Debt Recovery

Collecting outstanding debt isn’t an easy process. If a consumer has allowed their obligations to go into delinquency they’re usually either experiencing significant financial difficulty, they’re grossly irresponsible, or they have no intention of paying. None of these situations are amenable to fast debt recovery.

Companies will generally try to collect on their outstanding accounts internally before passing their most egregious cases on to an external debt collection agency. But how wise is this? Are collection agencies effective enough to warrant their fees?

Absolutely. Collection agencies are experts in debt recovery. The most effective agencies have perfected a proven process for their agents to follow that dramatically increases the chances of collecting a debt. Even after their contingency fees, a collection agency is typically able to recover a lot more money than the client can do by themself. Plus they take away all the troubles that your staff has to undergo while chasing your unpaid bills.

Not only should companies trust collection agencies to handle their debt recovery, but they should also pass the debt on to the agency sooner than they do in many cases. That’s because debt collection success is a factor of time, skill, and reputation, all of which favor collection agencies.

Collection Rates Drop As Debts Age

The longer an account remains delinquent, the less likely it is to be recoverable. An outstanding balance that’s one month old has a 94% chance of being collected. By two months that drops to 85%. It falls to 74% collectible at three months, and by six months, only 58% of debts remain viable. At a year, there’s only a 27% chance of recovering the debt.

These percentages assume skilled debt collectors with modern collection tools at their disposal, like those found at agencies. Internal collections departments fare even worse. It’s better not to wait too long to pass your outstanding debts on to a professional.

Collection Agencies Have Advanced Tools and Training

Debt collection is their business, after all. It’s how they make a living. This means collection agencies have just as much of an incentive to collect your debt as you do. It’s rare to find this sort of win-win relationship in business.

Agencies offer their agents rigorous training and access to advanced tools like skip tracing and bankruptcy scrub to improve the accuracy of their collections.

Skip tracing techniques allow agents to track down debtors that have “skipped” out on their debts and are no longer reachable. Bankruptcy scrubs alert agents when a bankruptcy filing occurs so they can move quickly to avail themselves of the proceedings as efficiently as possible.

These and other techniques aren’t always available to internal collections teams, reducing the effectiveness of their efforts.

Debtors Are More Likely to Pay A Collection Agency

When a debt passes from the original creditor to a collection agency, this escalation often makes debtors pay attention. There’s an implied threat when an agency gets involved that doesn’t exist with the original creditor. People that are having financial difficulties, or are just irresponsible will often string their creditor along. When a collection agency begins calling, the debt feels more palpable.

Collection agencies also know how to speak with debtors to motivate payment. That doesn’t mean they threaten them, because they generally don’t. Instead, they use a sophisticated arsenal of psychological tactics to push people toward payment.

As a third-party agent, they can have conversations with debtors that are difficult for the original creditors. They can act as an intermediary or position themselves as a helpful friend instead of an adversary. These are all benefits not afforded to the original creditor.

Collection Agencies Mitigate Legal Risks

Every state has laws governing how debts can be collected. Most creditors are unaware of these. And because they aren’t consistent, businesses that operate in multiple locations may have to follow different regulations depending on the customer.

Collection agencies are intimately familiar with all of these legal frameworks and operate within them daily. Using an agency can shield you from running afoul of these laws.

Collection Agencies Are The Most Effective Option

Quality agencies enjoy a higher success rate than original creditors, are more affordable than lawyers and legal proceedings, and use diplomatic techniques that allow companies to preserve their relationships with their customers.

You should undoubtedly attempt initial collection efforts, but once your delinquent accounts seem unrecoverable, you should trust a collection agency. Their fees might seem high, but keeping 70% of a debt you likely wouldn’t have collected otherwise is a net positive transaction. And if you don’t receive anything, the service costs you nothing. As stated earlier, it’s a win-win.

At some point, nearly all businesses will face delinquent accounts. While it’s smart to initially attempt collection on your own, there’s only so much work you should do. Trying to collect a bad debt is draining on your time and your resources. Eventually, it makes sense to pass the task on to a professional debt collection company.

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If you’re in this situation, you may be wondering how to proceed. If you’ve never sent debt to collections before, the process may seem daunting. But it doesn’t have to be. This article will give you the information you need to be successful.

Look For Collection Agencies With Relevant Experience

As you begin your search, keep in mind that not all collection agencies are equal. It’s helpful to find an agency with experience in your industry. They will be better prepared to handle the specific cases your business faces.

