When all your internal efforts have failed when dealing with past due receivables, it is time to seek representation from a professional. If you have proper accounts receivables policies and procedures you will most likely assign it to a collection agency first.
Most 3rd party collection agencies work on a contingency basis. You do not pay them until they collect. Their commision is based on a percentage of the dollar amount collected. This is beneficial since it avoids you having to spend good money in efforts of collecting bad money. A debt collection agency, when successful, will typically achieve results quicker, since there are no court dates involved. This also helps because the collection agency will make you a priority when the debt is still fresh in the debtors mind and there will often be less resistance given by the debtor.
A collection agency is structured and equipped to collect debt, not to file lawsuits as an attorney would be. They will have a set of tested and proven legal demand letters to send on your behalf. A collection agency will utilize tools and online services to skip trace, investigate and contact the debtor company.
An attorney can be a valuable asset in your collections process, but a lawyer should always be retained after your 3rd party collection agency exhausted their efforts. In the long run, your accounts would be in far superior shape and prepped for litigation once they are forwarded from your collection agency to your attorney. Remember, it’s a long walk up those courtroom steps, though sometimes a lawsuit is needed. Make sure your collection agency is your first line of defense when dealing with delinquent accounts.
Alexander Miller & Associates have over 60 years of combined industry experience. If you are dealing with delinquent invoices and need representation, contact us for a free consultation. If a lawsuit is necessary we can recommend a CLLA Attorney that will take the case. We look forward to earning your business!