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.

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