Agencies often specialize as well. If you’re a small business it’s better to locate a company that handles organizations of your size as opposed to one that focuses on midsized or larger companies.

The closer an agency’s experience aligns with your particulars, the more successful they’re likely to be with your accounts.

Balance Fees With Recovery Rates

Some agencies will charge a flat fee for their service, though most operate on a contingency basis. If they don’t collect anything on an account, the service doesn’t cost you anything. Otherwise, they keep a percentage of the original invoice amount, usually between 25% and 40%. Find out which scheme each agency you’re considering uses.

While it might be tempting to choose the agency that takes the smallest percentage, first ask them about their recovery rates within your industry. It’s worth paying more per collected invoice if the company you choose is likely to succeed with more of them.

Check The Agency’s Credentials

Most collection agencies work to maintain proper standards, but some are better than others. Ensure the ones you’re considering are properly licensed according to your state’s licensing rules and follow the guidelines of the Fair Debt Collection Practices Act.

Ask them for references and Google the company for online ratings and reviews. It’s also wise to check with the Better Business Bureau to see if their customers are satisfied with the service they received.

Ask Them About Security Protocols

When you send a debt to collections, you’re passing on sensitive customer information to a third party. It’s essential to make sure you aren’t putting your customers at risk.

Ask each agency to detail the security measures they use to guarantee your debtors’ data can’t be breached. If they can’t be specific about their security protocols or outsource their collection efforts to foreign countries you may want to consider working with someone else.

Some agencies offer a secure, online portal for submitting accounts and getting updates and performance reports on existing collections. This can be quite helpful, but the agency needs to offer assurances that the service is safe.

Ask About Their Collection Practices

Even though the agency is an independent company, your customer will likely tie their behavior to you. So make sure you’re comfortable with the way they handle collections. Good agencies can collect on debts without using aggressive or threatening tactics. Consider how you’d like your customers treated and then see if the agency your considering can work within those parameters.

Also, ask them if they have skiptracing capabilities. This technique leverages multiple cross-referenced databases to find debtors that have “skipped” town to avoid collection. It’s useful for maximizing collection success, so be sure it’s available.

Additional practices that to have at your disposal are credit reporting and legal collections.

Make Sure They Carry Adequate Insurance

If one of your customers feels they’ve been mistreated by the agency you hire to collect their debt, they can sue. The agency should have insurance against this. Otherwise, they may look to try and pass on some of those costs to you.

Read your contract carefully to see how you might be liable. In reality, you shouldn’t be liable at all, but an ounce of prevention is worth a pound of cure.

Once you’ve found a few agencies that tick all of the boxes above, consider a trial run. Give each a portion of your outstanding accounts. The one that nets you the highest total recovery in a given period could handle all of your collections from that point forward.

 

During an unstable economic environment, companies must go to great lengths to ensure their market position, financial strength and durability. That means monitoring and controlling risks as much as possible. One of those risks consists of a company’s clients. B2B enterprises are particularly vulnerable because losing one large client can deal a significant blow to the company. The loss does not mean the future business, but if they file for bankruptcy, then even the current outstanding AR may turn into a complete loss.

It takes startups about 2 to 3 years to become successful and 7-10 to become truly profitable. Nowadays, businesses are shuttering left and right, so knowing what your partners and clients are up to is essential. Watching your business partners’ actions and indicators of financial health is not industrial espionage or lack of trust. It’s about understanding that the appearance of success can hide obstacles and failures that, if not tackled head-on, will negatively impact your partner and, ultimately your own company.

Here’s what to look out for when assessing whether your client is going to file for bankruptcy protection:

1. Delaying your payments:

If your client delays paying your bills on time, watch out. Tell your staff to take precautionary actions to prevent your AR from becoming too significant. Ensure that your account managers and liaisons understand the severity of the situation and all the steps of the process involved in reducing business losses. Start to send invoices and payment reminders more frequently, and instruct your staff to document all interactions with that client, especially promises to pay. Monitor the extent of account deficits. If possible, try to prevent delinquent clients from moving the goalposts of their financial obligations by imposing strict rules of repayment, and escalating as necessary. Don’t wait for too many of your clients to get perilously close to bankruptcy before taking measures to protect your company.

2. Layoffs or a High Turnover:

If the client is handing over too many pink slips, especially to those employees you feel are vital for their organization, that is a big red sign. Some turnover and layoffs are normal, but if you see it is way more than the average, try to find out what is happening.

