Debt Collection - A Waste of Time?

[Jet Virtual]

So basically I have had clients who have not paid us and been through 3 debt collection agencies and still no results.

I am even now trying to find a debt collection agency to chase another debt collection agency who owes us money!!!

I was told that even when you take someone to small claims court you still are not guaranteed to get your money!

Any hope out there?

 

[simon field]

Debt collectors have no powers whatsoever.

The seasoned debtor can tie you up for months and £££'s due to the sluggish and expensive nature of our legal system.

It pretty much comes down to how much you're owed and the financial state of whoever owes you money as to whether its worth your time perusing it.

IMHO.

Edit: and never pay upfront fees to debt collectors.

 

[Talay]

Theoretical small claims process is claim, judgement, non payment, obtain CCJ, non payment, bailiffs / sheriffs, charge on property (if in their name), wait years, maybe get paid when they sell the house.

If they don't value their credit record, you are likely stuffed, as no judge is going to enforce an order for sale of their house if there are kids or any one of a thousand other reasons.

Don't advance more than you can afford to lose as a cost of doing business and certainly not without some form of credit check.

 

[GRDCredit]

So basically I have had clients who have not paid us and been through 3 debt collection agencies and still no results.

OK - I may be biased!

To be clear, you have instructed 3 different debt collectors to collect the same debt? What I say to my clients is that there comes a point where you have to stop barking and start biting.

Debt collector number 1 will have written/phoned to collect debt, probably threatening legal action etc

Presumably that was unsuccessful so you instructed Number 2 to do the same thing, and then again Number 3

What message is that giving to your customer? If you are wanting to collect the debt there comes a point where you have to go down the legal route, MCOL

I am even now trying to find a debt collection agency to chase another debt collection agency who owes us money!!!
?

Oh dear. Why does a debt collection company owe you money?

I was told that even when you take someone to small claims court you still are not guaranteed to get your money!

Of course not. If they haven't got it, you can't have it! A good debt collector will however advise you - by doing credit checks and from experience - which cases are worth pursuing to small claims

Edit: and never pay upfront fees to debt collectors.

Agree totally with this. In fact, you should never, imo, pay any fee to the debt collector - he should be collecting his fee from the other side. The only cost to you should be any out of pocket expenses such as claim fee

If they don't value their credit record, you are likely stuffed,
.

Sort of agree with this although most businesses do value their credit record and I assume you are talking B2B debts?

Any hope out there?

Modesty does not permit me to answer this but you could try @GeoffT

 

[maxine]

What have the DCA's said as the reason for no results?

Usually it might be disputes, or the debtors isn't who they say they are, or the contracts are not valid, or anything else that would prevent the usual litigation process from being successful where they would get their fees.

?

 

[Big G]

I agree with GRD Credit - If you are simply moving from debt collector to debt collector then you debtors know your not going to issue legal proceedings as stated within there letters so they will simply ignore.

Are the monies due from private individuals or a businesses?

 

[Geoff T]

Some good points here - both from Maxine and the "ever modest" GRD!

Two root-cause issues IMO here OP...

1. Trying different DCA's without ever meaning to follow through says MORE about your business than their collection options, cos you'll "shout about it" but do nothing... so a toothless tiger... (but I still agree with GRD about up front payments!)... so don't knock on MY door asking for "pro bono" work (which is what you're doing)... I've got bills to pay too!

2. Do you REALLY want your business reputation for getting paid to read "we'll shout - but do nowt"? - if it does... expect everyone to get - and give - everyone "mates rates" (with a guaranteed write off option)!

 

[Geoff T]

Debt collectors have no powers whatsoever.

The seasoned debtor can tie you up for months and £££'s due to the sluggish and expensive nature of our legal system.

It pretty much comes down to how much you're owed and the financial state of whoever owes you money as to whether its worth your time perusing it.

IMHO.

Edit: and never pay upfront fees to debt collectors.

"powers" - no, not with the currently screwed up legal system that doesn't allow for the majority of businesses in the UK (referred to as "SME") some cost-effective, decent help...

"intervention options" - hell yes - and none of us collectors are responsible for the law... we just have to try helping our clients within the constraints of the law...

Until the law stops the bias towards the defendant rather than giving the claimant a fair hearing - then people like me, and anyone owed money, are always going to fighting against the tide...

 

[simon field]

Agreed Geoff - have just witnessed it first hand (the legal 'system' that is)

Have a good weekend sir!

 

[Geoff T]

got a dose 2 weeks ago myself - client won, i didn't!..

have a good 'un yourself sir

 

[Geoff T]

Agreed Geoff - have just witnessed it first hand (the legal 'system' that is)

Have a good weekend sir!

do I dare start a debate about the Late Regs 2013 IRO reasonable 3rd party costs at this point?

 

[Jet Virtual]

Ok so basically the reason the 3rd debt collection agency owes us money is because we paid them to CCJ fees to start proceedings. This was over 5 months ago!

I have tried to contact the debt collection agency but have not managed to get through.

 

[simon field]

we paid them to CCJ fees to start proceedings..

What does that mean? It doesn't make sense.

 

[Jet Virtual]

Ok basically we decided to start small claims court proceedings against 5 companies that owed us money. The debt collector told us to pay them £250 so they can pay the court fees.

 

[simon field]

Ah right, so the DC's are preparing your 5 cases for you, and submitting 5 lots of fees to the court for 5 different cases?

Edit: Or rather, would have been?

 

[Jet Virtual]

Yes but this was over 5 months ago so i guess i can kiss that money goodbye

 

[simon field]

Yes. Unless you're friends with 'Gino and the Boys'

 

[Jet Virtual]

Well I used to work with 2 guys who were WWF Wrestlers ...

 

[Big G]

If you paid them £250 to issue 5 small claims against 5 companies then once the debtor has been served with the papers you would receive notice from the court 'notice of service' that they have been served and a deadline they have to respond by, unless they had a solicitor issue the claim in which case they would receive the notice however, i doubt a solicitor issued the claims as the costs to issue would be a lot higher than £250.00.

As you have been with a couple of companies did you do your research before appointing them, a simple google search usually brings up any issues with the company.