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Collection Agency for Kindergarten and Child Daycare centers

Child Care Collections

Unpaid tuition fees can cause a lot of financial burden on Daycare Centers, Kindergarten, Preschools and Child care centers. Many daycare centers attempt switching to a 100% prepaid model, but it generally results in a loss of enrollment as most parents prefer a postpaid model.

After sending several reminders to the parents an amicable resolution seems impossible. Some daycare centers try taking the matter to a Small Claims court, but of course, that requires significant preparation, fees, stress and time. This time could have utilized for getting new clients or enhancing your daycare facilities. Even if a daycare center wins the judgment in a small claims court, it does not guarantee payment. Many parents either fall into the low-income bracket category, or they are experiencing a temporary financial problem ( like job loss, medical emergency bills, etc.). Regardless of their personal situation, a daycare center should attempt to recover their tuition and meal fees, which they rightfully deserve.

In most cases, without the help of a professional collection agency, daycare centers are forced to writing-off these overdue accounts receivable as a complete loss in their accounting books. Collection agencies can recover money diplomatically and amicably while preserving the reputation of your daycare.

Need an Experienced Daycare Collection Agency: Contact us

Low-cost Collection Letters offered by collection agencies is an excellent way to collect money from your past due accounts. There is a massive difference between parents getting an invoice from a child care center versus a collection demand from a debt collection agency. Communication from a collection agency means it is just the beginning of the collection process, a lot more is still to come. Parents will dig their pockets deeper to get rid of the collection agency, especially when it has to do with their child.

Collection Letters Service
  • Upfront cost for 5 Collection Letters is about $15 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 debtor many times.
  • If everything fails, a possible Legal Suit if recommended by the attorney. 

Check this: Cost of hiring a collection agency

There are some unbeatable advantages when using a collection agency:

1. Five diplomatic Collection Demands are sent out at an average cost of $15 per account. In this price, they also perform scrubs like “USPS Change of Address” and “Bankruptcy” validation. This enables the agency to send letters to the latest address of the parent. If a parent has filed for bankruptcy and ithey may be exempted from paying debts, including the fee of your child care center.

2. If the amount remains uncollected even after the Collection Letters service,  with your permission, these accounts will be forwarded for Collection calls or to file a Legal Suit to recover your money. These are contingency-based services.

3. Collection agencies allow parents to make payments in installments, online or over the phone. Installments approach facilitates parents of lower-income groups and those having temporary financial issues to making smaller payments.

4. An online portal provided by good collection agency allows you to submit debts easily and quickly. It is recommended to submit an account for the Collection Letters service after the debt has been 60 to 180 days past due.

5. You should add in your initial “Childcare Center-Parent” contractual agreement that the parent is responsible all costs of debt collection on unpaid bills, not limited to late fees, court fees and the collection agency fees. Even if you do not attempt to recover the amount spent on collections, still a large portion of the money should come back, which otherwise would have been a 100% loss for your daycares.

6. Ask the collection agency if they have a diplomatic and an empathetic approach for collections, it helps to maintain your positive reputation. There will always be some parents who will get very upset the moment they get a letter from you or the collection agency, but it does not mean you should write off that debt, fearing an adverse reaction. You have the right to recover your money to help run your own business and improve its cash flow.

7. A collection agency ensures that they comply with collection laws like FDCPA, TCPA, and several state debt collection regulations.

Forwarding a case to the collection agency means you can keep your 100% attention running your Child Care center and let the collection agency experts work as an extension to your business to recover the bad debt.

If you need a collections agency to take care of your unpaid accounts receivable: Contact us.

Filed Under: Debt Recovery

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