People leave companies or are terminated for various reasons, and sometimes a company is healthier for it. That being said, a revolving door of employees and managers spells trouble to anyone watching. And the company wastes precious resources training new hires.
Excessive layoffs can be very demotivating. They are alarming because the remaining employees do not find enough reasons to stay, which means they have doubts about the direction the company is going. Employees almost always have some insider knowledge about company’s financial health; if they think that there is no future for them anymore, what does that say about the future survival of the company as a whole?

Employees can quit or be forcefully terminated because of low work volume. Even if that only happens behind closed doors, word will eventually get around that the company is struggling to sustain its operations and generate cash flow.

3. Borrowing too much

Having a bit of corporate debt can be beneficial because it allows a company to better use its cash resources. Having a disproportionate balance of cash and corporate debt can signify that your client is struggling to maintain their cash flow.

When a company applies for new credit to pay off old debts but has not been able to generate enough cash to pay them, it may signal to whoever is watching that an already dire situation may be accelerating. It is fine to refinance or restructure debts to free up some cash for growth or investments but to increase your corporate debt so much that it becomes impossible to pay it back is a financial disaster waiting to happen. The next step is often filing a Petition for Chapter 11 bankruptcy protection.

4. Starting to have a bad reputation.

Is your client’s reputation among investors, business partners, employees, and the community starting to take a hit?

A lot can be said about such a fluid concept in business, but reputation doesn’t just boil down to an image bolstered by successful marketing.

Instead, it is the credibility and respect created by your products’ quality, the professionalism of your leaders and employees, the honesty you show in your business relationships, and so much more. Those individual experiences by customers or clients of a business reinforce each other as strong strands in a web of trust when repeated by word-of-mouth, in writing, or on social media.

On the other hand, the more frail a reputation is, the more dangerous one blow can be. A data leak, discrimination against a minority, gossip inside the company that starts spilling into the public space, or any other action that may ruin your relationships within the industry and with your customers is a real threat to your company. Benjamin Franklin justifiably said:

“It takes many good deeds to build a good reputation, and only one bad one to lose it.”

In our world, where perception has become so important, bad reviews from clients and partners can lead to losing significant business, more so than the quality of the products and services a company offers. The image and pockets of huge companies are often impacted dearly due to insensitive or outdated posts on social media. Although unfair, some of their business partners may be negatively impacted by this, simply by association.

5. Expanding too quickly

Growth is the dream of every entrepreneur, but even in a good year, that can be dangerous. During an unfavorable economic environment, it can be fatal. Spreading yourself too thin, in too many directions, with resources and staff struggling to cover operations, could lead to an implosion. You don’t want to face a Chapter 7 bankruptcy filing where your assets are liquidated to pay off creditors.

Gradual expansion over several years is the more cautious approach, and now more than ever, making sure that what you already have is safe is the right way to go.

6. Lawsuits or problems with legal compliance in the form of complaints and inspections

A lawsuit may erode a company’s credibility, but it may also adversely rattle its partners and clients. However, when the primary regulatory agencies keep showing up for inspections or the number of complaints against the company increases, then the suspicion that there might be wrong-doing at the company rises. One of the most definitive ways to cease to exist as a business is to break the law. While you can turn around a company struggling with finances or bad management or other problems, the law is pretty unforgiving.

7. Losing big clients

Business owners tend to look out for new competitors as the big new threat to their market share. Big companies are slow to make dramatic decisions like cutting off a supplier or changing business partners, not only because of the sheer operational effort involved but also because of binding contracts, yet they will do it if a company doesn’t provide them what they need. With everyone trying to cut their losses and cut off unprofitable or optional sectors of their business, one has to be extra careful about how they treat all of their business clients. A pattern of behavior or failure to deliver will determine whether a client will stay with you or not.

Finally, one of the biggest problems or assets, depending on when and how you make use of it, is flexibility. Being able to weather the storm by changing your operations, prioritizing sources of reliable revenue, taking advantage of new opportunities and technological discoveries will help some business stay afloat or grow, while others will be left behind. The other side of the coin is when a business constantly changes, with unwarranted risks, and jeopardizes its stability. In a period of upheaval, as the one we’re experiencing this year, we need to pay attention to our clients’ decisions, whether it’s the reluctance to evolve, out-of-control splurging, expansion, or irrational changes.

