![]() When making a selection between collection agencies, be selective about choosing a one that counts professionalism among its top priorities. Furthermore, because of this billing structure, collection agencies are just as motivated as you are to recover the debt. Collection agencies aren't paid until they produce payment, so there are no out of pocket costs if funds aren't collected. If your debtors refuse to pay or are being evasive, collection agencies have the tools and the influence to get at least some of the payment as opposed to you writing off a complete loss. If you haven't received payment, they start the official collection process.Ĭollection agencies are one of the most important partnerships that any small or large business can make. Some collection agencies offer a free 10 day demand letter service where they will actually print, stamp, and mail the demand for you after you fill in a few online fields. There can find templates for demand letters online simply fill in the debtor's name, the amount owed, print, mail, and let your collection agencies known who to pursue if 10 days have passed without payment.įor a faster solution, consider allowing collection agencies to send the demand letter. If a phone call reminder doesn't yield a payment, it's time to move on to step three.Ī ten day demand letter is an official warning informing the debtor that unless they pay within 10 days, you'll be handing over the debt to your collection agencies. As part of the Fair Debt Collection act, you cannot call a person at unusual hours or harass them over the phone. Some of your debtors may only need to be confronted by a voice to produce a payment. Even if you plan on using collection agencies to recover funds from some of your more difficult debtors, it makes sense to sense to start with a polite phone call asking for payment. The simplest and sometimes most effective way to get a debt settled quickly is to call the debtor yourself. If you want your bill to be among those that get paid, make sure that your late notices stand out in the crowd. When money gets tight, they often pick and choose which debts to pay based on a company's tolerance for late payments and potential threat of adverse action. People don't normally set out to avoid paying their bills. Though you're in the initial stages of collecting on a past due balance, you want your debtor to know that your company is not one that is going to be avoided passively. Don't make this notification look like just another bill try using pink or yellow paper and printing the amount due in red ink. If your debtor hasn't responded to your regular billing attempts, follow up with a 'Past Due' notification. ![]() ![]() Let the debt go unpaid for 6 months and you're likely to collect only half of the original debt. ![]() After three months of delinquency, you'll collect only about 73 cents on every dollar according to statistics. Statistically speaking, the sooner you begin the process of collecting on a debt, the greater the odds that you'll collect the entire amount owed. You can begin pursuing an overdue debt as soon as the debt becomes overdue. With so much legislation around fair debt collection it's imperative that you or any collection agencies you hire adhere to specific guidelines when attempting to collect debt. While the process of regularly billing customers is relatively simple and fast, the process of trying to collect on a past due account can be time consuming and downright frustrating. There's little more frustrating for a business owner than a customer who won't pay his or her balance due.
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