Frequently Asked Questions
As soon as you have reason to believe the account is not going to be paid, you can refer it to an agency. Generally, the debtor has told you they won’t pay or have simply ignored your statements and past due notices.
Once you know you have a collection problem, the sooner you assign it to a collection agency, the greater the chances it can be collected. It has been proven that the probability of collection diminishes with time. Holding on to an account too long can greatly reduce the chances for it to be collected by anyone.
There are two points of view to consider:
- You should consider switching agencies if you are not happy with the recovery rate or level of customer service you are being provided. Do you receive numerous complaints from your customers (clients or patients)? Does your agency respond well to your inquiries? Do they argue with you when you want to cancel an account? These and many other factors specific to your business should be considered when deciding if a switch is in your best interest.
- You should consider adding another agency if your volume of assignments warrants a split. Competition breeds excellence in performance. If your current agency is not compared with another agency, are they putting their most experienced collectors and resources on your accounts, or have they become complacent?
Our goal is to improve the probability of collecting your account while maintaining the optimum level of goodwill. Our unique initial softer approach opens the door to negotiation and cooperation. We tackle the problem, not the payer – unlike many of our competitors. With too aggressive a demand up front, two adverse effects can happen:
- Litigation – if an aggressive collection call closes the door to negotiation, then litigation may be the only option. Litigation can take more time and cost more in an increased commission rate.
- Bankruptcy – if they file, the door closes to further collection efforts.
If they have proven that they will not pay, yet have the ability to pay (employed, homeowner), a suit will be evaluated for merit. If warranted, we will file upon your authorization. However, as a third-party collector (which is true of all collection agencies) we are not allowed to file in small claims court. We must file an action in civil court. Unlike small claims court, this type of action requires the services of an attorney. We have a full-time paralegal on staff, extremely experienced and knowledgeable, to assist us in all matters that require the use of the legal system to enforce collections.
Because there are much larger expenses associated with a civil action, many agencies use a minimum balance as one of the requirements to select which accounts are approved for suit. Because some agencies are simply not staffed to sue every account that qualifies for suit, they limit their suits, again, by the size of the balance. Most will not file unless the balance is at least $1000. There are some agencies that do not file suit at all.
Our position, and another way we distinguish our agency from our competitors, is that we believe overall collection recoveries improve when all accounts are given the same level of attention. For this reason, we will file suit on balances as small as $500. Under some circumstances, suit may be filed on balances less than $500. Compare this with other agencies.