Debt Recovery

The YMCA is one of the largest and oldest non-profits worldwide. They serve more than 60 million people in 120 countries and are essential pillars of the community in small towns and big cities. They provide vital services for underserved populations and all types of programs and facilities for the local community. For most, the local YMCA offers these facilities and programs for a fee, and unfortunately, these fees sometimes go unpaid. In these instances, YMCAs need help recovering the money they are owed so the organization can stay financially healthy. Here is how working with an experienced, ethical debt collector can help YMCAs accomplish this.

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Why YMCAs Need Debt Collection 

YMCAs have two general types of programs they provide. There are free programs that serve the members of the community who are in need. These include family services, education outreach, child welfare, and foster care programs. Keeping track of who owes what and when payments are due can be cumbersome, especially if the YMCA center does not have a robust accounting system. Delay in payments can affect the cash flow of the YMCA center, making it difficult to manage operating expenses.

These services that local YMCAs play a massive role in the community and do so much for people in need. The challenge for YMCAs in offering these types of programs is that they cost a good deal of money and do not make any money for the organization.

This means that YMCAs must offer other ways to support these vital community-building programs. One of the ways they do this is by offering paid facility use and programming for the segments of the community who want to partake. This includes things like providing fitness facility use, dormitories, facility rental, and recreational and social programs such as Summer Camps. In many cases, members take advantage f these offerings based on just a deposit or with a monthly fee. When the balance of these payment plans goes unpaid, it can hurt the Y’s bottom line.

How a Debt Collection Agency Benefits YMCAs

Debt collection can be a touchy subject, especially for a non-profit organization that does so much good in its community, like the YMCA. However, it is a necessary process because if the Y provides too many services without the cash flow to back them up, they could fail and ultimately be of no use to the community at all. This is especially true for an organization providing many free programs for those in need. They cannot afford to carry people who can afford to pay but choose not to.

Turning outstanding accounts receivable that are 60 or 90 days past due to a debt collection company makes sense for YMCAs. These agencies have the professionals and the skill set to recover more money faster than the non-profits would ever be able to on their own. These debt collection professionals also know how to do it in an amicable and ethical way that will not violate local, state, or federal laws or cause undue stress on the member.

Conclusion

When done the right way, YMCAs using an experienced, ethical debt collection agency can be a win for all parties involved. The members can be treated with the respect and dignity they deserve and the YMCAs will not only receive the money they are owed so that they can continue offering all the essential community programs and services but also not alienate their members. This will allow the YMCA to function appropriately, stay financially healthy, and continue to meet the needs of their local community as the organization has been doing for more than 175 years.

Jewelers, just like any other business, can improve sales by offering financing options to customers. Costly items, such as engagement rings, luxury watches, and precious stones can be out of reach for many cash buyers. With branded in-house store credit, jewelers can turn more shoppers into buyers. While increased sales are a good thing for jewelers, unpaid accounts receivable can destroy the bottom line. Understanding collection options is essential for the successful use of store credit.

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Good debt collection practices begin at application

When extending credit, there is always a risk of nonpayment. Because of this risk, the best debt collection practice begins at the time credit is extended. Take the time at the beginning of the process to properly qualify buyers. Requiring a small deposit, such as $100 down, can help weed out less creditworthy buyers. It’s also important to check the buyer’s credit. When doing so, look for records of positive payments. If the applicant has delinquencies, ask for a detailed explanation. Have the applicant complete a simple cash flow showing income and expenses. If there is ample room to pay for the installments, the buyer probably is a good bet.

If properly qualified, you’ll also have crucial information to help with your collection efforts. Collect as much contact information as you can. Ask for credit references and personal references. You can contact the credit references at application to ensure their accounts were timely paid, and personal references give you a contact in the event that the customer fails to pay. One of the strongest collection tools is contact, so prepare now and be able to connect with your customer in good times and in bad.

