Business Debt/Debt collection

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Expert: - 7/14/2010


Question
Dear Michelle,

Is there a difference between Debt Collection and Judgment Recovery? If so, what is the difference?

When and who pays you? Typically, how long does recovery/ collection take?

Assuming you don't get paid until the debt is satisfied, what is the percentage of debts actually recovered and paid on?

It seems to me most people that don't pay a debt is because they don't have the assets to attach a lien too or the cash to pay the debt to begin with.

I have looked at Sierra, National Judgment Recovery Network. Are these thorough courses? Are there any others I should consider?  I will read your book too.

Thank you in advance for your time!

Sincerely,

Kathleen

Answer
Kathleen,

Yes, there is a difference between debt collection and judgment recovery.  I have never worked as a judgment recovery professional, but I have collected on judgments through my collection agency on judgments we obtained.  The difference is that a debt collector is a third party collector collecting debts for businesses that were not paid.  Judgment recovery professionals only collect judgments that others have obtained, this could be lawyers or individuals or businesses.

When you say "when and who pays you" I am assuming you mean as a third party collector?  
If so, you get payments from the debtor.  Recovery takes different amounts of time depending on the information you have and how you approach the situation.  If you have good contact information and the debt isn't disputed, and you follow procedures, you can set up a full payment or payment plan and depending on the age and size of the debt and the debtors ability to pay - that is how you can determine how long it will take to have the debt paid off.

YOu may want to join my Credit & Collections networking group (free - through yahoogroups) and ask your judgment recovery questions, there are people there that do this for a living and some of them use the Sierra National Recovery Network so they can tell you much more than I can.  I also have some resources here that might help you:  http://www.credit-and-collections.com/pages/startup_resources.php

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Michelle Dunn

Expertise

As one of the Top 5 Women in Collections, one of the Top 50 Collection Professionals, and winner of the Business Excellence award, I can answer any questions about debt, debt collection, improving business credit, creating a credit policy, enforcing a credit policy and collecting on past due accounts. I can also answer questions in regards to starting a debt collection agency since I have been a bill collector for over 24 years, started and ran my own collection agency for 8 years, and maintain my 12 year old Credit & Collections Association for members of the credit & debt collection industry. I am also the author of the popular and award winning book "Starting a Collection Agency, how to make money collecting money" now on it's 3rd edition. This book has won a the Writers Digest self published award as well as the New York Book Festival Award. I am a repeat contributor to the Wall Street Journal, and have been featured on NPR, CNN, as well as many other national radio and television programs. I have also been featured in national publications such as the Wall Street Journal, Forbes, Smart Money, MSNBC and much more. I have 17 published books to my name and am an accomplished speaker and consultant. I currently write 9 columns for newspapers, magazines and online portals worldwide.

Experience

I have over 24 years experience in debt collection, I started and ran my own collection agency for 8 years and I am the founder & owner of my Credit & Collections Association that I founded in 1998. www.credit-and-collections.com

Organizations
My Credit & Collections Association, I was also a member of the American Collectors Association and Plymouth Chamber of Commerce for 11 years. I am a member of many writing groups as well as my local Women Inspiring Women chapter. I am a member of Know More Media as an expert for their blog on business credit.

Publications
Business NH Magazine, Smart Money Magazine, MSNBC, CNN, Forbes.com, The Wall Street Journal, Home Business Magazine, Entrepreneur Magazine and website, many books, newspapers and television programs as well.

Education/Credentials
I have written 17 books in my collecting money series and one for Entrepreneur Press called the Ultimate Credit and Collections Handbook. My newest book is being published by John Wiley & Sons in May titled, The Guide to Getting Paid, how to weed out bad paying customers, collect on past due balances and avoid bad debt. This book is also being sold to many colleges as a text book.

Awards and Honors
My book Starting a Collection Agency, how to make money collecting money won an award from Writers Digest and the 2007 New York Book Festival in the "How to" category. I have won 2 awards from Dun & Bradstreet and Governor Jean Shaheen. I was nominated as one of the Top 5 Women in Collections twice as well as having been selected as one of Collection Advisor's Top 50 Collection Professionals by my peers.

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