No business owner likes to think about sending an account to collections, but, unfortunately, this is something that, all too often, has to be done. The good news is that there are a lot of good collections agencies out there, ones you can count on to act responsibly in your name and to get you the money you are owed.
However, not all debt collection agencies are all they’re cracked up to be. To avoid wasting time and money, make sure you follow our tips for choosing the right collections agency to meet your needs.
Find the Right Fit
First things first, you need to make sure you find a collection agency that is equipped to meet your specific needs. Some agencies, for example, specialize in working with larger companies while others are more skilled at dealing with small businesses. It’s important to do your research and to choose a collections agency that has worked (and worked well!) with businesses like yours in the past.
Make Sure They Can Track Down Debtors
Another important thing to look for is an agency that has the power to track down debtors who change contact information, such as addresses and/or phone numbers. The best and most effective collections agencies have access to and are adept at using “skip tracking” technology. With this feature, they can access all of the major debtor databases and find those who owe you money...no matter where they go.
Find an Agency that Knows Its Stuff
All debt collection agencies are required to act, at all times, in accordance with the laws and regulations set forth by the Fair Debt Collection Practices Act. No matter what you do, choose an agency that is familiar with these rules and that doesn’t have complaints filed for acting against them (you can view complaints and other problems through the Better Business Bureau). Your business could end up facing litigation if your debt collector doesn’t follow the laws, so this tip is of the utmost importance.
Ensure They Have Insurance
You also want to make sure that your debt collection agency is backed by insurance. That way, you’ll be protected in the off-chance that all your good planning and research fails, and your debt collector does violate a Fair Practice law.
Consider Your Budget
While it’s important to get the highest possible quality of service, you also have to be practical and think about your budget. Always ask a debt collection agency upfront about its fees. Some agencies just charge an upfront fee to work for you while others only charge if they actually collect on accounts. In either arrangement, you need to carefully consider the possible costs and do a little comparing to find the right collection agency to meet your needs.
If you can keep these tips in mind and follow this advice closely as you choose a collections agency, there’s no reason you shouldn’t have a positive experience and get great benefits from using your agency.