Notice: Undefined variable: handle_code in /home/wp_f5v2xn/ on line 243

Notice: Undefined variable: handle_code in /home/wp_f5v2xn/ on line 243

Notice: Undefined variable: handle_code in /home/wp_f5v2xn/ on line 243

Notice: Undefined variable: handle_code in /home/wp_f5v2xn/ on line 243

How to Pre-Qualify Collection Cases to Make the Right Decision

You have an unpaid debt that doesn’t look like it’s going to get paid anytime soon.

What are your options?

You could continue waiting patiently, hoping it will come soon.

You tell yourself that the average wait time for payment is now about 72 days for small businesses, so maybe they’re not as late as you think.

You could start sending reminders and following up, praying your client will come around if you take measures to improve your chances of getting paid.

Or you could send the account to a collections agency and give your business its highest chance of collecting that payment.

[thrive_leads id=’818′]

Why Collection Agencies Work

Collections agencies come with years of experience and wisdom. They offer benefits like:

  • A higher chance of getting your money. Debt collectors are in the business of recovering money. They have tools and experiences that you don’t, and that can help you get your money.

  • Taking the stress and work off of you. Let’s face it; recovering a debt is time-consuming and stressful. By handing over your debt to a collections agent, it frees you up to do other things while they handle the hard work of getting your money.

  • They know the law. There are both federal and state laws that govern how a debt is collected. If you don’t know what they are, collecting your money could lead to some legal problems. Luckily, collection agencies know these laws inside and out, eliminating any legal risks and ensuring your business stays safe.

  • Thorough record keeping. Collection agencies have been at this a long time. They know to keep accurate records of all communication with your debtors, which can help you with future attempts. If legal issues arise, you can always look back at any documentation that shows the effort and measures you went through to obtain your payment.

But deciding to send a billing case to collections isn’t an easy decision to make.

On one hand, it will affect your client’s credit and will cause some resentful feelings towards you and your business. On the other hand, the longer you wait for the debt to be paid, the lower your chances are of ever seeing that money.

Pre-Qualify Collection Cases For Best Results

The best thing to do is to pre-qualify your case to ensure you’re making the right decision. Here are some questions to ask yourself:

How long does it take to collect

  • How old is this account? The older the account, the less likely you will get paid.

  • Have I sent reminders to get my point across that this money is due? Before consulting a collections agency, have you done your part to try to get this money?

  • Does the customer respond to phone calls or invoice reminders? Do you get any response at all from them?

  • Has the customer followed through with any part of your payment arrangement? If you have an agreement set up, has the customer paid part of the money owed or ignored your requests completely?

  • Does the customer deny owing me money or outright refuse to pay? This one is a huge red flag, and may need some legal action to acquire any funds.

  • Has the customer changed their phone number and address lately? If you can’t get in touch with them, you can't collect your money. Luckily, collection agencies have their own tools and tactics to help you in these situations.

When you have a delinquent account and a customer who isn’t responding, you may feel like you’re never going to see your money. Choosing the best next step might seem difficult.

You could either wait it out or turn to a collections agency. Before jumping in and hiring a professional, make sure you pre-qualify the customer to ensure you’re making the right decision.