A good collection agency does a whole lot more than just send letters and make phone calls. If you’re working with a good one, you can trust that your agency will do these 3 things for you:

1. Follow all federal and local laws

This might seem obvious, but a bad collection agency may not know that it’s doing things that violate the law! The last thing you want is for your delinquent customer to be able to wiggle out of paying his bill because your collection agency made a mistake.

And, remember, there are more than just federal laws to worry about. You may have to deal with different regulations, depending on the state you live in. So, a California collection agency might do things differently than a New York agency. Even if you don’t hire a California collection agency, you’ll need an agency that’s well-versed in California law.

2. Manage your debts for you

If you run a small business, you probably don’t have a dedicated bad debt management department. When a client skips out on his bill, whoever is put in charge of tracking him down is doing so in addition to all of their other responsibilities.

However, bad debt management can’t take a backseat in your business. If it does, you’ll wind up missing out on tons of profits that are legitimately owed to you!
That’s why a debt collection agency can be so helpful.

You can actually outsource your bad debt management to them. In return for a fee, they’ll send out past-due bills and keep track of customers before they’re too delinquent. Then, if things have to escalate to a full-blown collection process, your agency will already be working on the case!

3. Forward your case to an attorney

Sometimes, people ignore the efforts of a debt collection agency altogether. While bad agencies will throw up their hands and tell you nothing else can be done, the good ones will have attorneys on hand that can take over. That way, you can choose to file a lawsuit against your delinquent client, if you want.

By working with a debt collection agency that also has a staff of attorneys, you don’t have to worry about spending time looking for a lawyer. Instead, you can focus your time and energy on the customers who do pay their bills – and leave the bad ones up to your collection agency.