Money mismanagement and overspending are common ways that many people get into debt. According to recent media news, Consumers in the UK collectively owe in excess of £1 trillion. This is surely not a small amount. Much of this debt is due to borrowing on credit cards, bank loans and mortgages. As consumer borrowing increases, so does the amount of people encountering financial difficulty in paying back what they owe. As a result, more and more financial agreements are becoming delinquent and are subsequently passed from the original lender to a debt collection service. Debt Collection services are businesses that collect past-due bills and accounts receivable for other persons or businesses in exchange for a fee.
In order to collect due debts most collection services will use one of three tactics: letters, telephone calls, litigation. They will usually begin the collection process by sending a series of ‘demand’ letters, often allowing the debtor to enter into negotiations to repay the debt. The final notification letter that is sent out generally warns the debtor that if no contact is made prior to a certain date then the debtor’s name will be passed onto a more intensive method of debt collection. Some collection services might also phone the debtor directly, again allowing the debtor to work with the agency to agree a plan to repay the debt. This method can sometimes have the best results in collecting a delinquent debt. The third method, litigation, is a last resort and is generally only used when all other attempts to reclaim the debt have failed. This involves taking the debtor to a small-claims court and could eventually result in the debtor being made bankrupt, depending on the amount of debt owed.
If you are a lender, you know exactly how collecting debts can be a consuming and expensive process in terms of time and finance. STA Graydon will make it easy for you. They’ve got the experience and techniques in place to carry out your DEBT COLLECTION leaving you to focus on other areas of your business.