Contingency Collections and How it Works
Sometimes we forget not everyone understands industry jargon. No collection no fee is the concept behind contingency collections and it’s the collection model most people are familiar with. Here’s how it works. You give me your collection account and if I can collect it I keep a percentage of what I collect, generally 20% to 50%, if I can’t collect, I don’t get paid.
In a quick review of about 12 contingency collection agency websites we found “no collection no fee” to be 1 of only 3 benefits agencies tout when promoting their companies. The others are the percentage they charge and their success rate. You can read what I have to say about success rates here.
Sounds Good To Me
You might believe this is a highly motivating strategy. You might even believe that without that motivation collectors won’t work your accounts, and in many cases, you’d be right! Here’s the problem; collectors get paid when they collect! No collection, no fee, no fee, no commission. So, if it isn’t fast and easy they won’t work on it. It’s called cherry picking, and they can’t help but do it, their livelihood depends on a successful collection. If they do work your account even good collectors are frequently overly aggressive and often times rude, again because their paycheck depends on successful collections.
Now, you may be thinking “that’s just what I’m looking for.” Unfortunately, most legitimate agencies have strict policies regarding the size and type of account they’ll accept. Small accounts and consumer accounts can be hard to place. All agencies are not created equally. If the rate is too low or the promises are too good to be true, be careful.
A Better Idea?
We think we’ve got a better idea. Flat fee collections, one low fee paid in front. You save money and you don’t risk overly aggressive collectors damaging your reputation in the marketplace. You can read about it here.
Give us a try! Call me at 800-201-CA$H (2274) my extension is 110 and request a 2-4-1 Gift Certificate – you can use it and reuse it until the expiration date for up to 100 accounts. All you have to do is ask.