“Why would I need a debt collector?” you may ask. Trying to collect your own outstanding debt can be awkward and can be detrimental to the working relationship you have with your clients. If your clients don’t pay on time, you follow up. Friendly this time, as it’s the first time they have paid you late. But it keeps happening. This is when you need to hand over bad debt. In order to maintain your working relationship among other reasons.
When handing over bad debt you can request the correspondence to be friendly. Friendly reminder letters and emails can be sent, where we ‘assume’ that the late payment was an oversight and request payment.
Here are 7 reasons why you need a debt collector:
1. Working Relationship
To ensure that your working relationship with your client doesn’t deteriorate. If you hand over the matter you won’t need to entertain any queries or excuses, which ultimately means that this won’t affect the relationship.
2. Time efficiency
Your main focus is keeping the ball rolling in your business- a debt collectors focus is collecting debt. A professional knows the best techniques to legally motivates debtors to pay. A law firm poses a much greater threat to debtors than you do.
3. Better, faster results
Debt collectors spend a full working day doing just that- collecting debt. You may have been spending an hour a day calling and following up, but they still haven’t paid. This is when to hand over bad debt. Sometimes it just takes a different voice and approach to seal the deal. Debt collectors have different approaches and techniques, this may lead to better results.
4. Neutral middle man
When handing over a debtor, collectors can act as the middle man between you and the debtor. If there is a dispute you feel isn’t relevant, collectors can act as mediators. Phrases like: ‘I hear you, I understand, however your contract states the following’ and reminding a debtor that there isn’t anything more water tight than a contract and nothing else will hold up in court over the contract, generally sealing the deal.
5. Legal protection
Debt collectors follow the Court rules in term of collections, all correspondence and records are kept. These documents demonstrate to the court the extensive effort behind attempting to collect the debt and may have evidentiary value in Court when the need arises. Should summons be issued and the matter proceed t trail these documents come in very handy.
6. Your debtor has disappeared
Do you have a debtor that just doesn’t pay and suddenly their phones are off, no response is received on emails, you have no way of obtaining their details or they simply jut simply ran away? This is when you need to hand over your bad debt in order for the collector to do a thorough trace to get the latest information. The first call he will receive regarding the account he thought he dodged, is a from a debt collector. ‘We found you, you still owe the money and now you need to start paying’.
7. They just aren’t paying
This is the most obvious time to consider handing over your debt. They aren’t paying. None of your efforts paid off and this just isn’t fair. Hand over the debt, you will be surprised how much easier this is than to keep attempting to collect it yourself.
It’s no secret that debt collectors have a reputation. But here’s the thing, collectors know what they are doing, they are target driven and want that money in just as much as you do. They are professionals!
So next time your debtors give you one too many headaches, consider this article.