A business in the black can quickly land in the red zone if customers aren’t paying their bills. Those delinquent accounts are money owed the business, but that cash is not coming in, which negatively impacts company coffers. Faced with the challenges of getting what’s owed, a business may need to consider different and more aggressive collection methods.
Professional Debt Collection
Sending customers a second or third bill sometimes gets them to pay. Phone calls may also work, but many times there is little a business can do to make a delinquent account holder fork over the cash they owe. The longer the account goes unresolved, the less likely it is to ever be resolved. Fortunately, companies don’t have to use their time and manpower on these hard-to-recover accounts when professionals are ready and better able to get the job done.
Who Helps Collect Outstanding Debt?
Two options exist when hiring outside help to resolve delinquent accounts: debt collection agencies and debt collection attorneys. Agencies and attorneys both work hard to recover money, but attorneys have more legal options, which Texas industries may need. Consumers in the state have some of the lowest credit scores in the nation, which means there are likely a very high number of businesses waiting to be paid.
Why Choose a Texas Business Debt Collection Attorney
While a collection agency and collection attorney may initially approach a debt the same way by calling or sending a letter to the debtor, the lawyer’s correspondence has more influence and carries more weight. What debtor wants to hear from an attorney about old debts? None, especially if it’s a case that could end up in court. Since it is harder to ignore a phone call or letter from a lawyer about a legal matter, businesses hiring a Texas business debt collection attorney can expect to see some of their delinquent accounts paid back voluntarily.
Some people won’t pay their debts unless forced to do so, which is why a Texas business debt collection attorney is often a better option. If the offending business debtor won’t pay, legal action may be necessary. A collection agency needs to consult a business owner about this option first, and then find an attorney to take action.
With a collection agency, their fees plus the attorney’s rates are required. Retaining a debt collection attorney firm means legal counsel is already on the case and can start legal recourse immediately. Plus, the only fees to pay are to the attorney for minimal filing costs.
Another issue to consider is direct versus indirect contact. Hiring a collection agency means that if legal action is required, the business must go through that agency to discuss legal matters. Go with a debt collection law firm from the start, and the business always has direct access to their legal counsel.
The Best Outcome
Getting paid is the bottom line with debt collection. A company securing professional help wants the best results, and that often requires the law. Collection agencies can get judgments against debtors but have few, if any, methods to actually force payment of the debt. On the other hand, debt collection law firms have several tools to collect legal judgments, such as wage garnishment, bank levies, and property foreclosures.
Not every delinquent account requires legal action, such as those with small balances, but those with higher balances need collecting. While one or two past due bills may have little impact on a company’s bottom line, the more accounts allowed to remain idle, the more likely a company could face financial distress. Instead of allowing the problem to grow out of control, taking proactive steps, such as hiring a business debt collection attorney, can keep the books in the black.