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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.

Traffic and parking violation tickets are a good income source for local enforcement agencies. Unpaid tickets can cause a huge hole in the finances of cities and counties.

If initial efforts of police and regional transport authorities to collect the fine are unsuccessful, engaging a collection agency specializing in government debt might be necessary. These agencies have the experience and tools to collect unpaid tickets efficiently.

Need a Collection Agency for Unpaid Tickets? Contact Us for a free consultation – Serving Nationwide

Courts and law enforcement agencies charge the original fine plus late penalties once an account is forwarded to collections. Some states allow them to charge an additional 30%-40% Collection Fee on top of the delinquent amount. The unpaid amount can be reported to credit bureaus if requested. Debtors can make payments online, over the phone, or using a credit card.

Some jurisdictions may allow the suspension of the violator’s driver’s license or vehicle registration if they have unpaid traffic tickets or parking violations.

Traffic police officers do not have adequate resources and time to chase people who have not paid citations, parking and traffic tickets issued by law enforcement officers. Collection agencies have advanced skip-tracing tools to find the latest contact information of debtors and employ diplomatic tactics to recover money. Forwarding these violations after 60 days to a professional debt collector for a maximum recovery rate is recommended.

Traffic ticket amounts are usually under $100, and not every collection agency will effectively dedicate the resources required to collect significant money from these accounts. Only those collection agencies with an efficient recovery process and those with extensive experience recovering for law enforcement agencies. A low-fee collection agency will ensure maximum money is recovered from unpaid traffic and parking tickets.

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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.

 

Recovering Credit Card Debt Nationwide Need a Collection Agency? Contact Us Higher Recovery Rates: Top-Notch Customer Service

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.

Tired of a beautiful CareCloud dashboard and an ugly aging report?
You’re not alone. Many practices get the front end right—claims go out, payments come in—yet a stubborn pile of old patient balances never really moves.

Why CareCloud users still struggle with A/R

CareCloud checks a lot of boxes:

• Cloud-based EHR and practice management

• Integrated RCM tools or full billing services

• Dashboards that show denials, collections, A/R trends

On paper, everything looks under control.

But in real life you still see:

• Accounts that sit 60, 90, 120+ days past due

• A growing chunk of A/R tied to patient responsibility

• Staff who “will follow up later” but never quite get to it

That’s not a software bug. That’s the gap between billing and debt recovery.

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Where CareCloud helps you – and where it stops

CareCloud is very good at what it is supposed to do:

• Capture charges and create claims

• Scrub and submit those claims accurately

• Post payments and adjustments

• Generate aging and KPI reports

• Send standard statements and reminders

What it does not do:

• Call a patient every week for two months

• Track down a guarantor who moved and changed numbers

• Negotiate a realistic payment plan when a family is already behind on other bills

• Decide which accounts should move from “late” to “collections”

If your strategy is “we’ll keep sending statements and hope something happens,” your old A/R will keep growing—no matter how polished the software is.

 

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The “red zone”: when an invoice stops being a bill and becomes bad debt

Every practice has a point where, if you’re honest, you know:

“If this hasn’t been paid by now, it probably won’t be… unless someone treats it like a collections problem.”

A few simple signals:

• Age: The balance has been sitting for three to four months with no meaningful payment.

• Silence: Statements went out, maybe a couple of calls… and then nothing.

• Behavior: The patient stopped responding, keeps cancelling, or ignores every message.

CareCloud will happily show you these accounts in your A/R Aging report. It will not make the hard decision for you.

You need a line in the sand that says:

“After this point, this stops living in our billing workflow and moves to our collection workflow.”

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Turn your CareCloud A/R into a simple rulebook

Instead of debating every account, build a small rulebook that lives on top of your CareCloud data.

Here’s one way to structure it:

Rule 1: Time

• If a patient balance has no payment in 90+ days, and

• You’ve already made at least 3 contact attempts (statement, portal reminder, or phone call),

→ it is eligible for collections.

