Wednesday, 16 August 2017

Everything You Need to Know About Collecting a Debt

Want to know how to collect on that past due invoice? Don’t know where to start? Feeling awkward about how to approach the individual who owes you money? There’s no need to worry! This blog contains everything you need to know about collecting a debt. When it comes to debt collection, there are so many questions that we get asked. Some of these questions include – What are the benefits of referring a debt to a collection agency? How does the whole debt collection process work? Some of these big questions raise smaller questions too. Can a debt collection agency speed up the recovery process? What certifications does a debt collection agency have? At Pro-Collect, we want to answer all of your questions and help simplify the debt collection process. If you find yourself asking any of these questions pertaining to debt collection – this blog post is for you! Read along for more information, tips and tricks, and everything you need to know about collecting a debt.

Every business whether large or small, needs its cash flow to be in top shape. A significant part of cash flow for a business, is the recovery of bad debt. Sometimes bad debt can go on for way longer than need be. Whether this is a past due invoice, or hundreds of dollars in services rendered, the recovery of these funds is crucial to your business. This is why working with a collection agency, such as Pro-Collect is so important. At Pro-Collect, we believe debt collection should be simple, and efficient. Most of all, we want to make debt collection easy for you! Collecting on past due invoices and late payments is an important aspect of business. Tracking down those late paying customers and communicating with them is also important. Sometimes this can be tricky, but it is important to remember the benefits. There are many business benefits to collecting on old debts or bad debts. Some of these benefits include, increased cash flow, helping your bottom line, and increasing your profit. At Pro-Collect, we believe that all of these things are important factors to having a thriving and harmonious business. We want to inform you on how to collect on debt and increase your profit. Read on for more information on debt collection, and how Pro-Collect can help better your bottom line.

What are the benefits of referring a debt to a collection agency? This is one of the most often asked questions when considering how to collect on a bad debt. There are many benefits to referring a debt to a collection agency. Some include, improved cash flow, increasing profit, and increasing revenue.  By referring a debt to a collection agency, you can save precious time by speeding up the collection process. A debt collection agency can act fast, when you can’t! Handling the client on your own may take months, and you may never recover the outstanding debt. Sometimes a debtor can sit on a debt for 6-12 months and never do anything about it. They may forget about the outstanding debt, or even pretend to have lost track of it. The longer you wait to collect, the longer the outstanding debt will go on. You don’t want to waste time –  it is best to take action.  By referring a debt to a collection agency, you are communicating to the debtor that you are not prepared to wait any longer for repayment. If you’re going to work with a collection agency, make sure you’re working with a collection agency that places urgency on its work. Pro-Collect prides itself on instigating action right away. The longer you wait, the less likely you are to be repaid!

You may be wondering – why Pro-Collect? At Pro-Collect, we are passionate on collecting on bad debt. We offer professional account managers, who will work with you individually, on a case by case basis. Our account managers are assertive and professional. We think outside the box and specialise in communication. Even with the  most difficult of debtors! Remember that most debtors do not intentionally set out to ignore or not honour their debts. Sometimes, a little communication goes a long way.  Our account managers are equipped to handle consultation and communication between both clients and debtors. We want to achieve debt recovery just as much as you do! With the ability to lodge a debt online, it’s easy to sign up with Pro-Collect. We require is the debtor’s full name, current address, and e amount owing to lodge the debt.

What does a debt write off mean? How does a Pro-Collect work toward a no write off claim? By working with a collection agency, you’re not  completely guaranteed to preserve your customer/debtor relationship. Some business relationships may turn sour when bad debt is involved. Although we do our best to handle these situations with tact and great communication, we cannot guarantee to preserve your business relationship. The term “write off” is an accounting term, meaning that when business owners cannot collect on an outstanding debt, they can write it off. This means that  they are taking the outstanding debt, which is an assets to a business, and declaring that it is no longer worth anything to the company.  A debt collection agency can help  you avoid a write off, often times we can collect on these outstanding debts.  If you can collect on the bad debt, it will not become a 0.00 asset to your business. This is of huge benefit to your business! You will not have to write off the debt, but rather recover it instead.

How does the debt collection process work? At Pro-Collect, our  debt collectors are properly trained and certified for the job. All our account managers have their CAPI (Commercial Agent and Private Investigator) License. In NSW, this license is required for those who engage in debt collection, repossession of goods, and investigation of people.  A master License is required by law for the business in which debt collectors are involved. Each collector has an individual CAPI Licence, and Pro-Collect holds a master CAPI License for our business. Each debt collector does place checks, making sure that the people who are collecting are qualified to do so. As well, we offer in house training on the legal process and debt collection. Our professional specialisations are in finance and personal finance. Often, our collectors have an educational background in these specialisations as well.

How do I lodge a debt? If you are interested in lodging a debt with Pro-Collect, you can do so quick and easy online! You may also contact our office during regular business hours. We offer a form to submit via our website and will begin the collection process right away upon receiving your lodged debt. We will send you a proposal with debt collection instructions, and contact your debtor as soon as it is possible to do so. We collect 86% of debts under our debt collection services proposal. Pro-Collect has proudly collected on over 19,500 debts since 2007. We will send you a proposal and debt collection instructions. You may find yourself asking – how quickly after lodging a debt will someone follow up with my debtor? At Pro-Collect we believe that time is money. We will contact the debtor as soon as we received the lodged debt. In fact, if you lodge your debt before 4pm on a weekday we will send a letter to your debtor immediately. The first step in the collection process is to send a letter of demand to the debtor.  The letter of demand states that this is the first action against the debtor, and if they continue to leave the debt unpaid, legal action may be taken. Most often we can recover the debt as soon as 7 -14 business days. If, however, the debtor is more difficult to deal with, not at the given address, evasive, or argumentative, the process can take longer. Should it become necessary to take legal action against the debtor, Pro-Collect will appoint a solicitor to appear in court on your behalf.

When a debtor is ready to pay their debt, do they pay Pro-Collect or do they pay the business to which the debt is owed? Generally we encourage the debtor to pay through Pro-Collect. Often times if the debtor pays our client directly, there is too much delay in the payment process. If the debtor does pay the client, it is very important that the client inform Pro-Collect that the debt has been repaid. If the client does not communicate this with Pro-Collect, we may end up needing to charge the client commission, and any extra fees applicable. If this is the case, this is often sent as a bill sent to the client via mail.

There it is! Everything you need to know about collecting an outstanding debt and working with a collection agency. When it comes to bad debt, make sure to take swift action. By working with a collection agent, such as Pro-Collect, you are communicating to the debtor that you are not prepared to wait any longer! Your debtor will no longer be able to give you excuses, and you are showing that you are serious about getting your money back. Pro-Collect is an excellent debt collection agency in your area. Pro-Collect is a specialist debt collection agency, with over 35 years of experience. We help service clients in Sydney, the Central Coast, Newcastle, North Coast, and New England areas of New South Wales. Pro-Collect proudly assists with debt recovery anywhere in Australia. Should you have any further questions about how to collect on outstanding debt and how to lodge a debt with us, please visit the contact page on our website, or scroll on over to lodge a debt with us today!

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