Tools for jewelry stores

Also, consider automatic drafting for payments, so you don’t have to rely on a buyer sending payment each month. Other tips include offering incentives for early payment, such as a 5% discount or waiving the last installment. Store credit is a sales tool, but it also is part of building a solid customer relationship. Your buyer might have a temporary setback that impacts the ability to pay. Be mindful of this as part of a bigger relationship. Flexibility in payments can help ensure full payment in the future.

But, if a debtor cannot pay and refuses to engage in conversations about payment arrangements or incentives for full performance under the credit agreement, be prepared to exercise some of the collections options available to jewelers. For the most part, a jewelry store is just like any other creditor. You can formally demand payment, contact the debtor, and move to legal steps if the customer does not respond to demands

Most of your legal rights will be the same as any other creditor, with one key difference. Most consumer debt is considered unsecured, because a lien – such as a mortgage or a car title lien – is not involved in the transaction. However, in some circumstances, store credit accounts can retain a security interest (similar to a lien) in the item that is purchased with credit. This can become a powerful tool in the event of a bankruptcy proceeding. Instead of your debt is wiped away, the debtor may be required to return the jewelry to you in the event of nonpayment. It is important to ensure that you use the right language in your credit agreement to retain this protection.

Using a third-party collection agency

In most cases, collections can be more successful if handled by a third party. You have a jewelry business to run, and by handing the case to a professional collection agency, you can focus on growing your business while an experienced professional firm can engage in the type of investigation and contact necessary for successful collection.

Collection Agency Services Include

Collection Letters Service

The upfront cost for 5 Collection Letters is about $15 per account. Debtors pay directly to you, no other fees and a 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 the debtor many times. If everything fails, a possible Legal Suit if recommended by the attorney.

For more information on the benefits of hiring a third-party collection contact us.

The rent-to-own industry is one of the most unique business models in the country. The business is a part service industry, part retail, and part leasing company. On a given day, a Rent-to-Own business has to deal with all sorts of issues and challenges in order to keep the business up and running smoothly. Customers primarily lease furniture and appliances. One of the biggest problems in the industry is unpaid bills. 

Every Rent-to-Own company faces clients with unpaid bills all the time. There are multiple ways of dealing with this, and the Rent-to-Own industry even has special collections laws that apply only to this industry.

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Most common AR issues are:

1. Delayed Payments: Some customers may not pay their monthly installments on time, either due to financial hardship, forgetfulness, or other reasons. This can lead to cash flow problems for the rent-to-own company.
2. Customer Default: In some cases, customers may cease payments altogether because they can no longer afford the payments or because they have decided not to continue with the rent-to-own agreement.
3. Disputes Over Product Quality or Service: If a customer is dissatisfied with the quality of the product or service received, they may withhold payment or seek to terminate the agreement.
4. Inadequate Customer Screening: Failing to properly assess a customer’s creditworthiness or ability to make payments over the long term can result in a higher likelihood of default.
5. Regulatory and Legal Challenges: Rent-to-own companies operate in a heavily regulated environment, and changes in laws or regulations can impact AR by affecting what can be charged, how collections can be pursued, etc.

No matter how you do it now, every Rent-to-Own company should consider working with a specialized debt collection agency that knows the ins and outs of the rent-to-own business. Here is why.

Dealing with Unpaid Bills 

Like any business, Rent-to-Own companies provide a service and goods to consumers, expecting them to pay as specified by the contract they enter into. When customers don’t pay, this can hurt the business’ bottom line and lead to problems. Companies with too much outstanding debt may lack the cash flow needed for day-to-day operating costs or long-term growth. This is the biggest problem facing the Rent-to-Own industry.

The industry does have some unique advantages that other businesses do not. The biggest advantage is that they own the goods until the end of the lease agreement. While this offers some protection, taking back goods is not ideal for multiple reasons, including the time it takes to resell and the possibility of being unable to sell it again. Collecting the debt owed is the best outcome, so working with a debt collection agency with experience in the Rent-to-Own industry is such a good idea.