Rule 2: Amount

• Very small balances (for example under $50–$100):

  • Either batch them once or twice a year, or make a decision to write them off.

• Mid-sized balances (for example $150–$750):

  • Follow your normal reminder workflow; if still unpaid at 90–120 days, move them to collections.

• Larger balances (for example $1,000+):

  • Review earlier and escalate faster if there is no payment or plan by 60–90 days.

Rule 3: Exceptions

• Keep out:

  • Formal payment plans that are being honored

  • Active disputes

  • Approved charity-care or special-case patients

Once this is written down, CareCloud becomes a trigger engine, not just a reporting tool.

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How a CareCloud-friendly collections workflow fits in

Now you need a way to turn those rules into an actual, repeatable process.

That’s where a CareCloud-friendly debt-collection utility comes in. The goal is to make the handoff from CareCloud → collection agency:

• Easy to configure

• Boring to run

• Hard to forget

Typical knobs you control:

• Minimum balance:
  “Only send accounts with balances over $200 or $300.”

• Account age:
  “Only send accounts where there’s been no payment for 90 days (or 60 / 120 / 180—your choice).”

• Recovery path:

  • Start with a fixed-fee letter series (firm but courteous demand letters), or

  • Go straight to contingency collections for the worst accounts.

• Exclusions:

  • Remove accounts in payment plans, flagged disputes, or any category you mark as “do not place.”

Once configured, the utility:

1. Reads the A/R data from CareCloud.

2. Finds accounts that match your rules.

3. Prepares a clean, secure file for your collection partner.

You’re no longer “remembering to send accounts to collections”. It just happens on schedule.

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Three simple playbooks (you can adjust the numbers)

You don’t have to reinvent anything. Start with patterns like these and tweak them to your comfort level.

Playbook 1 – Standard patient A/R

• Balance ≥ $200

• No payment in 90+ days

• At least 3 contacts recorded

→ Send to a fixed-fee letter program first. If no response after that series, escalate to contingency collections.

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Playbook 2 – High-balance safeguard

• Balance ≥ $1,000

• No payment or arrangement at 60 days

→ Manager review + one last internal call.
If still no plan by 90 days, move to a full collections placement.

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Playbook 3 – Old A/R cleanup
Once a month, run a report of all patient A/R over 120 days that isn’t in a payment plan or dispute.

• Decide whether to:

  • Place them in bulk with your collection agency, or

  • Close / write off accounts that truly have no recovery path

Either way, you stop letting “forever balances” clutter your CareCloud reports.

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“Won’t using a collection agency upset our patients?”

It depends on who you choose and what you ask them to do.

A good healthcare-focused collection agency will:

• Work under HIPAA and other privacy rules, sharing only the minimum needed information

• Follow debt-collection regulations and your own communication preferences

• Approach patients with a firm but respectful tone

• Offer realistic payment options instead of “pay in full or else” ultimatums

Your team stays focused on care and early financial conversations.
The agency focuses on late-stage accounts that have already been given reasonable chances.

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Where Nexa fits in (and what we don’t do)

Quick clarification:

• Nexa is an information portal.

• We are not a collection agency.

• We do not call your patients or report to credit bureaus.

What we do:

• Talk with practices that use platforms like CareCloud and dig into their A/R challenges, typical balances and patient mix.

• Help you think through placement rules that sit on top of your existing CareCloud reports.

• Share your collection requirements with a shortlist of medical collection agencies we believe are a good match for your type of receivables.

• Leave it completely up to you whether to work with any of them.

CareCloud already gives you cleaner claims, better reporting, and a clearer view of your revenue.

Layer a simple, rule-based collections process on top, and those stubborn 60–120+ day balances stop being long-term residents in your aging report—and start becoming cash you can actually use.

Already using CareCloud Software? Have unpaid medical bills?  Need to transfer your overdue accounts receivable to a 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 CareCloud debt collection utility.