To manage an establishment profitably, a part of your policy should include knowing when to outsource difficult accounts to a debt collection agency. Every owner has to stay on top of their receivables and check their cash flow. Whether you sell a product or provide a service, you probably experience late-paying or none-paying customers from time to time. That means that you have to have a good, uniform internal debt collection policy in place.

» One significant reason this is true is because your delinquent accounts continue to decrease in value, at a rate of 15% per month. And the longer an account goes delinquent, the more difficult and costly it is to collect. In addition to spending more time, capital, and resources going after these depreciating accounts, its also costing your company in lost opportunity dollars, by taking you away from your core revenue-generating functions. It is much more cost effective and efficient to outsource these problematic accounts to an unbiased third party debt collection agency.

Here are some questions you may want to consider when  hiring a debt collector:

1) Are they licensed in all 50 states?

Many states require a license to collect a debt in their particular state so its important that the debt collectors are licensed in all 50 states. What if one of your customers moves out of state? Well the collection could become rather difficult and if the debt collector attempts to collect it in a state where you are not licensed the ramifications could be disastrous for you and the collection agency.

2) Do they have insurance?

Ties into number one because collection agencies obtain insurance to protect themselves in case a member violates state or federal laws. It minimizes your company’s risk in case the collection agency makes a mistake.

3) What will be expected of me as a client?

Knowing what the collection agency requires of you is a good thing to maintain an effective working relationship. They are basically an extension of your company and you will want them to act accordingly so the same goes for you. Typically, the collection agency will want you to send them “clean” accounts receivable data, meaning all the balances due and documentation must be correct. Otherwise, it’s just about impossible to collect.

4) What technologies do they use?

You would obviously want the collection agency that you hire to have the latest and up-to-date technology. If they are using the most up-to-date technologies that most likely means they are looking for a long term goal of staying in business. The latest technology also proves more effective debt collection.

5) What do you do differently than other agencies?

There are thousands of collection agencies out there. Some big and some small. Many are great at collection debts but the main thing is what they do differently. Do they send you regular reports that make your company’s AR Departments lives easier? Do they customize their services to better suit your type of business? Ask them how long it takes them on average to see a return on monies owed.

These are some of the more important things to be asking yourself when choosing a debt collection agency. Every company has different needs and more than likely you can find an agency that fits yours.

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While the end of the year means holidays filled with celebration and family, it also means focusing on year end budgets and hitting targets. Holiday debt is created by overindulgence, which can be more troublesome when the debtor already owes a substantial amount of money. Often times in the spirit of the holidays, debts are pushed aside by either the debtor, the creditor, or the judgment holder. When people owe monies, such as debts, judgments, or even child support and spousal support, they tend to put things on the back burner in the name of the holidays. While we at Accounts Retrievable understand this phenomenon, we also understand how challenging this can be for a business or an individual that is owed money.

Throughout the years, the holidays are notorious for being troublesome months for collecting debts. People will simply not pay what they owe because they will buy presents and celebrate by creating holiday debt regardless of how much they owe to others.  It is possible to be in the holiday spirit and be empathetic to a debtor’s situation while also being firm in collections efforts. Sometimes people get caught up paying for things they need in the immediate moment and are so focused on the many lists of things that need to be done and simply forget they are in debt to anyone.

The goal of any business  owner or individual is to not end up with an increasing number of receivables in January after the buying season has slowed down. People are starting to pay off their holiday debts come January and leave their existing debts for a later date. It is important as a business owner or a debt collections agency to still be active in the collections process while being understanding of the time of year.  The most important tool you can use is to stay organized and keep on top of your receivables. Your debtors are likely to be unorganized this time of year so it is important that you maintain the organization needed to collect your money responsibly.

For those of you that have a complaint about debt collection, the Consumer Financial Protection Bureau wants to hear from you! The rules on how debt collectors communicate with debtors were recently updated. The debt collection business is booming ever since the recession and there have been many legitimate complaints from consumers. While collections is a process that is necessary for businesses and individuals to recover their money, there have been many problems that the bureau would like to clear up making the process easier for everyone.

The Fair Debt Collection Practices Act already protects debtors from being harassed, however this document was enacted in 1977 and requires some adaptation to modern times. The new rules seek to provide a fair balance between consumer protection and the ability of a creditor to recovery debts.

If you would like to join in the ongoing discussion, here are some resources:

Where to see complaints filed with Consumer Financial Protection Bureau:

The bureau has a Consumer Complaint Database on its website where you can view complaints.

How to submit a complaint:
The bureau website has a place to file complaints.

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Collecting child support for custodial parents is one step in establishing payments. When the custodial parents establishes child support, the local court office will conclude the amount of monthly payments the non-custodial parent will be obligated to pay. When the non-custodial parent receives their orders to pay child support, they must live up to their obligations or suffer the penalties.

Here are some steps to collect child support:

»The First Step is if you were not married when your child was born, the first step is to establish paternity – legally determining the father of the child. Many men will voluntarily acknowledge paternity. Either parent can request a blood test in contested paternity cases. Your caseworker will help you establish paternity for your child.

»The next step is to establish the obligation. State guidelines determine the fair amount of child support that the noncustodial parent should pay. Your child support office will be able to tell you how support amounts are set in your state. Your child support office can also request medical support for your child.

»The last step is to enforce the child support order. Our child support division can help collect your money no matter where the noncustodial parent lives.

