There may come a time when you decide to loan a substantial amount of money to family or friends and you do not receive your money as promised. You are clueless as to what your next step is going to be, but you need the money badly. There’s no need to worry because Personal Debt Collectors can do that job and make your life easy. Of course, there are times where you can avoid the debt collection process but when the debtor refuses to pay the sum he owes, it becomes inevitable to consult a professional. Like it is with everything else, it’s imperative to invest a great deal of time in deciding which agency you want to hire since each and everyone are wrapped up in a unique situation and hiring the right people can make all the difference in the world.
- Do your research:
Every agency is a specialist in a specific area. For example, some agencies are good at getting repayment of loans from large corporations while others work well with small businesses or even loved ones. It is your job to find out what kind of debtors the agency specializes in and choose accordingly.
- Legitimacy of an agency:
It is important for the agency you hire to possess proper documents to prove its legitimacy. Your agency must have a proper license and should adhere to all the rules as defined by the debt collection practices Act. Sometimes different places have different rules, so make sure your agency follows them all.
- The agency must have Insurance:
There’s a possibility that your agency might employ some real hard tactics and the debtor is not very happy about it. The debtor can then sue you. In the unlikely event that he/she does, get proof of insurance from your agency that you won’t be held accountable for hiring it.
- Skip tracing:
It’s a bonus if Personal Debt Collectors perform “skip tracing”. Some debtors evade paying back loans by skipping town and leaving no address to contact them. Agencies who use skip tracing have access to a lot of databases and can easily track down the debtor. This is very useful when you’ve been personally reaching out to the debtor but have received no response from them.
- Comparing fees:
Once you have looked up a couple of agencies that might work out for you, it’s time to compare costs. Agencies usually follow the two payment plans –
- Flat fee – in this type of payment, you would have to pay a fixed price quoted by the agency and this happens pretty early in the debt collection process.
- Contingency fee – this mode of payment is followed by most agencies. The Personal Debt Collectors follow “No collection – no fee” model where they charge anything between 25% to 45% of the total amount.
One thing to understand is that there’s no way of recovering the full amount after you hire a debt collection agency. So hiring Personal Debt Collectors should be your last resort. It can be really upsetting when debtors do not pay up what they owe. Therefore, It’s always better to leave the job to the professionals instead of wasting your precious time and energy.