Boost Your Bottom Line: Here’s How to Hire a Debt Collector

Chasing down delinquent accounts is no fun. It’s time-consuming, awkward, and can leave a bad taste in everyone’s mouth. But hiring a debt collector? Now, that’s a game-changer that promotes smooth cash flow!

Imagine outsourcing all those awkward “Hey, remember that money you owe me?” conversations to someone who actually enjoys making those calls. You’re basically hiring professionals to do the heavy lifting while you reap the benefits.

But here’s the kicker: finding the right debt collector isn’t like picking a new flavor at the ice cream shop. Choose wisely, and you’ll be swimming in recovered funds. Choose poorly, and well, you might find yourself needing a debt collector to recover the money you paid the debt collector.

That’s why today, I’m sharing a guide on how to hire a collection agency so your finances don’t go from frying pan to fire!

A Step-By-Step Guide on How to Hire a Debt Collector

The last thing you want while trying to recover your money from elusive debtors is to lose more money by hiring ineffective debt collectors. You need to make the right choice in order to right your finances. Here’s how to hire the right debt collector:

Step 1: Know your needs.

Before you start screening out debt collectors, you need to take a good, hard look in the mirror (and your books). What exactly are you looking for? How much debt are you being owed? What’s the nature of those debts? What about the age of the debts? Are they “fresh out of the oven” or past the statute of limitation already?

Assessing all these vital elements will help you understand your financial situation better and know what your options are. This understanding will, in turn, guide you regarding what to look for in a debt collector or the kind of lawyer you may need.

Step 2: Check their credentials.

You’re looking for a debt collection agency or special debt collector that fits your needs like a glove. Hiring an uncertified debt collector is like asking your neighbor’s kid to perform surgery because they’re good at it. So, once you pen down a list of collectors to choose from, now is the time to put on your detective hat.

Verify their respective licenses and certifications, particularly as they pertain to what your state requires. Then, check if they are compliant with the Fair Debt Collection Practices Act (FDCPA). You can also check for membership in professional associations (like ACA International). You don’t have to just take their word for it either. Call the relevant authorities to verify their credentials.

Step 3: Investigate their reputation.

Confirming their credentials is not enough. You also need to channel your inner teenager and do some serious online digging. What are people saying about the collector or a collection agency? Do they get good ratings? Do the online reviews seem genuine or made-up? All these questions need to be answered before proceeding to the next step.

One of the best places to investigate their reputation is the company’s reviews page. You can also check for complaints with the Better Business Bureau. Look for patterns in reviews. One bad review might be a fluke, but if everyone’s complaining about the same issue, it’s a red flag.

Step 4: Understand their methods.

Hiring a debt collection company that cuts corners and does shady things all in the name of “getting the job done” is a recipe for disaster. You might end up losing all the collected debt and more on litigation and penalties. Surely you don’t want a double whammy, right?

So, you need to get the lowdown on their debt collection process. Do they take the more “charming prince” or “fire-breathing dragon” approach? Ask about how they communicate with debtors. You also need to understand their policy on legal actions and credit reports. You may even role-play a collection scenario with them. If they make you want to pay debts you don’t even owe, they might be onto something.

Step 5: Confirm fee to pay.

Just as you need money to make money, so also do you need money to recover your money. But what fee must you pay to recover debts owed? Is the debt worth what you’ll be paying? Or are you on track to lose money? 

Payment plan is another key criterion to consider when choosing a debt collector or agency. You’re trying to get money in, not bleed more money out. So, ask for a detailed breakdown of flat fees for different scenarios. Ask about any additional costs or hidden agency fees. Don’t hesitate to compare rates with other agencies too.

Get the Perfect Fit: Here’s How to Test Debt Collector Skills

For debt to be successfully recovered, the collector needs to put a good number of skills and collection strategies to good use. How do you know if certain debt collectors possess these skills? You can simply test. However, note that testing these skills isn’t about finding a perfect 10 in every category. Rather, it’s about finding someone who has a solid foundation across the board and excels in the areas most crucial to your specific needs.

Below is a guide on how to test for debt collection skills:

Negotiation Skills

Here, you’re looking for the ability to strike a balance between firmness and flexibility in turning “I can’t pay” into “How about a payment plan?”

How to test it:

• Role-play a challenging debtor scenario.
• Present them with a complex case study and ask for their approach
• Ask about their most difficult negotiation and how they handled it

You may even throw in a curveball during the role-play to see if they can keep their cool even when the debtor is being unreasonable and intentionally annoying.

Communication Skills

Look out for the ability to communicate in a clear, professional manner. Also, check to see if he can adapt to different situations and personalities, especially those who stubbornly try to avoid paying.

How to test it:

• Ask them to explain a complex collection process in simple terms.
• Have them draft a collection letter for review
• Conduct a mock phone call with a “difficult” debtor

While you assess their communication skills, pay attention to their listening skills too. Part of a good debt collector’s job duties is being able to hear what’s not being said.

Legal Know-How

Assess whether the collector has a solid understanding of debt collection laws and regulations.

How to test it:

• Quiz them on key aspects of the Fair Debt Collection Practices Act.
• Present scenarios that border on legal gray areas and ask how they’d handle them.
• Ask about their process for staying updated on changing regulations

You can make the test a bit more interesting by throwing in a fake law and see if they call your bluff.

Tech-Savviness

Technology has come to stay and plays several key roles in our normal day-to-day activities. So, check to see if the collector is proficient with industry-standard software. Also, check if he has a knack for leveraging technology to improve collection efforts.

How to test it:

• Ask them to demonstrate how they’d use your software (or their recommended tools).
• Present a data analysis task to test their reporting skills
• Inquire about their experience with digital communication tools and skip-tracing software.

Emotional Intelligence

This skill is very important. Emotional intelligence refers to the ability to read people and the ability to manage their own emotions. This skill will also come in handy during tense situations so they don’t fly off the handle.

How to test it:

• Present scenarios with emotionally charged debtors and ask how they’d respond.
• Ask about a time they turned a negative interaction into a positive outcome
• Observe their reactions to stressful questions or situations during the interview.

The right debt collection knowledge helps to separate the wheat from the chaff and the pros from the pretenders.

But hey, why stop here? Your journey into the fascinating world of debt collection is just beginning! So, if reading this has got your debt-collecting senses tingling and your passion for financial justice burning bright, why not take it to the next level? I mean, sure, you could stop here and be pretty darn good at hiring debt collectors. But why be good when you can be great?

That’s why I’m inviting you to join Connection2Collections. On this platform, you get to rub elbows with the crème-de-la-creme of debt collection. You’ll also get the inside scoop on effective strategies that will fast-track your career. And these benefits are just the tip of the iceberg.

So, whether you’re an individual, a small business owner, or run a large enterprise, you’ll find everything you need to turn those financial lemons into the sweetest lemonade you’ve ever tasted! See you there!