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tthomass
11-24-2008, 07:46 PM
Anybody ever dealt with collections? Do you have to be awarded a judgement first? How does it work?

Thanks.

mgugliotti
12-02-2008, 11:33 AM
You question can be complicated to answer as the terms you use such as "judgment" and "collections" have very specific meanings and uses in a legal context. I think however, that you are asking the simple question: "I have a customer that owes me money, I have proof via invoices sent to the customer, and receipts that are billed to that job. They have not paid me, can I send them to a collections agency based on that"? The answer is yes you can. Each agency will have a different requirement for them to begin working on your case, but call a few and see what they are. In addition, you might want to look at www.solidcontract.com, we require only a monthly fee and it may be far more cost effective than having a collections agency take 40%. Best of luck.
Matt Gugliotti
President
www.Solidcontract.com

shovelracer
12-02-2008, 01:36 PM
I'll add to this if you dont mind TThomas. Assuming you are going to go this route with a customer that is 90 days past on the oldest invoice and just over 30 on the last. They somehow slipped through the cracks of service stoppage. How many times and how often should you call, how many notices do you mail before beginning processing. It is assumed that you will not provide services again for this customer once they do pay.

I havent dealt with real collections agencies, but Ive had this local guy hounding me all year. He is one of those that just sends past due letters with no guarantee of money. Sure its only $10 per client but you need to buy 150. I can do that myself.

Farbio
12-02-2008, 07:07 PM
I use a collection agency when needed. 99% of the time it is for small lawn maintenance accounts with an average of $200-300 past due.

I first call any customers over 30 days as just a reminder. If I dont hear from them in a week, I send them a "nice" collection letter. It just states that if we do not hear from them soon they may be sent to the following collections agency. If we still dont hear anything after a week or so, we either send a more threatening collections letter or just turn it over to the collections agency.

If the agency gets the money in the first 30 days its free. After 30 days they take 20%. If legal action happens. They use there in house lawyer and take 50%.

Nobody wants to pay to collect money but it has been successful for me. We might use them 4-5 times a year.