Rent-to-Own stores offer Furniture, Appliances, Electronics and Computers on a lease. The timeframe of the rent-to-own agreement is usually 2-3 years. This may include TVs, couches, washers, smartphones, computers, dryers, engagement rings and motor vehicles. These stores are located nationwide.  Their prices are often higher because they include delivery, setup and other services many retailers don’t offer. Laws in many states allow rent-to-own companies to pursue criminal charges against customers who miss payments and do not return the rentals upon the company’s request. Unpaid bills or lease installments are a huge problem for the industry.

Knowing the Collection Laws 

One of the biggest reasons that working with a specialized Rent-to-Own industry debt collection agency makes so much sense is that they know the debt collection laws that are specific to the Rent-to-Own industry. And, not only do they know them, they know how to leverage them effectively and efficiently to get the best result.

Since the property involved in Rent-to-Own deals is still the property of the selling/ leasing company, debt collectors can be more aggressive in their pursuit of settling the debt in these situations. While it is against the Fair Debt Collection Practices Act to threaten criminal action in most debt collection cases, there are many states where Rent-to-Own debt collectors can use this tool as not returning Rent-to-Own merchandise can be pursued as theft.

Protecting Your Business Reputation

Because unpaid bills are such a big problem in the Rent-to-Own industry and collectors can use more aggressive tactics, many companies in the industry can get a reputation for being vicious debt collators. This reputation can go beyond just your collection department and seep into your core business. This can cause bigger problems down the line than just delinquent bills.

Separating your business from the act of collecting the debt is a good move for the health of your business. The debt collection company you choose can still pursue debts vigorously but will be acting independently from your core business. This will help insulate your business from negative reviews and other complaints while still allowing you to pursue debts with all the tools available to a Rent-to-Own business.

Conclusion 

 Debt collection and the Rent-to-Own industry go hand in hand. While many businesses handle it themselves, it makes more sense in many cases to use an experienced debt collection agency that knows the intricacies of the Rent-to-Own business. It will benefit the business and cost less in the long run, both in PR and real dollars.

Medical professionals widely use Raintree systems EMR, especially those practicing in Physical Therapy (PT, OT, ST), Rheumatology, Bariatrics, Pain Medicine and Pulmonology.

Already using Raintree Systems EMR? Have unpaid medical bills?  Need to transfer your overdue accounts receivable to a debt collection agency? Contact us You decide what should be the minimum outstanding balance eligible for collections. Only send accounts if a payment hasn’t been made in _(60/120/180) days. Send 5 collection demands to your patient or transfer directly for debt collection calls. You are in total control of the process. Dedicated small business debt collectors. Contact us for a demo of our free Raintree debt collection utility.

Raintree Software Benefits and Features

To run a successful medical practice in 2020, most practices need some software to help. Practice management software offers many features and benefits that allow practices to spend less time on this business end of the practice and more time focusing on what matters, caring for patients.

The problem is, every practice is different, and what is good for a cardiologist might not be suitable for a pediatrician. That is why specialists benefit most from software solutions tailored to their specialties. For physical therapists, Therapy Rehab Plus by Raintree Systems has provided specialized software for these types of practices since 1985. Here are some of this software’s biggest and best features and benefits.

“Tailored”, Not Just Customized

Like most practice management software solutions, Raintree uses words like “flexible” and “customized” to describe their offerings, but they take it a step further. Raintree integrates with your practice by offering “tailored” solutions, not vice versa. Their software is meant to manage your existing business and allow you to continue work the way you want. With this software, your practice can keep existing workflows, processes, and best practices. The software will make it all easier to manage.

The Raintree Implementation Experience

One of the biggest concerns that practices have about implementing practice management software is the time and money it will take to get it up and running. Integrating these dense systems into your practice can lead to downtime, things getting lost or missed, and more money than initially anticipated.

The Raintree Implementation Experience is an answer to these concerns. The company has a tried and tested system to get practices going with the software with minimal headaches. They will assign you a dedicated Implementation Team to help deal with any issues that arise and offer guidance and assistance until the system is up and running smoothly.

