If you are a creditor and you are unable to recover loans from your borrowers then you should consider working with a debt collection service. However, you need to understand the different types of debt collection services available out there, with the main ones being services of a debt collection attorney and of a debt collection company. While they both may sound the same, there is a huge difference between the way they operate.
Understanding Debt Settlement
First and the foremost, it is imperative to understand how debt settlement works. Whether you hire an attorney or a company, they will work on your behalf to collect the debts from the borrowers by either cutting deals or filing suits in the court.
If you are thinking about filing for Chapter 7 bankruptcy, you need to understand the different criteria you will be judged on. In most cases, your bankruptcy lawyer will let you know immediately you whether or not you are eligible for bankruptcy. In general, your income needs to meet a certain threshold, you must not have filed for bankruptcy during a certain period, and you need to convince the court of your case.
Here are a few scenarios in which you won’t be able to file for Chapter 7 bankruptcy.
Your Income Meets Debt Payment Criteria
Unlike before, there is specific criteria on who can stay in Chapter 7 bankruptcy when it comes to debt repayment. Previously, it was up to the judge to decide whether you are eligible for Chapter 7 bankruptcy. For instance, if the judge believed you to have the income to fund a repayment plan through Chapter 13, then he or she had the power to force you to do so.
Chasing after your customers who haven’t paid you is stressful. Not only does it affect your cash flow, but it also wastes time that you should be spending on more important tasks. This is why hiring a collection attorney can be a wise option. You’ll find that with their help, the burden of following up over and over again will be lifted.
Ways to Collect Debt
Debt collection agencies can help get payment for credit card loans, late payments, and others. Collecting payment is a process, and there are various techniques on doing it. Most of the time, collection lawyers will call the customer. If it doesn’t work, a notification letter will be sent. If the customer is having a hard time paying the debt, a settlement may be discussed.
Being buried in debt can cause a lot of stress. What’s even worse is when you’re no longer capable of paying it. Don’t worry though because it’s not the end of the world. You can always look into filing a Chapter 7 bankruptcy. As long as you’re eligible, this can be your key to getting a fresh start.
How Does it Work?
When you’re approved for Chapter 7 bankruptcy, collection agencies will no longer be able to chase after you. It’s a way to discharge most of your debt, giving you a much-needed relief from creditors, some of whom might have been starting to harass you just to make you pay. In favorable cases, you will also be able to keep some of your possessions such as your home or car.
As a business owner, there are all sorts of aspects you have to manage on a daily basis. Among your most important roles lies in debt collection. Make sure debtors pay the full amount owed by taking these measures. This ensures the long-term health and success of your company. Continue reading How to Handle Difficult Debtors
For many people, dealing with financial issues can be hard. Instead of worrying and making your problems worse, you need to remain productive and do everything you can to get out of this financial rut. Continue reading Effectively Dealing with a Financial Crisis
If you are a creditor, you have likely dealt with a difficult debtor. Collecting money from them may be a rather complicated process. It doesn’t have to be a stressful scenario if you know what steps to take when these situations arise.
Continue reading How to Deal with Difficult Debtors