March of 2021.

With many debt collection agencies having shut down and others operating with fewer staff and less financial resources, wasting time and money on chasing random debtors may be the last nail in the coffin for some agencies’ profit margins. Breaking down your portfolio of delinquent debts into categories based on the information here may help optimize your collection efforts and accelerate cash inflow.

En Puerto Rico—desde los hoteles de lujo en Isla Verde y Condado hasta las farmacéuticas de Barceloneta y los comercios de la Milla de Oro—sabemos lo que es “bregar” duro para echar hacia adelante. Pero en 2026, el que no se pone al día con el nuevo Código Civil, pierde. Con la fiscalización de DACO más fuerte que nunca y la prescripción de deudas a los 5 años, usted no puede darse el lujo de esperar. No deje que sus facturas se vuelvan sal y agua; en Nexa hablamos su idioma y sabemos cómo recuperar sus biles sin que usted pierda el sueño ni la reputación.

Nexa provides 100% reputation-safe, equipped with all 50-state collections license & PR, offering free credit reporting, free litigation/bankruptcy scrubs, and zero onboarding fees. Secure – SOC 2 Type II , DACO & HIPAA compliant.

Need a Collection Agency? Contact us

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El Paisaje Legal en la Isla 

Puerto Rico se rige por el Derecho Civil, lo que significa que las reglas aquí son distintas a las del “Mainland”. Si usted piensa que tiene 10 años para cobrar, su deuda podría estar ya “muerta”.

Tipo de Deuda	Tiempo para Cobrar (Prescripción)	Base Legal
Acciones Personales (Deuda General)	5 Años	Código Civil Art. 1201
Pagarés / Notas Promisorias	3 Años	Código de Comercio Art. 946
Servicios Médicos / Salud	3 Años	Código Civil Art. 1203
Embargo de Salario	Solo el 25% (75% protegido)	Regla 56.4 Proc. Civil
Sentencias Judiciales	15 Años (Renovable)	Código Civil Art. 1201

Reglas Críticas para el 2026 en P.R.:

• El “Barranco” de los 5 Años: Con el nuevo Código Civil, su tiempo se redujo drásticamente. Nexa audita sus cuentas para identificar cuáles están a punto de “vencerse” y las activa de inmediato.

• Reglamento 9037 de DACO: El Departamento de Asuntos del Consumidor prohíbe el hostigamiento. Nexa utiliza mediación bilingüe profesional que cumple 100% con DACO para evitarle multas a su negocio.

• Interrupción Extrajudicial: En P.R., una carta certificada bien redactada puede reiniciar el reloj de la prescripción. Nosotros nos encargamos de enviar estas reclamaciones para que su derecho al cobro no expire.

• Protección Salarial: Aquí se protege el 75% del salario. Por eso, Nexa se enfoca en identificar activos, cuentas bancarias y otras propiedades para asegurar que el recobro sea real.

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Costo-Efectividad: La Ventaja de Nexa

• Servicio de Tarifa Fija ($15 por cuenta): Ideal para cuentas nuevas. El deudor le paga el 100% directamente a usted. Sin comisiones de por medio.

• Servicio de Contingencia (20%–40%): Cobro basado en resultados. Si no recobramos sus chavos, usted no paga ni un centavo.

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Industrias que Servimos en Puerto Rico

• Turismo y Hospitalidad: Atendiendo la “Economía del Visitante”. Recuperamos facturas de eventos, cancelaciones y deudas de huéspedes en hoteles y paradores de San Juan hasta Rincón. Sabemos cómo cobrarle al turista que ya se fue de la isla.

• Farmacéuticas y Manufactura: Cobro B2B especializado para el sector industrial de Pharma-Coast. Manejamos disputas de logística y suplidores con precisión bilingüe.

• Salud y Servicios Médicos: 100% cumplimiento con HIPAA. Navegamos la prescripción de 3 años en servicios médicos, usando una mediación empática para que su oficina médica no pierda pacientes ni dinero.

• Universidades y Colegios: Manejamos el recobro de matrículas y cuotas de vivienda con un enfoque diplomático que respeta los ciclos de becas y el “Bono de Navidad” local.

• Contadores y Firmas de CPA: Recobro de honorarios profesionales. Entendemos los ciclos de planillas de Hacienda y cobramos lo suyo sin dañar la confianza con sus clientes.

• Bancos y Cooperativas de Ahorro y Crédito: Expertos en préstamos personales y comerciales atrasados, utilizando las leyes de hipotecas y sentencias de la isla.

• Construcción y Contratistas: Recuperación de pagos para HVAC, eléctricos y contratistas generales. Expertos en gravámenes (Liens) bajo el Código Civil.

• Comercio B2B, Restauración y Logística: Recuperación rápida para empresas que no pueden permitirse tener el dinero “estancao” mientras los costos de operación suben.

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Resultados de Recobro Recientes en P.R.

Caso 1: Resort de Lujo en el Área Metro (Turismo)

• El Problema: $95,000 en facturas de eventos corporativos de una empresa de EE.UU. que no quería pagar.

• El Resultado: Nexa utilizó su red interestatal y mediación bilingüe para recuperar los $95,000 completos en 45 días, sin tener que pisar el tribunal.

Caso 2: Centro de Especialistas en Bayamón (Médico)

• The Problem: $120,000 en deudas de pacientes que estaban a punto de cumplir los 3 años de prescripción.

• El Resultado: Implementamos un plan de “Reclamación Extrajudicial” y recuperamos $82,000 en 70 días, salvando legalmente el resto de las cuentas.

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Preguntas Frecuentes (FAQ)

1. ¿Todavía puedo cobrar una deuda vieja de más de 5 años?

Si la deuda nació después de 2020, el límite es generalmente 5 años. Pero, si usted hizo una reclamación formal antes, el tiempo pudo haberse reiniciado. Nexa le hace una auditoría gratis para ver si su deuda sigue viva.

2. ¿DACO prohíbe llamar a los deudores en Puerto Rico?

No lo prohíbe, pero lo regula estrictamente (Reglamento 9037). Nexa conoce las horas y frecuencias permitidas para que su negocio no se meta en problemas legales.

3. ¿Qué es eso de “Cuentas Claras”?

Es el estándar de transparencia que exigimos. Usted tendrá reportes en tiempo real de cada “vello” y cada peso que estemos gestionando para usted.

Nosotros cobramos sus cuentas morosas Need a Collection Agency (Agencia de cobros) in PR? Contact us