Author Archives Marilyn Miller

What Does a Debt Collector Do All Day?

Posted by Marilyn Miller on September 24, 2020  /   Posted in Uncategorized
Morning Coffee and Promises

A debt collector does spend countless hours dialing for dollars. While telephone contact is a big part of what we do every day, it is only a small part of our plan to get our customers paid.

The first thing I do every morning is review the daily list of people who have promised to pay. A debt collector who sets debtor promises and diligently follows up on them. Some people do exactly what they say they will do. Others do it eventually, after several delays. Still others never intend to pay, and when they promise you, they are saying what they know will get you off them phone.

An experienced debt collector can differentiate between real promises and not-so-real ones. If someone does not pay on a given date, they can inquire as to the reason for non-payment, and perhaps work out a better plan for repayment.  For example, I recently spoke with a woman who owed my dentist client over $1,000. The first time we spoke, she told me she could pay in two weeks. I set the promise and followed up on the given day. I could not reach her for a week, despite multiple attempts. She did finally return the call, and told me that she could not make the payment. By carefully and compassionately questioning her, I learned that she did not understand that she did not have to pay the entire payment all at once. I was able to set her up on a payment plan of $ 100.00 a month, with payments scheduled to correspond with her biweekly paychecks. She stayed on schedule and paid the debt off as promised.

Customer Communication and Coaching

This week, I worked with an accountant to collect a past due balance. The debtor had paid half his bill, but had failed to make the second payment and had stopped responding. When we approached the debtor, who owed $2,500, he told me that he had been promised that he could pay only $700 to settle the balance. He had, in fact been told that, but when he failed to pay promptly the accountant believed his settlement offer could be withdrawn.

My accountant customer had an oral contract (for settlement at $ 700) with his customer. While oral contracts are valid, they are subject to the memory of each party in the event of a dispute. After fifteen years as a debt collector, I can assure you that in a dispute, each party will remember only the part of the deal that benefits them.

I advised my client to accept payment of $ 700.00. I advised the debtor (in writing) that we would accept the settled amount if and only if payment was made within a week. The debtor wired the money to the accountant the following day.

Afterwards, the accountant and I discussed how to document settlement offers in the future, that is, always put it in writing, lay out exactly how and when the debt is to be paid, and describe what will happen if payment is not made as promised.

My client took a little less money, but he got his money quickly and avoided a long, protracted dispute. He also learned how to protect himself in the future. I call that a good deal!

Skip, Skip, Skip to My Lou!

A big part of being a debt collector is research to find people and their assets. In our business it is called “skip tracing” and it is one of the favorite parts of my job. I consider skip tracing a critical part of my job, and I am really good at it.

Skip tracing combines using different sources (some public, others purchased) to find people or to make an assesment of their ability to pay. It is a critical part of our strategy and process.

If you are considering hiring a debt collector, you must ask about their skip tracing capabilities.

Legal Beagle

I am not an attorney but I work with attorneys nearly every day. Unfortunately there are times when the only way to collect a debt is to commence litigation and obtain a judgment. I have seen far too many judgments that are uncollectible for various reasons. Therefore, I spend a good deal of time choosing and preparing only the best files to send to our attorney partners. We assist by managing the legal process, especially post judgment collection.

So yes, there is a bit of a grind in making what can seem like endless phone calls, or stuffing and mailing hundreds of collection letters. However, the variety of tasks and my commitment to the right of my clients to be paid for their work keeps me going.

Collection Agency: Too Expensive?

Posted by Marilyn Miller on September 17, 2020  /   Posted in Uncategorized

No small business owner wants to send a customer to collections and we encourage to set up a program in-house to monitor and follow up on aging receivables. However at some point it is time to escalate the issues, and hiring a debt collection agency.


Many small business owners have never worked with a collection agency before and when I speak with them, they are curious about a number of issues such as how the process will work or repercussions to their business. One of the top questions, however, is how much debt collection will cost their business.











The cost of debt collection depends on a number of factors.

Most collection agencies use a contingent commission compensation model, which means their fee is a percentage of any sums recovered. No collection means no fee. Rates vary, primarily based on aging of the debt. The older the debt, the higher the fee.

