How to find an efficient debt collection agency?

Running a business would be much easier if everyone paid up. Unfortunately, the problem of getting into arrears is really common, which holds entrepreneurs from efficient work, because of waiting for their money for a very long time. In such a case a person without the knowledge of the law has little chance of recovering the debt. A lifesaver can be a debt collection agency. How to find a good debt collection agency, which is efficient and reliable?

 

Check information about the debt collection agency

 

It’s recommended to start checking information about the company from official databases of entrepreneurs: Central Register and Information on Economic Activity (in the case of a sole trader) and National Court Register (in the case of copartnership). Thanks to the entry in the database you can learn who is the owner of the company and how long it operates. Without checking this information the cooperation can be risky.

 

Ask for references and the list of previous clients

 

Each industry has its unique character and demands a different approach to a debtor to collect debt successfully. Ask the debt collector about a list of previous clients and references. Check if these people are from your industry. If it’s possible, try to call them and ask about their experience of cooperation with the debt collection agency.

 

Make sure if the company carried out the verification of the debtor

 

Acceptance of the order without preceding verification of the debtor can be a sign of disorderliness and poor organisation skills. Thanks to verification a debt collection agency can prepare a more accurate and efficient action plan.

 

Read the contract carefully

 

The first thing you should take into account while reading is a kind of contract.  Debt collection agencies use two kinds of contracts. A contract of debt collection means that the liability remains your ownership for the whole time. That’s why the final decisions concerning the methods of debt collection (such as bringing a case before a court) are yours. In the case of a contract of debt assignment, a debt collection agency becomes the owner of the debt. If you deal with the second kind of a contract, make sure that there is no provision about deferred payment date, because it can mean that you will have to wait for your money for a long time. Look carefully at the terms of the contract denouncement and its consequences. Check if a scope of services embraces all stages of debt collection (arbitral, legal and judicial one), what is the cost of the case and who will be charged for it.

 

Check the area of activity

 

Some debt collection agencies work only on a restricted area for example in one region or in one voivodeship. The other ones work in the whole country or even abroad. If your debtor lives/works in another country, look for a company which specialises in debt collection in his area. The knowledge of the law of a particular country is crucial, especially when it is necessary to take legal action.