Tools Specifically Designed for Physical Therapists 

Practice management software is only as good as the tools it offers your practice. A one-size-fits-all software may have great tools, but if they aren’t designed with your specialty in mind, you may have to flex to use them effectively. With Raintree, you get an easy-to-navigate, single-screen dashboard with specially designed tools that physical therapy practices need. These tools include physical therapy-specific functions such as:

• Tracking multiple episodes of care in one patient record
• Provides workflows and templates specifically for physical, occupational, and speech therapy
• Can email or fax documents to referring and participating providers
• Uses an automated electronic insurance eligibility verification

These are just a few of the specialized capabilities this system offers. The system can also seamlessly connect all your departments so everyone in the practice is on the same page. They also offer specialized revenue cycle management (RCM) software to help your therapy practice stay on track financially while using these tools.

Conclusion 

There are a lot of great practice management systems out there, but there are very few that are specifically customized to be used by a certain specialty. That is what makes Raintree’s Therapy Rehab Plus system truly stand out. Having a software that is already tailored to your practice, coupled with the fact that Raintree is dedicated to getting your practice up and running on the system with as little hassle as possible, makes for a great practice management software solution experience.

 

 

Every year several students fail to pay their tuition fees. Additional charges may include room and board fees, library dues and more. Colleges need this money for daily operations, plus they cannot set a negative precedent for other students who have been paying their tuition fees on time till now.

Specialized collection agencies adept in university debt recovery are well-versed in legal debt collection aspects, ensuring ethical and lawful methods. These agencies achieve higher recovery rates than college internal staff. Outsourcing accounts receivable to a  collection agency allows college accounting teams, often short-staffed, to focus on their core responsibilities.

During the collections process, collection agencies can also instruct students to complete their Federal Student Aid (FAFSA) documentation, potentially helping them pay off their student loans. The University CFO/Bursar plays a crucial role in maintaining the financial health of the institution, they can rely on collection agencies to perform appropriate recovery services for active and inactive students.

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Your collection agency should be able to rightfully advise on how their collection strategy will work so that:

• Existing students should not drop out fearing collections the collection strategy should encourage them to complete their course while making payments gradually.
• Remember that many students may have Pell Grants or other federal aid covering nearly 90% of their tuition. Therefore a careful diplomatic approach is essential for active students.
• Explain to students that if they drop out, the government will not cover any tuition they may qualify for, and the student will be fully liable for all fees incurred. However, if they re-enroll and complete the course, they will be on the hook for the 10% payment only and the government will pay the remaining 90%. Therefore a collections agency can even encourage several inactive students to re-enroll.
• The collections approach can be more intensive for students who have completed the course or have become permanently inactive.
• College staff is always understaffed, so the collections approach should reduce their burden and work as a seamless extension of their accounting staff.

Collection agencies for colleges have in-depth industry-specific knowledge. They ensure the college’s reputation is not tarnished during the collection process. Old university debt is often considered gold because the ability of individuals to serve their student debt gets better. They gradually settle in life and start earning more money. Assigning old accounts to a professional debt collector is always smart, resulting in high recovery rates for the institutions.

Diplomacy is essential in the debt-recovery process for universities, even if they collect only on inactive students. To maximize its federal aid, the university must have a sound collection process in place. A hybrid debt-recovery program designed for educational institutions will not only recover money from existing and ex-students but also help re-enroll students who have dropped a semester.

It is important that universities must hold students accountable for their financial obligations. Doing so helps nurture personal responsibility and financial planning and allows universities to provide the best learning possible. Here is how universities can responsibly use a debt collection agency to deal with past-due accounts.

Types of Debts for Colleges and Universities

Universities are complex institutions that have many financial aspects involved. Unlike most businesses where accounts receivables are for a single or small group of products or services, the types of debt college students may owe to a university are diverse and wide-ranging. These debts that sometimes go unpaid can include but are not limited to things such as:

• Tuition Fees
• Student housing charges
• Meal plans
• Library charges
• On-campus violations
• Administration fees
• And more

When these debts to universities go unpaid, it is vital to collect as much of the owed money as possible and in as timely a manner as possible. The university must collect to operate and students must fulfill their financial obligations.

