Go away my debt to a debt collection agency tenant is not my first choice. I first noted the debt Experian, Equifax and TransUnion, and let the borrower's credit Diender work a few months before he gave it to an agency that will charge me a fee high.
The collection of the occupant of the debt is very different from a collection of other debts, like credit cards. Collection agency represents you and your businessand could be brought before the courts would violate the law. And as important as any legal matter, and how well they will collect your debt.
He worked in industry for 12 years and believe that collection agencies work harder, ethical and in accordance with the law. But as in most industries, there are agencies that consider renegades. They operate outside the law, or right on the edge. Unfortunately, these companies get all the press,by all agencies in a bad light.
The fact of the matter is that the collection industry's fulfills a critical need in business. Imagine if everyone could stop paying the bills without repercussions. Do you think the money from the lending banks anyone? And so the prices of all goods and services?
These are what I consider the most important factors in hiring a debt collection agency for the tenant:
o Has the agency had not established that the FederalTrade Commission (FTC) violations? The FTC investigates and regulates the collection industry, more than one violation that concerns me.
Or is the agency licensed in all 50 states? Although this is not necessary to do business, help me to resolve this issue with the companies that have national presence and are large enough to meet many state requirements.
or does the company bonded and insured? If the company does not carry a minimum of $ 1 million liabilitySure, I give them my business.
The agency, or membership in the American collection? Again, it is not necessary for the functioning of the sector, but may show the level of interest and participation in the company in its industry.
The ratio of debt or agency Experian, Equifax and TransUnion? This is one of the largest collections agencies use to motivate a debtor to pay its debt or. Not all reporting companies.
o What type of debt is the company specialized in? The list of the types of agencies, debt collection is very broad. Consumer can collect or trade debt. Consumer debt can be a car loan, credit card bills, mortgages, medical expenses, rent, etc. To do a good job of collecting tenant debt, understanding the terminology and the business is critical. Very few in the country specifically collection agencies specialize in collecting such> Debt.
The company collects and judgments as well as non-judgment accounts? Few firms that collect debt owners to collect two types of accounts.
Or work for the life of the account bill? E 'among the agencies to work more recent accounts are the most difficult. How old was taken into account, is considered less of a collection. Often, agencies will work hard to have eight to ten months, after which they are based almost exclusively on the credit information bureauto help collect the debt. It costs a company more than a collector of old scores work, so expect a good agency to charge a higher rate. I want a company that works for the bill, as long as legally possible. If the report debt to credit agencies is necessary to collect the debt, I can not do that very easily and cost myself without having to pay fees.
The accounting agency or prejudice? In industry this is known as "qualifyingpaper." Amazingly, at least one company that specializes in tenant debt brags that they rate accounts before they even begin collecting them. This allows the company to spend it's time and resources on debts they "believe" are the most collectible. This reduces their overhead, but does nothing to help many of their clients. Landlords that lose out are those that rent average apartments to everyday average people. Do you want to hire an agency that only focuses on high-end properties, with well-to-do debtors? You would get about the same amount of effort if you reported the debt to Experian, Equifax and TransUnion yourself, for a lot less money!
o Does the agency accept collection accounts from independent landlords? At least one of the few nationwide agencies that specializes in tenant debt will only take on clients who own or manage a minimum of 100 rental units. This is because they do not want to be bothered by customer service calls from independent landlords.
o Will the company provide you with references from other landlords who use their services? References are important so that you may learn not only how well the agency collects your money, but also how they treat their clients. I have known of agencies that treated their clients poorly when they called with a question or concern.
o Does the agency you interview boast about how much better they recover debt than other companies? If they do, run! Run for a couple of reasons: If indeed they do collect more than other agencies, how do they do it? Do they threaten debtors and violate the Fair Debt Collection Practices Act (FDCPA)? This could increase the chances of your being dragged into a lawsuit. Likely their boasting is merely a sales ploy, and a cheap one at that. An overall average of how much they collect means about as much to you as what they had for breakfast. Plus, you have no way to verify their claims. The truth is that is no one can predict how well they can collect for you until they look at your accounts and work on them for awhile. In fact, it may be a couple of years before you can realistically evaluate whether the company you hired was effective. This is why doing your research up front is so very important.
o Does the agency charge you a fee to take on your debtor file? Unless they can justify the charge, and it seems as if they are an excellent company, I would continue looking for another company.
o What does the agency charge for collecting your debt? This question comes last, because it is the least important; but, it is often the first question I am asked. When I am asked this question first, I know I am talking to someone who does not know what else to ask. The fact is that you may find a company that charges 30 percent of what they recover. But, for 30 percent, they are limited in the resources they can commit to collecting your debt. Would you rather see a recovery of 30 percent of nothing, or 50 percent of a $3,000 debt? Do not be fooled by a very low commission rate.
I realize that this is a very long list of questions and concerns. But, once you have done your homework and hired an agency, you can get on with the task of running your business and not worry about it further.
A good portion of tenant debt is recoverable if you and the agency you hire do your jobs. It may take some time to collect what you are owed, but recovering lost profit at any point is icing on the cake.
Again, sending an account to an agency is not my first choice for collecting tenant debt. My philosophy is that I would report the debt to the credit bureaus myself and collect the easier debt. After several months, when I had already collected the easy debt, I would give the account to a reputable agency and let them get to work.
Contact me with your specific tenant debt questions and I will try to help.
Bill@thelandlorddoctor.com
Bill Gray
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