How a collections agency can fix the finances of a company

A company’s finances can be in disarray for a myriad of reasons. Sometimes, calculations go wrong. Sometimes, that’s just the way the market is. Sometimes, it can be controlled, and sometimes, it can’t. But there are solutions to most of these problems. One such solution is hiring a collections agency. Here are two ways they may be able to help. 

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Collection of payments 

The most important (and most obvious) advantage of hiring a collections agency is for collecting payments. After all, the collection of payments for products or services rendered is the goal of the company. A business cannot run if it doesn’t collect anything. A collections agency takes a huge load of company employees who no longer would need to call or write letters to delinquent clients or accounts. 

Legal protection 

Debtors are generally more afraid of collectors than business owners since collectors have the power to report unpaid credit to the authorities. Many debtors care about their credit score and would rather stay away from this. Some debtors though may choose to go to court to dispute collections. Collection agencies are not afraid of this since they’re armed with the vast knowledge of Federal and state laws. 

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Brennan & Clark is a collections agency and a member of the Commercial Collection Agency of the Commercial Law League. The firm offers unparalleled service and the most comprehensive guarantee in the industry. Learn more about the company and its services here.

Know Your Debt Collection Rights: A Guide To The Laws That Protect You

Having your account transferred to a collections agency does not signify the "death" of one’s business. Financial analysts understand that there are mitigating circumstances that may cause a company to be late in its payments. That said, many executives take the hit rather seriously and consequently ignore the realities of the situation. This includes not knowing or understanding their rights. Reputable collections agencies remind their clients on both sides that they strictly abide by mandated laws. There are laws that limit what debt collectors can say or do.

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The Fair Debt Collection Practices Act (FDCPA) defines the limitations on what every debt collector can do when collecting particular types of debt. The federal law also describes how debt collection is reported in credit reports all with specific state protection policies. The FDCPA encompasses the debt collection of mortgages, credit cards, medical debts, and other debts that for personal, family, or household purposes.

There are many stipulations recorded in the FDCPA, but all of these policies are based on the foundation of protecting consumers from debt collection companies that use abusive, unfair, or deceptive practices to collect debt. While the FDCPA does not cover business debts, company owners should know that unlawful or abusive acts of business debt collection agencies such as calling at irregular hours or practicing rude behavior are still considered unlawful. For these cases, entrepreneurs can speak with a legal professional to see what actions can be taken. It is highly recommended though to talk to the collections agency first before considering any legal action. Usually, the company will handle its representatives personally. However, if there is indeed a discrepancy between the company and the collections agency, it may be best to seek a mediator. It is also suggested to keep a record of all correspondence as proof of evidence.

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One of the reasons Brennan & Clark Collection Agency is a leading collections group is their transparency in all of its actions. For more on business debt collections, visit this blog.

Handling Chronically Delinquent Clients: Tips For Small Business Owners

Unlike most clients that are sometimes late in payments for legitimate reasons, chronically delinquent clients habitually pay late, pay rarely, or in some cases, never pay at all.

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Serial late-payers are the bane of businesses of every size. Delinquent accounts, however, are a particularly serious problem for small businesses. Having enough habitually delinquent customers compromises a small business' cash flow. To make matters more difficult, small businesses rarely have the tools and expertise needed for collecting on delinquent debtors.

The following are some tips for small businesses dealing habitually late-paying customers.

Have a process in place

No matter how small a business is, it must develop and follow a clearly defined set of policies for late-paying customers. These procedures must include details such as payment deadlines, late fees, and frequency of payment reminders.

Note that there shouldn't be a one-size-fits-all approach to all late-paying customers. A customer who regularly pays on time but forgot to drop a check in the mail for the last bill is dealt with differently than a customer who has never paid on time.

Communicate well and often

Businesses must invoice their clients on time, and clients with a history of late payments must be contacted on the date the payment becomes overdue, preferably over the phone or face-to-face instead of through email or regular mail.

Business owners should calmly yet clearly inform a late-paying customer about the overdue bill, ask for his reasons for paying late, and ask him to commit to paying the amount owed at a date both parties agree upon.

Consider hiring a collections agency

If a client refuses to pay or ignores all attempts at communication and negotiation, and his or her account is past due by more than the acceptable amount of time, business should consider hiring a collections agency. Taking a client to a small claims court can be time-consuming and costly, whereas collections agencies take care of the legwork when it comes to chasing after late-paying customers.Collections agencies allow businesses to get on with more pressing matters while recovering delinquent debts.

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Collections agencies are typically paid either a percentage of the debt recovered or a standard amount of commission for certain types of debt. Others charge monthly rates, while others offer the same services for a flat fee.

Brennan and Clark offers customized account receivables support solutions that eliminate credit losses. To learn more, like this Facebook page.