Tools to Collect Student Debt

When student tuition or other accounts go past due, the university has several tools to help collect the debt. The university can stop the students from continuing at the school or prevent them from benefiting from the time spent at the school. To do this, the school may withhold grades, transcripts, or degree certification, prevent the student from registering for future classes or bar the student from the university entirely. Once an account goes past a certain point (usually 30, 60, or 90 days), it is best for universities to turn the account over to debt-collection professionals if they hope to recover any money. English, Spanish and Mandarin debt collectors are required for university debt collections.

Collection Demands Service

The upfront cost for 5 Collection Letters is about $15 per account. Debtors pay directly to you with 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 a debtor many times. If everything fails, a possible Legal Suit is recommended by the attorney.

Working with a University Debt Collection Agency 

How and when you turn a student’s unpaid debt over to a university debt collection agency will vary by institution and location. While private universities have more leeway, many states have specific rules about transferring student debt for collection. For example, any debt 60 days past due in Virginia and under $3,000 may be handed over to a private debt collection company. Any similar debt over $3,000 must be sent to the state attorney general’s office for collection. An experienced university debt collection company will know all these specific rules and regulations and help you work out how each account should be handled.

When a university does transfer education accounts receivables to a university debt collection agency to recover unpaid charges, the agency can also help guide you toward the best financial options for the institution. Again, depending on the type of college or university and the local laws, the institution may be able to protect itself financially and collect the debt at little to no cost by assessing penalties, interest and collection agency fees to the original amount of the account.

A university debt collection agency will have experience working with educational debt and know the best ways to settle these debts that will benefit the institution and the student. They will be able to advise schools on local regulations and help ensure the debt is collected as quickly as possible.

Conclusion 

Institutions of higher education such as colleges and universities, are in a unique position when it comes to debt collection. Like any organization, they need to collect money owed to preserve financial health and also do it in a way that is responsible to their mission of providing life lessons and experience to their students. An experienced university debt collection agency can help schools collect debts in the right way so universities can achieve all their goals.

Commercial debt collection or B2B collection involves two business entities, one of which owes money to another.

We can recover your outstanding invoices quickly, professionally, and without harming your business relationships. By using techniques like soft collections, skip tracing tools, credit bureau leverage, expert negotiation, legal network access, and third-party pressure, we tailor our recovery approach to fit your industry, debtor profile, and age of the debt—because effective collections are never one-size-fits-all. Majority of cases are resolved without the need for court involvement.

Our success rate in commercial collections is quite impressive. Most accounts that are less than one year old see an average recovery rate of approximately 80% on viable claims ( Less than 1 year old, and proper supporting documentation provided). 

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The longer you wait, the more likely it is that the business may no longer have the ability to pay you. Working with an experienced B2B collection agency increases the chances of preserving a positive client relationship while helping you avoid the high costs of litigation and enforcing a judgment.

