This Is News – All Debt Collection Myths Busted!

As a small businessman, you are always two minds whether to refer your debts to a professional collection agency or do the task yourselves. Sometimes, the amount in debt is just so small that you feel it worthless referring it to an agency. To make the matters worse, there are several myths prevalent regarding debt collection agencies.

Myth 1 – Using a debt collection agency means losing a customer forever.
This actually depends on the experience and approach of the debt collector. A collector who understands his job well knows that he has to collect the amount while helping you maintain your business relationships. By using this agency with a good track record, you can complement your in-house collection efforts while protecting your brand as well.

Myth 2 – Only big companies hire debt collection services.
Business of any size can hire these agencies to recollect its debt. Expertise of the businesses is related to their product or service, not to collecting money. Third party collectors increase the chances of collecting debts significantly. These Reliable agencies charge for the collected debts. So you don’t have to pay for debts which are not realized.

Myth 3 – Collection agencies should be used only after all your efforts fail to collect the debts.
The earlier you hire professional collectors, there are more chances of you getting back the debt. Related research shows that the debt referred to an agency at 30+ days overdue is several times more likely to be paid than the one which is overdue for more than 90 days.

Myth 4 – Hiring a lawyer is more likely to get result.
If a debtor is adamant on not repaying the debt, legal action is the last resort. However, it is most costly as well. Best option before you is to collect as much of money as possible at the lowest cost. This is an aspect a collection agency is expert at. You must not forget that you pay them only when they recollect the money from the debtor.

Myth 5 – Hiring a debt collecting agency is expensive.
It depends on the negotiations with the agency when you are through the process of hiring it. However, it always costs less than hiring a lawyer. If this agency expects large number of debt referrals from you, they might offer an even better deal.

Myth 6 – Some debts are simply too small to be worth collecting.
A creditor should never determine whether to proceed with debt collection based on the amount of the debt. This is an inaccurate yard stick to determine whether or not a debt should be referred to this agency. Every debt which has even a remote chance of being collected, must be referred to a professional agency to be recovered.

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