Although the most successful way to collect child support is by direct withholding from the obligated parent’s paycheck, Federal and State Income Tax refunds may be withheld to collect unpaid child support. States also have laws that allow them to use: liens on real and personal property; orders to withhold and deliver property; or seizure and sale of property with the proceeds applied to the support debt. Many states routinely report child support debts to credit bureaus, which would affect the noncustodial parent’s credit.

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Judgments & How Collections Agencies Enforce Them

Once you have won a judgment, you are now considered the judgment creditor. As a creditor, there are many collection techniques available. In fact there are more techniques available than when you try to collect debts before getting a court judgment. Below are listed methods of collecting a judgment and limits to what property you can take.

Methods of Judgment Collection

Wage Attachment/Income Execution:

The first item we will go after is the judgment debtor’s paycheck through wage attachment or garnishment. This is a very effective technique when the debtor is receiving a regular paycheck. Even though a person receives a paycheck, they still may not be willing to pay for one reason or another. Through wage garnishment, you are sure to receive your money from the debtor before they get a chance to even see the money. Federal law allows a certain amount of the debtor’s earnings to be taken by the creditor, in most states. There are higher limits for certain types of debt, such as child support and income taxes.

Property Liens:

In most states, once a judgment is entered against a debtor there is a lien automatically placed on the real property they own in the county where the judgment was obtained. Instead of waiting for the debtor to sell their property, you the creditor can “execute” on the lien. This means having the sheriff seize the property and arrange for public sale from which you are paid out of the proceeds. This is an extreme measure that needs to be considered carefully. The expense and hassle of executing a lien may not be worth the return on the sale.

Property Execution:

A property execution is a way of taking personal items from your debtor in order to pay the debt owed. This is where you, as the creditor, can get a “writ of execution” from the court and go after the personal property of the debtor. Only a judgment creditor can levy a debtor’s property, so the judgment must be awarded first. After a sheriff takes the personal property (a baseball card collection, for instance) they will sell it and the proceeds will go to paying off the debt.

Assignment Orders:

An assignment order allows the creditor to go after property that cannot be subject to a levy. For example, this can be an anticipated tax refund or an annuity policy.

Limits on What a Judgment Creditor Can Take

This is something that varies state to state. The professionals at Accounts Retrievable will be able to navigate through the laws by utilizing our nationwide network of attorneys. Every state has certain property that is considered “exempt” from being seized by a creditor. You can learn more here about what is exempt from debt collection in New York State.

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It’s bad enough to deal with calls from a debt collector. However, a phony debt collector calling to scam you out of money is even worse. Recently, the Federal Trade Commission settled charges with a California man who worked with a fake debt collection company in India. He and the company deceived Americans to the tune of $5 million over two years. While that bogus operation has been shut down and criminal charges are pending, we can expect that similar scams are in the works. The good news is that there are many warning signs that can give away a phony debt collector. Accounts Retrievable would like to help you spot these scammers so that you and your finances remain safe.

–  One major thing to understand is that you cannot be arrested for having private debt. If you are being threatened with imprisonment or being told you are talking to a law enforcement officer, you can be sure it’s a scam.

–  If you start asking questions of the debt collector and the story starts to unravel, it is probably a scam. Fake debt collectors will refuse to provide a written “validation notice” of the debt. This is a required practice under the Fair Debt Collection Practices Act.

–  The most suspicious demand will be a payment using a transfer service such as Moneygram or Western Union. This is a huge red flag.

The people who are often targeted by these scam artists are usually people who are in financial unrest. The scam artists  are most likely getting information about these people from the internet so that they know who to target. They are counting on these people to be confused and overwhelmed about their debt and easily tricked by scare tactics.

Bottom line: ask a lot of questions and get your paperwork in order so that you know what you owe and to whom. These fake debt collectors are counting on people being unorganized and unaware of their rights. If you are educated and aware of your personal debt and the basic practices of a collections agency, then this is your best defense against a scammer.

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Who hasn’t Googled an ex by now or found long lost friends and family through Facebook? The technology for finding people has been growing rapidly in the recent decades. Skip tracing has been a common practice for judgment collections companies since inception but with modern technology, debtors are having a harder time staying off the collections radar.

Judgment collectors used to have to sift through phone books, make extensive calls, and hound the neighbors in order to carry out skip tracing business. However the professionals in judgment collections businesses such as Accounts Retrievable have been able to utilize the digital trail that debtors leave behind to enforce judgments. The debtor doesn’t even have to be in the same state or country as the judgment collection company because with use of a computer or even a smart phone, debt collectors can track anyone down. Even police enforcement agencies are utilizing social media and social networking as a viable tool for solving and prosecuting crimes.

People are becoming more and more dependent on their smart phone. The benefit to skip tracers is that these smart phones have GPS hard wired into them and every app or function is usually geo-tagged when in use. The lines of right to privacy are more than a little blurred in this growing technology but as a judgment collector, this can be used to benefit your creditors. Even if a person is not necessary checking in on apps such as Foursquare or Facebook, their location can show up just from posting or searching.

With a little bit of know-how, social networking can be a great benefit for tracking down debtors. We can even track down those who are hiding out in other states dodging their child support payments or the judgment that has been placed on them. Skip tracing used to be an impossible job that required a large amount of foot work and paper work.

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Call Accounts Retrievable System For More Info at (800) 327-4687