Our Commercial Debt Collection Methodology

• No Recovery – No Fee: If a commercial collection agency work on a contingency fee model, means if it does not recover money for you, they will not make any money either.
• Documentation and Primary Contacts: Apart from the core documentation, you may have emails or phone recordings in which the debtor could have acknowledged the debt. Tell your collection agency precisely who you think should be reached out to resolve this debt.
• Customized Strategy for Each case: An experienced commercial debt collector will analyze your case and develop a custom collection strategy. He will call your defaulter and get him talking. The collector may even email, fax,message or send certified mail to get your debtor’s attention. They explain all the consequences of not settling the debt.
• Initiation: Talk to client and identify the actual cause of non-payment and devise a plan for payment. The collector will decide the optimal time and contact for calls or emails, and will judiciously escalate pressure as needed. If a client blocks one number, call is made from a different number. A commercial collector employs various strategies to expedite debt recovery.
• An aggressive approach usually does not work: A well-planned diplomatic approach protects the business relationship,  your debtor is approached with dignity and respect. A well-calculated intensive approach can be used later to resolve debts if your debtor does not cooperate with us.
• Send Legal Notice: If all amicable collection efforts fail, a notice may be sent through an attorney (in-house lawyer or a partner law firm). This puts tremendous pressure on your debtor to settle the debt.
• Final chance to settle: Most cases are settled even before a case is filed in court. Legal action is pursued only after written authorization from you.
• Final Negotiation: If the debtor proposes a settlement offer lower than the original amount due, it is accepted only after your approval ( also known as Settle-in-Full authorization).
• Court Order and Enforcement: Once a favorable judgement is achieved, we take several actions to enforce it and get paid.  The collected amount (minus the contingency fees) is remitted into your bank account via ACH transfer or by mailing a check.
• Credit Reporting: Just like individuals, businesses also have credit scores. Commercial collection agencies can report debts to business credit bureaus ( ex: Moody’s Experian and Dun & Bradstreet). This can impact a business’s future ability to obtain loans and business prospects.
• Duration: Most cases are resolved within 40-45 days. However, some may last for a few months if a court order is required. The commercial debt collector may also negotiate a payment plan if required.

Ongoing Checks: Commercial collection agencies use advanced tools to track significant changes to your debtor’s business credit profile. Debt collectors can find business owners’ alternate addresses and telephone numbers using skip-tracing tools. A commercial collection agency may also find a recent summary of your debtor’s payment activity with other creditors to further strategize their collection efforts.

Good News – There are no federal “Statute of Limitations” for commercial debt. 

Commercial Collection Agency Fees:

Commercial collection agencies have a low-cost contingency fee model; No recovery means No fee is charged. The collection fee for each case is communicated in advance and primarily depends on three factors: Age of debt, Balance Due, and Complexity. The contingency fee is usually between 20% and 40% of the collected amount. Accounts with lower balances or those older than one year have a slightly higher contingency fee. Here is a rough estimate of what a typical commercial collection agency fees are:

	Contingency fee (Based on Account Age and Amount Assigned)
Age < 90 days	25%	20%	15%	10%
90-180 days	30%	25%	20%	15%
180 days – 1 year	35%	30%	25%	20%
Age >1 year	40%	35%	30%	25%
Amount Assigned	$500- $5k	$5k- $20k	$20k- $100k	$100K +

Comparing Consumer (B2C)  vs Commercial (B2B) Collections

Consumer (B2C) collections focus on recovering debts from individual customers, often requiring a delicate, customer-centric approach. In contrast, Commercial (B2B) collections involve reclaiming debts from businesses, typically demanding a more formal, contract-based strategy.

When selecting a commercial collection agency, consider factors like their experience, success rate, tactics they use, whether they have proper licensing and accreditation, and reviews or references from other clients. All commercial agencies must follow the Uniform Commercial Code (UCC).

Legal and regulatory collection laws

Consumer debt collection is largely governed by federal laws, such as the Fair Debt Collection Practices Act (FDCPA), and some state regulations.

A commercial debt collection agency is entirely exempt from most of these laws because these laws aim to protect consumers than businesses.

As of April 15, 2022, CFPB Director Rohit Chopra hinted at the possibility of expanding FDCPA laws to commercial debt.

Relationships matter: Negotiate for better recovery.

Understanding your legal options thoroughly is crucial, but avoiding litigation is often the preferable course of action. Encouraging amicable discussions for settling debts can lead to more productive recovery outcomes, and may even preserve ongoing business relationships. If you find yourself dealing with a business customer who has overdue obligations, aim to steer clear of confrontational approaches. Instead, focus on collaborating to find a mutually beneficial solution to the problem.

Blurring the line between personal and commercial debt

A commercial collection agency has fewer restrictions; however, many commercial debts are backed by a personal guarantee. When the collections process moves to the enforcement stage, such as levying against bank accounts and other assets, you may be limited by the individual guarantor’s rights.