You may be generally familiar with the idea of debt collection, but it’s not until you need the services of a debt collection agency that you become really knowledgeable. Here’s what to understand about debt collection, including the difference between first and third-party debt collection.
Debt Collection — A Defintion
Debt collection describes the process of collection on money that’s owed to a business by an individual or another business. The companies that specialize in this service are known as collection agencies, but there are nuances to the term. It includes both first and third-party debt collectors, and can even refer to the kinds of companies that buy debt directly from a company for a percentage of their value, and then try to recover that debt for themselves.
Some debt collection companies specialize in certain industries, while others have the experience and tools to be successful across multiple industries.
First-Party vs Third-Party Debt Collection
A “first-party” debt collection is part of the original contract — the other half is the consumer. A first-party collector will usually try to collect a debt for months before bringing in a professional, third-party agency.
Here in northern Nevada, Business Professional Collection Services has worked with companies in multiple industries as a third-party collection agency for decades. Companies turn to us when they’re dealing with unpaid invoices and customers who are avoiding their attempts at communication. As a third-party agency, we weren’t part of the original contracts, but we’re committed to maximizing our clients’ return in a manner that is at once professional, efficient and compliant. We adhere to all major industry regulations, and we’ve also developed an extensive internal compliance management system. It’s one of the thing that has set BP Collect apart since we opened our doors in 1961.
Finding the Right Debt Collection Agency
If your company is dealing with unpaid invoices and customers who avoid your efforts at communicating, it might be time to consider a professional agency. Those unpaid invoices are likely costing you more than you think.