# Anyone used a debt collection agency?



## terzdesign (Mar 8, 2010)

I've got a couple of deadbeat clients who just wont pay up. One is a nice fellow who is taking advantage of my amicability, the other is simply not willing to pay. I contacted a debt collector to see what the terms were. 33% of the take goes to them if they collect. I pay nothing if no debt is collected. Sounds pretty straight forward. Thoughts?


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## Ripcord (Sep 2, 2006)

I just collected on an invoice using a debt collector. It took them three months to get the customer to pay but finally they sent me a check for the original amount plus the 33% for the collection fee. I still have no idea why the customer wouldn't pay in the first place, since they issued a purchase order before I printed. I'll probably never know...


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## terzdesign (Mar 8, 2010)

Ripcord said:


> I just collected on an invoice using a debt collector. It took them three months to get the customer to pay but finally they sent me a check for the original amount plus the 33% for the collection fee. I still have no idea why the customer wouldn't pay, since they issued a purchase order before I printed. I'll probably never know...


Yes, purchase orders. How do you not pay on those? These are businesses too... albeit small businesses.


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## djque (Feb 5, 2013)

I have a 75% deposit before I do any work and the rest is due when I finish the order and the product is not released till balance is due. just like How I do my DJ Business.except deposit to secure the date and me show up and after im set up balance is due within the hr after music starts or i turnoff music and wait or pack up.


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## Ripcord (Sep 2, 2006)

terzdesign said:


> Yes, purchase orders. How do you not pay on those? These are businesses too... albeit small businesses.


This is a large business that I used to work for and I've been printing their T-shirts for over ten years. The order was placed a few weeks after the company was purchased by a major daily newspaper that has been publishing for almost 150 years. The PO was issued by the new company and my invoice was ignored. Moreover, the accounting manager doesn't answer her phone or return voicemails or emails (at least not mine.)

I'm still shaking my head, since this is what I used to believe was a reputable publisher that is respected in their community. I have yet to receive any explanation.


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## berkeley (Jun 14, 2014)

depending on amount you can always take them to small claims court - they let you add on interest after a certain time so you could end up with more than the original debt for your trouble, instead of paying those horrible & sometimes unethical collection companies...


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## bpfohler (Jun 7, 2009)

Send a demand letter certified mail, if it's returned or signed for without receiving payment in 30 days spend $25 at your local County Clerk and file a small claim for the bill and your cost for taking the day off to deal with the BS.
When they don't show up for the court date ( they never do) the judgment will be in your favor. If they don't pay you, you are now armed with a court judgment in your favor that allows you to place a lien on any item they own that requires a title.
Imagine their suprise when they try to trade in their BMW and they can't because we have a lien on the title. Been there, it works.


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## jleampark (Sep 6, 2007)

bpfohler said:


> Send a demand letter certified mail, if it's returned or signed for without receiving payment in 30 days spend $25 at your local County Clerk and file a small claim for the bill and your cost for taking the day off to deal with the BS.
> When they don't show up for the court date ( they never do) the judgment will be in your favor. If they don't pay you, you are now armed with a court judgment in your favor that allows you to place a lien on any item they own that requires a title.
> Imagine their suprise when they try to trade in their BMW and they can't because we have a lien on the title. Been there, it works.


 DAYumm... I like the way you play.

Does it matter if the customer is in another state? I had one guy that took forever to pay.


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## Ripcord (Sep 2, 2006)

jleampark said:


> Does it matter if the customer is in another state? I had one guy that took forever to pay.


I think if they're in another state you need to file in small claims court in that state, which will be inconvenient for you. The customer that didn't pay me is in Mississippi. I called Empire Collection and was 100% pleased with the way they handled it. The customer paid the entire invoice and also the collection fee. The whole thing only cost me about twenty bucks. I will definitely use them again if I need to.


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## Maxcat (Nov 23, 2014)

Read any fine print with debt collectors. I hired one about 15 years ago and I ended up owing them money. 

They collected less than what their minimum fee was on an invoice and said we owed them the difference on their fee since they were able to collect something. (kinda funny but still makes me mad)

Also check to see if you give up all rights to contact the debtor. After getting hosed on the first one they "collected" we wanted to contact the people who owed us to verify what, if anything, they collected. We didn't contact any others that owed us. Can't remember if it was because of the collection or law but for whatever reason we were afraid to follow up to see if anyone paid and the collection agent just kept the money.

We actually thought we did a good job selecting our collection agency, but not such a good choice. I'd have to be owed bunch before going down that road again.


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## Ripcord (Sep 2, 2006)

The one I used charges a straight 33% of what they are able to collect for you. In my case the customer paid the 33% but then I had to pay the collection agency 33% of that 33%, so it cost me a little money but I still got almost the entire amount I was originally owed.


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## Hotpuppy (Sep 21, 2016)

This is always a sticky situation. From the sound of it they are just short on money.

I used a few tactics to encourage payment.

First we faxed and emailed and mailed a new invoice at 30 days. Then again at 45 days and 60 days.

We would hold any new work at 60 days.

After 60 days I had a firm in Dallas we turned it over to. I would always call them first and tell them that I did not want to turn it over for collections and ask where we were at on payment. I could often get it paid by credit card at this point. I didn't care because losing 3% beat losing 30% for credit.

big companies are the worst. We used to jokingly refer to it as Net 30/120 meaning we extend 30 and they take 120 to pay. It was part of doing business with them and you eventually got paid. 

My advice: Don't lend anything you can't afford to lose.

We also did a fair amount of contract work and I would report them as late with ASI and SAGE which dinged their wholesale credit and warned others they didn't pay or didn't pay on time. I wouldn't extend credit without pulling a D&B for commercial customers or a ASI report for wholesale customers.


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