Many businesses these days provide credit to customers. Unfortunately, all too often customers pay late or not at all, which can be very damaging for the cash flow of a business. Not only that, but it forces business owners to take on the adverse task of debt recovery. If you have outstanding customer debts that you havenít been successful in recovering, then the following are some the steps involved when using litigation to effectively retrieve your money.
The student loan debt crisis has become a drag on the economy. Younger Americans who are saddled with bankrupting payments ó or credit ratings damaged by delinquency ó are in no position to buy homes, save for retirement or start businesses.
The Federal Reserve Bank of New York recently released a study showing just why many young people are being strangled by student loans. It found that 43 percent of 25-year-olds had student debt in 2012, an increase from 27 percent in 2004.
Debt collection is an unfortunate albeit necessary business undertaking. If you have clients with outstanding debts owed to you, then you are legally entitled to pursue them for payment. When it comes to undisputed debt, itís encouraged that you and your debtor negotiate realistic payment arrangements yourselves, such as paying by installments. Of course, if a debtor still wonít pay Ė or refuses to pay Ė you may be tempted you to take more drastic action. Before you do, however, know that it is possible to go too far when recovering a debt, as some tactics could actually be illegal. Read on to ensure that your debt recovery tactics are within the arms of the law.
On February 9, John Monderine, CEO of Rapid Recovery Solution, comments on an article published by CNN Money, which lists some of the recent unprofessional ways collectors are going after debtors.
According to the article published by CNN Money, the Fair Debt Collection Practices Act forbids collectors from threatening debtors by using violence, explicit language, continuous calling, inflating a debt and posing as lawyers. The laws also state that a collector canít tell debtors they will arrest them or take money from paychecks unless ordered by a court.
The Federal Trade Commission today announced the results of the first empirical study of debt buyers. In January 2010, the FTC asked several prominent debt purchasers to submit information about their portfolios.
Most organizations face debt recovery problems. These problems mainly arise from a lack of a coherent approach to expedite customer payments. The problem gets even worse with most businesses adopting an ad-hoc approach towards debt recovery.
Collection agency services are a powerful debt collection tool for business owners whose primary concern is their companyís financial well-being.
As a business owner who is owed a debt for a service or product provided by their company to a customer in good-faith, there is a great temptation to personally pursue the debtor to recover the money that was earned. Often this leads to continued and open-ended spending to try to recover debt and wasted employee time.
If you are a debt buyer and find it necessary to outsource a piece of your portfolio you may have to start paying a higher contingency fee to get the best service. Not since the start of the new millennium have contingency collection agencies seen respectable fee percentages to work older stage placements.