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Segment Your Delinquent Accounts

Collection capacity isn’t unlimited, particularly when delinquency rates are rising. To use your limited capacity most efficiently, it’s helpful to segment your accounts based on delinquency length, the likelihood of collection success, potential recovery amounts, and other factors.

If you have the data available, it’s also useful to segment your delinquent customers based on the channels they’re most likely to respond through.

Segmentation models allow organizations to predict which accounts will require the least effort to recover the most significant portion of funds owed. This amplifies your recovery efforts and prevents your collections staff from spending an inordinate amount of time trying to collect what may be unrecoverable debt.

Expand Your Contact Channels

Modern consumers are reachable in a variety of ways. Phone calls have been the mainstay for collections, but in many cases, consumers have learned to avoid numbers they don’t recognize.

To increase your chances of success, assume an omnichannel approach that works to reach customers at every touchpoint available.

Options include, but aren’t limited to email, text messages, chat applications, and social media platforms. Particularly with younger debtors, digital communication methods tend to be more productive.

Targeting your delinquent accounts across a variety of channels makes it more difficult for them to ignore you. On the flipside, allowing them the freedom to respond to you on a channel they prefer will help you make contact.

 

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Be Compassionate, Not Combative

Approaching delinquent customers in a threatening manner tends to compound their problems. Not only do they owe money, now they have to duck angry phone calls. Hostility often increases a debtor’s tendency to bury their head in the sand and pretend the problem doesn’t exist.

Instead, approach customers with the assumption that they’re good people suffering from adverse circumstances. Instead of threatening them, work to understand what’s going on for them. When you come to debt collection compassionately, you become an ally, not an enemy.

Make sure they know that you’re willing to work with them and that you appreciate their circumstances. Customers that want to pay but can’t, will appreciate the lifeline you’re extending them, making return contact more likely.

Employ Skiptracing

Skiptracing involves compiling information from multiple sources, including credit bureaus, public records, internal research, and other sources, to build a cohesive picture of your delinquent accounts.

When a customer has moved on from known addresses and is no longer reachable, cross-referencing multiple data sources makes it possible to trace where they are and provides possible contact channels.

Be Persistent

Collections can be a thankless task. Delinquent customers can make it extremely difficult to contact them. However, in nearly every case, there are moments, due to entirely unpredictable factors when they’re open to having a conversation.

These moments of clarity can’t be foreseen, so the best way to time your phone call or text message with one is to attempt contact frequently and persistently. This process alone can generate a breakthrough by wearing your customer down.

You won’t be rewarded if you approach collections with sparse and inconsistent contact attempts. Your customer needs to know you’re trying to reach them, and you can’t let them forget.

Be Willing to Settle

Sometimes getting something is better than nothing. If you’ve exhausted your other options and your customer indicates they might be able to afford payment terms with a lowered principal, then a settlement might be in order.

Consider lowering the total debt, dropping the interest rate, or both, bringing the customer’s monthly payment into a manageable range. In many cases, customers stop paying not because they don’t want to, but because they can’t. Helping them get their financial situation under control may allow them to resume regular payments.

In the end, some debts aren’t recoverable, but with the consistent application of principles like those detailed above, a higher than average percentage can be collected.

Use a Collection Agency

Hire a credit card collection agency to effectively recover money from your delinquent accounts.

Collection Demands Service

The upfront cost for 5 Collection Letters is about $12 per account. Debtors pay directly to you, no other fees. Low-cost option. Good for accounts less than 120 days past due.

Collection Calls Service

Contingency fee only. No upfront or other fees. Agency gets paid a portion of the money they recover.  No recovery-No fees. Best for accounts over 120 days. A debt collector calls your debtor many times. If everything fails, a possible Legal Suit is recommended by the attorney.

As a full-time dentist and businessperson with a solitary dental practice, you are obligated to borrow values from both professions to form a devised strategy to effectively run your business. You are aware that a business establishment does not run on “debit” and that you will need all finances to be straightened out in order to keep your practice from hitting the bottom of the barrel. But dental practices have been following a painstaking financial liability scheme for some time; one that involves accounts receivable.

Accounts receivable (A/R) can be a tricky financial situation for a dental office, on one hand, you want the value-add to your clients of an assignment office but on the other, more negative hand, you don’t want to drown into the thousands of dollars in an A/R balance. Money conversations involving A/R balances are common in dentistry.  In most dental practices, the teams have money conversations with patients as many as five times before reaching a resolution and having the monetary spends handed over. It can get very difficult to collect your A/R balance if you are not super focused and strict about receiving them.