If a debt is over a year old our collection fee is likely 50%. Is that too expensive? Well consider the following:

  • The value of your delinquent receivables is zero. Until you are paid, that receivable cannot be used to feed your family or grow your business.
  • You can use a customer contract to offset part or all of the cost of collection. Your contract must be signed in advance and must include customer’s agreement to bear all costs of collection. If you take the time to include this wording in your contract, your agency can add at least part of their fee onto the debt and collect it from your customer, depending on state laws.
  • Your collection agency agrees to attempt to collect the debt for you before knowing the financial status of the customer or any other factors that might limit successful collection. Try to think of any other business that gets paid solely on results. If you hire an attorney to sue someone, you pay rather or not you get a favorable result. If a contractor comes to your home to look at a project, you may often pay an hourly rate, even if you decide not to proceed. A public relations firm can write great press releases and place them in key publications, but they cannot guarantee you business will result. A collection agency cannot guarantee they will collect all the money for all the files you send them. However, if they are not successful you do not pay the agency. 

So with a guarantee of no collection=no fee, it is not a question of whether or not a collection is too expensive. It is a question of how can you afford not to give them the opportunity to collect for you?



Customer Credit: If You Build it, They Will Pay

Posted by Marilyn Miller on September 15, 2020  /   Posted in Uncategorized

Getting paid on time is every small business owner’s dream. However, many business owners  take for granted that their customers know how and when they want to be paid. Sometimes, they don’t. If you make communicate to your customers and make it easy for them to pay you on time, they will.

Remember the film Field of Dreams? The main character (an Iowa farmer portrayed by Kevin Costner)hears a voice in a cornfield one day. It says, “If you build it, they will come” Costner listens to the voice, mows down his crops and build a baseball diamond in the middle of nowhere. He builds it…and “they” come.

If you build system for getting paid on time, then “they” (paying customers) will come. I have been in the financial world for over 25 years, and I believe that most people want to pay what they owe. I also believe that the more effectively you communicate how and when you expect to be paid and make it easy for people to pay you, the more likely you are to be paid on time, most of the time.

I get my electric bill every month on the same day, by email. I can pay it with two mouse clicks. It is amazingly simple, and I pay it instantly every month.

Your payment terms must be clearly communicated to customers before you do the work, and then reinforced when you bill them. Use a contract, even a simple one, to outline your payment terms. It is not enough simply to payment terms on your invoice afterwards. Customer must agree in writing beforehand.

Once you have a customer, how do you make it easy for people to pay you?

  • Follow up with your customer immediately after the job is finished. Make sure you have the right billing contact. Use the opportunity to thank them and ask that they are pleased with your service.
  • Your bills must be sent promptly and must be easy to understand. Sending them consistently on the same day every month should be your goal. Remember, you are trying to build good paying habits with your customer, so show them your good billing practices.
  • Require a deposit before you start a project. Customers with skin in the game are more likely to want to continue paying.
  • As your customers how they wish to receive their bills. These days many customers want to receive their bills by email.
  • Offer a discount for prompt payment. You will be surprised how many people will take advantage of your offer.
  • Accept credit and debits cards, ACH, PayPalApplePay and any other method of payment.
  • Consider a payment portal on your website. I have one, and its use increases every month.
  • Offer payment plans. Make sure to document them, with terms for repayment as well as the consequences if the payment plan is not followed.

Getting paid on time is not really hard. You can control it, and you should.

Debt Collection and Leverage

Posted by Marilyn Miller on September 14, 2020  /   Posted in Uncategorized

I just received word from a client that a patient we have been trying to reach since last year paid her bill in full. The reason she paid is that she called the doctor to make an appointment and was advised that her account was in collections, and that she would need to pay it in full before scheduling an appointment. So she called us and paid.

Now, this patient knew she had the money because we sent her notification of the debt, and she had been promising to pay it for some time.  What made her pay it now? Leverage!

There are many factors that can be an incentive for customers to pay you. One of the most powerful tools you may have is leverage. Leverage is the ability to without future product or service until your bill is paid. Not all business owners have the opportunity to use leverage. If you do have leverage use it to help recover delinquent accounts receivables.

Do not believe that using leverage you have is a negative thing. You are not “holding it over their heads”. You are asking them to fulfill their end of the bargain. You would not have provided the product of service or product if you knew that you would not be paid for it. 

A classic example of using leverage to get paid comes from the movie Ghostbusters. A snooty hotel manager refuses to pay the exorbitant bill presented to him for the removal of ghosts from his hotel ballroom. 

Bill Murray’s character, Dr Peter Venkman, offers to return the ghosts, which, of course would be disastrous for the hotel. Leverage!

