Why use a collection agency?
Debtors will often pay a collection agency even though they never cooperated with the original creditor, mainly because collection agencies typically increase the psychological anxiety associated with a debt. Second, the debtor will understand that the creditor is serious about collecting their money. Also, many debtors are wary of the impact that a collection account can have on their credit score.
What are your overall collection success rates?
There are several variables that will influence recovery rates: the age of the debt is arguably the most important factor. The older the debt is, the lower the chance of recovery. Other important variables include: industry, balance, documentation, demographics and type of debt (business-to-business/retail/health care, etc.).
How quickly will you collect my money?
Claims are entered within the first 24 hours and the first collection notice is mailed immediately thereafter. This notice is followed up with subsequent phone calls and additional letters. Some debts are collected in the first 2-3 days while others may take up to 2 or 3 years! There are skips (cannot locate debtor), debtors who dispute the debt and debtors who are simply uncooperative.
Communication is very important to me. What type of reporting do you offer?
Preferred offers many different reports to our clients. Our system allows us to create specialized reports based on the needs of the client. Our standard reporting package includes: acknowledgement report, monthly payment report, cancellation report, and history analysis report.
What if my debtor disputes the debt or simply refuses to pay?
If the debtor disputes the debt, Preferred will provide them with verification of the debt. Depending on the dispute, we may have to request additional documentation from you, the client, in order to properly verify the debt. If the debtor simply refuses to pay, we will report the debt to the credit bureaus. We receive many payments each week from debtors trying to clean up their credit rating by paying off old debts. We will also review the file to determine if litigation is advisable and, upon client approval, we will forward the file to collection counsel. Relevant factors to consider prior to commencing litigation include: good documentation, balance, cost of litigation and a good address to serve the debtor with the lawsuit.
Will Preferred handle my claims all the way through the collection process, including legal?
Yes. Preferred will attempt to recover your claim even if it is legal. In the event litigation becomes necessary, Preferred will forward your files upon your authorization to collection counsel. We will keep you updated as to the progress made by the attorneys who are working on your behalf. Our clients appreciate the fact that we take care of everything throughout the collection process, especially the legal process since many people are not familiar with the complexities involved in a lawsuit.
How important is the age of a debt?
The age of a delinquent account is one of the biggest factors in determining whether or not a debt gets paid. The older the debt, the harder it is to collect. Research on the collectability of delinquent accounts clearly shows that the most advantageous time to enlist the services of a collection agency is within 60-90 days of the invoice due date. Incorporating this strategy will help ensure maximum recoveries with the least cost to your company.
My Company is very customer oriented. Can you collect without damaging goodwill or jeopardizing future relationships with our clients?
Yes, we can. Preferred was founded under the concept of conducting business as an extension of your business office. We take great pride in our relationships with your clients. We recognize that clients are hard to get and even harder to keep, so we use techniques that are ethical, fair, professional and effective.
What sets your firm apart from the many agencies out there?
Founded in 1985, Preferred has seen significant growth over the years. This growth is attributed to two areas: experience and service. Paul Read, our President and Founder, set out to establish a company that was concentrating on the rights things. After 20+ years as a Director in the receivables arena, he recognized a lack of quality service from his vendors, so he jumped to the other side and started providing exceptional service. His direction caused Preferred to strive to a level of professional service unmatched in our industry. Our techniques are ethical, fair, professional and effective. It's not just what we do, but it's who we are.
How long have you been in business?
Preferred is a privately owned company that was founded in 1985.
Does your company charge an annual fee?
I have some good news and some great news. The good news is that there is no annual fee for our services. The great news is that our fees are generated solely upon collections, so you don't pay unless we collect.
What is your fee?
We want our relationship with you to be "win-win," so we do not have a set fee. Our service is personal, so we look at each client individually. Our fee structure is based on the age and balance of the claims. A high average balance and an earlier age improve the collectability. That, in turn, improves your fee structure.
What is your process for collection?
Once a claim is forwarded to Preferred, first contact is initiated within 24 hours. Our efforts continue through letters and timely phone contacts until the account is resolved by one of the following outcomes: payment in full, payment arrangements made, settlement made, litigation necessary or efforts exhausted.
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