Keeping that in mind, we have come up with a list of the best tips and tricks on how you can prevent an A/R balance and how to tackle one if it has been recorded in your bill books. Stop chasing signatures for checks and get paid quicker with these hacks.

1. Make sure the patient’s information is up-to-date

A/R problems can be combated head-on if you have a proactive system for organizing your patient’s details. The main reason why dental practices accumulate a large sum of A/R over time is that their check-in process is inept or incomplete. Make sure your patient’s information is up-to-date in your system. This includes verifying their address, pre-authorized form of payment, insurance information, etc. You need to also ensure that you have communicated to your patient their portion of the cost uncovered by insurance.

The more information you have about your clients, the easier it is to file claims and actually get paid due to it. Otherwise, you will be chasing ghosts or filing claims that are dotted with outdated policies. Double-check all your records, preferably when the patient checks in prior to the appointment.

2. Pre-estimate the insurance with your patient’s insurance company

The next key step to doing away with A/R claims is for you to check-in with the patient’s insurance company. You will also need to make a few calls here and there to pre-authorize the procedure with your client’s insurance company. Doing this lets you be in the loop of how much of the expense will not be covered by insurance. Keep a credit card on file for every patient and get access to use it. This is a great way to clear out small patient portion balances. But, in doing so, make sure you have a safe and secure way to store it as well as legal authorization to use it.

3. Discuss the treatment plans with patients upfront

Reducing A/R balances in your billing system entails a comprehensive approach for you to communicate to the patients the need and importance of a complete fee. For this, you will have to make your patients understand the need for treatment and recognize what the procedure can do for them in clear detail. This meeting is crucial for your patients as well as your practice as you are essentially “selling” treatment to a patient with their own consent and understanding. Long-term preventive care and treatment are the hardest to convince your patient to avail of.

You need to learn to talk to your patients as you would a family member or friend to emotionally connect and empathize with their personal and financial circumstances. Be the patient’s advocate and convey to them the benefit of completing payment head-on. These small, seemingly insignificant interactions about payoff can lead to less time spent collecting fees and more appointments to fill your calendar.

4. Educate your patient on the insurance charges

A lot of patients who come into your clinic are not aware of their insurance coverage and their benefits. You will have to educate your patients about their coverage benefits and its different tiers, levels, copays, inclusions, and allowances. Even if the patient has scanned his or her plan, there may still be some limitations and inconsistencies that are not obvious in the plan summary. By talking to your patients about their insurance, you are in a way relating to the patient’s issues which would give you an opportunity to connect with your patient.

5. Provide third-party patient financing

Instead of providing patients with payment plans and struggling to collect them, try offering third-party patient financing as a way to manage your practice A/R. Use two or three different companies to help finance the patient. But be careful to do your research and make sure that you are working with a reputable company that will add value to your patient experience. Doing this selectively will create patient loyalty and allow them to accept the treatment that they need, which will help boost your case acceptance. You will be prioritizing your patient’s needs over your own by this action due to which your patients will be more likely to stay with you and refer.

6. Employ insurance verifier technology

Insurance verifier technology allows you to visualize up-front which codes require claim attachments to adjudge a claim. Reviewing claim attachment requirements before submitting a claim as this helps you provide or attach appropriate documents such as perio-charts, x-rays, as other procedural documents, in advance. Doing this up-front will help you get paid quicker and not have your A/R balance crank up. In cases where you may not attach verifying case attachment documents with your claims, there is a huge possibility that the payer may reject your claim due to a lack of required documentation.  Installing an insurance verifier technology helps save time and keeps revenue surging.

7. Bill frequently, Remind promptly

Consider billing on a net-15 or net-10 basis instead of the customary practice of waiting 30 days. By being on top of your patient’s monthly obligations, you will naturally get more payments. You can contact your patients through their preferred media – be it email, call, text, and so on. It is important to contact your patients if you do not hear from them even after billing.

• Patients that are 30 days overdue or under can be easily tackled by having a credit card on file. In case you do not have a credit card on file, give your patient a call every few days to remind them of the payment.
• Payments that are between 30 and 60 days overdue can be harder to collect but with a strategized communication plan, it can be combated.
• Payments that are over 90 days overdue can be a challenge to collect. Give the patient a call every other day for the first 10 days. If the issue has not been resolved by then, you could send a letter each week for the next three weeks. If neither phone calls nor request letters work, you may try mailing a demand letter.