Sometimes people give away their leverage, making it more difficult to get paid. Yesterday I received a new business inquiry who had obtained a small claims judgment but had not gotten paid. As we spoke, I learned that the judgment was against his former wife, who lived in the house with him along with their children. He was not willing to change his living situation, and I told him I thought in his current situation he had very little opportunity for payment.

Similarly, too many small business owners continue to provide customers with large outstanding balances product of service. Although in some cases, particularly in the medical field, it is difficult, perhaps impossible to deny service, it is important to set limits. It is important to have a process to know when and how you can and will 

I have a new file on my desk today from a contractor who had the perfect opportunity to file a mechanics’ lien against a customer’s property. Instead, he waited too long. No leverage!

Another collection file I have is for an auto repair shop that let a customer take his car without paying anything. Now, six months later, the customer claims not to have money to pay his bill. I believe that he would have found the money had my customer required payment before they released the vehicle. No leverage!

Here are some more examples of customer debt collection using leverage successfully:

  1. Pediatrician requires payment on account in order for parent to receive camp or  school physical form.
  2. Orthodontist requiring full payment for braces to be removed.
  3. On first cold day, home heating oil company requiring full payment on old balance before new fuel is delivered.
  4. Manufacturer combining new orders at a discount if old balance paid.

In some cases you can cut a customer off entirely. In other cases, you may only be able to limit them. Whatever you do, make certain to always require at least some payment. Remember, every time a customer makes a payment, they add to the statute of limitations, the time period you have to legally collect the debt.

Eight Signs it is Time to Hire a Collection Agency

Posted by Marilyn Miller on August 27, 2020  /   Posted in Uncategorized

You have a growing small business, are “doing everything right”. You use customer contracts and have a good plan to recover bad debt in-house. When do you need to hire a collection agency?

Here are 8 signs it is time to get some outside help:
  1. You have a growing number of receivables over 90 days past due.
  2. You are spending too much time chasing non-paying customers and you do not have enough time for sales and customer service.
  3. You are having trouble paying your creditors because you are owed so much money.
  4. You do not have the cash flow to hire new employees or buy new equipment.
  5. Customers you have been billing move and you have no way to find a new address or contact information for them.
  6. You and your staff do not wish to be involved with customer disputes over payment.
  7. You have been going to small claims court and getting judgments, but are still not getting paid.
  8. Your accountant tells you that you cannot get a tax benefit from writing off your bad debt.

When small business owners to not get paid, it hits the community and people in the community immediately. Small business owners usually pay themselves last, and if they do not have the cash flow, they work for nothing. Heck – even President Trump has been accused of non-payment to small businesses.

Hiring a collection agency can save you time and put cash back into your business.

Debt collection agencies have resources to research and find people and their assets. They are expert negotiators who know how to handle disputes. They can set up effective payment plans and make sure people pay when they say they will. If you have obtained court judgments that you cannot collect, a collection agency knows how to attach assets, and execute court judgments using liens.

Hiring a debt collection agency may be the best business decision you make this year!

Adapt or Die: Not Just Darwin

Posted by Marilyn Miller on July 30, 2020  /   Posted in Uncategorized

It is not the strongest or the most intelligent who will survive but those who can best manage change” – Charles Darwin

On a lovely evening last week, my husband and I ventured out to a local restaurant near our home in Portland, Maine for the first time since everything shut down in March. We’re older, hence at risk, so we wore our masks and chose a place where we could eat outside and stay distanced from others.

It was so nice to be out in the world! We love the energy of the people on the street in Portland, and our adopted city did not disappoint. Most everyone wore masks, and most everyone greeted us with a nod or a wave. I think we all missed each other.

The restaurant we chose had made significant changes in order to keep their customers safe. Plexiglas dividers separated us from the staff. Menu was limited. We use paper plates and utensils (recyclable, of course). Tables were spread apart.

The experience got me thinking about my business – that of small business debt collection – and how business owners need to adapt their credit practices, not only to accommodate the current pandemic and economic uncertainty, but to align with the evolving habits of their customer base.

Adapt or die.

Here are some ways to adapt or refine your credit practices to meet the moment and prepare for the future:

Even when we could shake hands, the days of a handshake deal were done. Now more than ever it is important to make sure

All customer credit terms must be in writing. Medical practices must make sure patients sign an agreement stating that they are responsible for out of pocket costs. Payment plans should be documented, signed by the customer and witnessed.



