When it comes to debt, sometimes the quickest and most effective way to get paid is to use a collection agency. Collection agencies can be an essential tool for businesses that are struggling to recover payments from delinquent debtors. However, before you decide to work with a collection agency, it’s important to understand what they charge and how that might impact your business.
Collection agencies typically charge a fee that is a percentage of the total amount owed by the debtor. This percentage can range from 10-50%, depending on the age and type of debt, as well as how difficult it might be to collect it. For instance, an agency may charge a higher percentage for more than 90 days past due debts. It’s also important to review the terms and conditions associated with any contract you sign with a collection agency to make sure you understand their fee structure and any other charges they might have.
In addition, be aware that agencies may also charge for additional services such as skip tracing or legal action.
Using a debt collection agency can be an effective way to collect past-due debts. However, it’s important to research the fees and processes associated with each agency and ensure you understand their fee structure before signing any contract. Collection Agency Cost.
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