8. Hire a collection agency to collect your fees

Alternatively, you can hire a collection agency to contact your patients about their payments so that you do not look vicious and “money-hungry”. If you have noticed that your staff has been contacting your patients frequently, it is time to outsource to a collection agency who will attempt collection on your behalf. These collection agencies will charge anywhere between 20 to 40% of what they collect.

Know your numbers and take action accordingly. Implement any of these strategies to help lower your A/R balance and get paid faster!

Collecting outstanding debt isn’t an easy process. If a consumer has allowed their obligations to go into delinquency they’re usually either experiencing significant financial difficulty, they’re grossly irresponsible, or they have no intention of paying. None of these situations are amenable to fast debt recovery.

Companies will generally try to collect on their outstanding accounts internally before passing their most egregious cases on to an external debt collection agency. But how wise is this? Are collection agencies effective enough to warrant their fees?

Absolutely. Collection agencies are experts in debt recovery. The most effective agencies have perfected a proven process for their agents to follow that dramatically increases the chances of collecting a debt. Even after their contingency fees, a collection agency is typically able to recover lot more money than the client can do by themself. Plus they take away all the troubles that your staff has to undergo while chasing your unpaid bills.

Not only should companies trust collection agencies to handle their debt recovery, but they should also pass the debt on to the agency sooner than they do in many cases. That’s because debt collection success is a factor of time, skill, and reputation, all of which favor collection agencies.

Recovery Rates Drop As Debts Age

The longer an account remains delinquent, the less likely it is to be recoverable. An outstanding balance that’s one month old has a 94% chance of being collected. By two months that drops to 85%. It falls to 74% collectible at three months, and by six months, only 58% of debts remain viable. At a year, there’s only a 27% chance of recovering the debt.

These percentages assume skilled debt collectors with modern collection tools at their disposal, like those found at agencies. Internal collections departments fare even worse. It’s better not to wait too long to pass your outstanding debts on to a professional.

Collection Agencies Have Advanced Tools and Training

Debt collection is their business, after all. It’s how they make a living. This means collection agencies have just as much of an incentive to collect your debt as you do. It’s rare to find this sort of win-win relationship in business.

Agencies offer their agents rigorous training and access to advanced tools like skip tracing and bankruptcy scrub to improve the accuracy of their collections.

Skip tracing techniques allow agents to track down debtors that have “skipped” out on their debts and are no longer reachable. Bankruptcy scrubs alert agents when a bankruptcy filing occurs so they can move quickly to avail themselves of the proceedings as efficiently as possible.

These and other techniques aren’t always available to internal collections teams, reducing the effectiveness of their efforts.

Debtors Are More Likely to Pay A Collection Agency

When a debt passes from the original creditor to a collection agency, this escalation often makes debtors pay attention. There’s an implied threat when an agency gets involved that doesn’t exist with the original creditor. People that are having financial difficulties, or are just irresponsible will often string their creditor along. When a collection agency begins calling, the debt feels more palpable.

Collection agencies also know how to speak with debtors to motivate payment. That doesn’t mean they threaten them, because they generally don’t. Instead, they use a sophisticated arsenal of psychological tactics to push people toward payment.

As a third-party agent, they can have conversations with debtors that are difficult for the original creditors. They can act as an intermediary or position themselves as a helpful friend instead of an adversary. These are all benefits not afforded to the original creditor.

Collection Agencies Mitigate Legal Risks

Every state has laws governing how debts can be collected. Most creditors are unaware of these. And because they aren’t consistent, businesses that operate in multiple locations may have to follow different regulations depending on the customer.

Collection agencies are intimately familiar with all of these legal frameworks and operate within them daily. Using an agency can shield you from running afoul of these laws.

Collection Agencies Are The Most Effective Option

Quality agencies enjoy a higher success rate than original creditors, are more affordable than lawyers and legal proceedings, and use diplomatic techniques that allow companies to preserve their relationships with their customers.

You should undoubtedly attempt initial collection efforts, but once your delinquent accounts seem unrecoverable, you should trust a collection agency. Their fees might seem high, but keeping 70% of a debt you likely wouldn’t have collected otherwise is a net positive transaction. And if you don’t receive anything, the service costs you nothing. As stated earlier, it’s a win-win.

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