When I started my business years ago, most people had landline phones and paid by check. It is important to speak to people in the way they are most likely to hear you. If you are not already doing so, collect email addresses, cell phone numbers and ask customers how they want to be contacted. Make it easy for people to pay you.  Want a “touchless” patient/customer experience? Set up an online payment portal. It will not cost much and you will see prompt payments increase.




Medical Debt Collection: Missed Appointments

Posted by Marilyn Miller on July 23, 2020  /   Posted in Uncategorized

We can imagine how frustrating it must be for you to sit waiting for patients who do not show up. It is disrespectful and costs you.


It may be appropriate to forward these patients to collections, depending on the circumstances. Here are some things to consider:


  • Did you communicate your policy regarding missed appointments to your patients? A well crafted office policy that reminds patients that you will bill them for missed appointments is a must. It should part of a larger patient financial agreement and should be signed by the patient. Simply posting it in your office is not enough.
  • Did you receive any notice from the patient as to why they did not show up for the appointment? Emergencies happen, and it is probably not a good idea to penalize someone for an emergency situation.
  • Is your missed appointment charge reasonable? It should reflect any out of pocket costs (eg, you had a specialist come in to do a test, etc.) and the length of time you set aside for the visit).
  • Is the length of time required for cancellation reasonable? Asking for a week’s notice may be a bit extreme. Only you can determine what kind of notice you require. Usually, 24-48 hours is appropriate.
  • Do you have a good service to record phone call cancellations? Our debt collectors tell us that most people say that they canceled the appointment. Do you have a way to prove that they did not cancel in time?
  • Is the patient a repeat offender? Many practices opt to forgive one missed appointment but will charge for any subsequent appointments missed. Your written agreement should clearly outline how it works. 
  • Is it worth your time and effort?

If you believe you can document and support a missed appointment charge, and you know that patients are aware of and have agreed to your policy, then it can be entirely appropriate to treat those files as collection files. We recommend you try to collect the balances on your own before sending them to a collection agency, and if you receive a dispute from the patient, make sure the collection agency knows that going in.

Yours truly,

Collection Agencies: How They Do What They Do

Posted by Marilyn Miller on July 07, 2020  /   Posted in Uncategorized

A collection agency is hired to collect a debt that is two years old. They make a phone call in an attempt to collect.  Upon receiving the call, the debtor (who had avoided contact for two years) immediately called his creditor and paid the bill (over $1,000) in full. The client called to report the payment, but also asked, “What did you actually do on this file?”


The answer is always the same:  “I did the exact right thing to get him to pay.”

Now my customer may believe that it was too quick and that I could not have possibly made it happen that quickly. I mean, it is possible that after two years, this person decided on their own to pick up the phone and pay their bill. What a coincidence that he did this the very same day we called!

It is impossible to say exactly what will “turn” a file.

Sometimes it is quick, and sometimes it goes on for years. Some people pay when they receive a collection letter, some wait for a phone call or second collection letter.  Some have to be taken through the legal process. Some are only collected through post-judgment collection by a lien or garnishment.

Many debts placed for collection will need to be researched. A collection agency has specialized tools to “skip trace” or research to find new information such as address or phone.

I like to look at my collection agency as a problem solver. Each file is different and needs a specific approach. If I receive a $10.00 file for collection, I can ill-afford to do more than send them one letter. If the debtor has no assets, the best option may be to get them on a payment plan they can afford. If the debtor has the means to pay and is just ignoring the debt, then litigation and post-judgment recovery make sense.

Yes, a collection agency sends letters. They make phone calls. Sometimes they report debts to the credit bureau. The key to success is that a collection agency will focus on the right strategy for getting you paid. Collection is all they do – and their focus makes all the difference.

Bad Checks in Maine: A Small Business Primer

Posted by Marilyn Miller on June 25, 2020  /   Posted in Uncategorized

Bad checks in Maine are very recoverable but it is important to know your rights and responsibility.

Some bad checks are a mistake, others are intentional. Basically, an unintentional error is considered a civil matter, and an intentional bad check issuance is considered a criminal offense. In either case, the person who issued the check is legally required to make good on the check, or face civil and/or criminal penalties.

A bad check can be either a check issued that is returned for insufficient funds or a check written on a closed account.

Maine law is very specific about the process to recover a bad check. You must send a letter to the issuer using this specific language from Maine statute:

Your check, draft or order made payable to _____in the amount of  _____   has not been accepted for payment by _____which is the drawee bank designated on your check. The check is dated _____and it is numbered ________.

You are CAUTIONED that unless you pay the amount of this check within l0 days after the date this letter is postmarked, you may have to pay the following additional costs: 

  1.   Attorney’s fees;
  2.   Service costs;
  3.   Processing charges;
  4.   Interest; and
  5.   A penalty not to exceed $150.

You are advised to make payment to the address on this letter. Payment must be for the full amount of the check and must be in cash or certified funds.

This language is mandatory. As you can see, if the check goes unpaid after 10 days, you are entitled to various fees and costs. If you are not paid within the 10-day period, you can contact the authorities. Your local police department is a good place to start, although come cities and towns will refer the matter to the country sheriff. DO NOT be afraid to take this step. It does not necessarily mean that the person will be arrested. It may be just the incentive your customer needs to make good on the check.

Some other things to remember:

  1. Ask for repayment in certified funds.
  2. We recommend full payment only. If you take partial payment, you may void your ability to employ other civil and criminal penalties.
  3. If someone issues you a second bad check within a year, you may be entitled to additional funds, but you will have to go through a notification process again. However, we recommend you do not take a second check from someone who has bounced a check on you – certified funds only. Fool me once…
  4. If you do get the authorities involved, stay in close contact with them and notify them immediately if you get paid. This is very important, especially if the police would be pursuing criminal charges.
  5. Your customer contract should address bounced checks and let them know that you will pursue all lawful remedies available to you.
  6. Make sure you take contact information from anyone issuing you a check.
  7. If a check looks funny to you, ask the customer to wait while you call the bank to check.
  8. Do not take second or third party checks.
  9. If you decide to hire a collection agency to help you collect the check, provide them with copies of the bad check (both sides) and your correspondence.

There are check clearing services you can purchase, but they may be expensive. Your best bet is to have a clear and consistent policy for both accepting checks and for handling bad checks, and to make sure that you communicate it to your employees and your customers alike.

How Long Can You Collect a Debt in Maine?

Posted by Marilyn Miller on June 10, 2020  /   Posted in Uncategorized
What is the statute of limitations for debt in Maine and how is it important to your business?

I have written a great deal on the many issues that could arise if you fail to monitor your accounts receivables diligently or if you wait too long to hire a debt collector or use the small claims court to recover money owed to you.

One of the most difficult conversations I have with small business owners is telling them that the statute of limitations has run out, and the debt is now not collectible. The statute of limitations is the period of time you can pursue a debt owed to you.  In Maine, the statute of limitations is 6 years. The statute of limitations in Maine begins 6 years from the date of service, or if payments have been made, the statute begins the date of the last regular payment. Why anyone would wait 6 years is beyond me, but it happens all the time.

Some people get busy or do not have the appetite for bad debt recovery. Still others may feel the effort involved is not worth the potential recovery if the person or business does not have money or assets to pay what is owed. However, just because they do not have the means today does not mean they will not have them tomorrow. Similarly, if you believe there are available assets, if you take your claim to a Maine court and are awarded a judgment, your judgment is good for 20 years. Any number of things can change in 20 years.

Of course, if you get a judgment it will not collect on its own.

You have to continue to reassess the debtor and look for assets. Here is a case in point.  We received files from half a dozen business owners who were all owed money by the same person. All his assets were over-encumbered, and there appeared to be no way to recover anything at all. Some of the businesses went ahead and sued the debtor, while others did nothing but wait. After a few years, the debtor received a large monetary award. Those creditors who had monetary judgments were able to immediately attach the award and recover their money. Sadly, those who had waited could recover nothing because the statute of limitations had expired.

You certainly cannot afford the time or expense to take every case to court, so it is important to choose wisely. Sometimes it is a leap of faith, or a feeling that your customer will one day have the ability to pay, and other times it is just luck.

There are also many small business owners who are unaware that they have 6 years to pursue collection of a debt.  Of course, the longer you wait, the harder it may be to find the debtor, and you will pay a higher fee to the collection agency, but something is better than nothing.  If you do place an older debt with a collection agency, make sure they have the ability to “skip trace”, or locate your customers, since people are increasingly mobile in today’s world.

I do not mean to recommend that you wait 6 years.

You have a problem if you have not been paid after 90 days, and you need to take action. Remember, those aging receivables sitting on your books cannot feed your family, pay your employees or grow your business. Cash flow is king, and you can control it.

  © COPYRIGHT 2020 United Obligations
^ Back to Top