If you’re a creditor, chances are you’ve had to deal with delinquent accounts at some point. Dealing with one delinquent account can be challenging enough, but when you have multiple delinquent accounts, it can feel like an insurmountable task. However, there are some things you can do to manage multiple delinquent accounts effectively. Here are six tips:
1. Keep Detailed Records
When you’re dealing with multiple delinquent accounts, it’s important to keep detailed records. This includes keeping track of who owes what when the debt was incurred, and any correspondence you’ve had with the debtor.
Correspondences should include letters, emails, text messages, social media interactions, and any other documentable touch-point that you’ve had. This will not only help you keep everything straight, but it will also come in handy if you need to take legal action against the debtor.
2. Prioritize Your Accounts
With multiple delinquent accounts, you’ll likely have limited resources to dedicate to collections. As such, it’s important to prioritize your accounts. Start by identifying which accounts are the most delinquent and focus your efforts on those first.
Once you’ve made significant progress on those accounts, you can move down your list and start working on the next most delinquent account. Point of clarity: by “most delinquent,” we’re talking more about the largest outstanding debts more than the time elapsed, though both are quite important.
3. Negotiate Payment Plans
One way to effectively manage multiple delinquent accounts is to negotiate payment plans with debtors. This will not only help the debtor stay current on their debt, but it will also give them a sense of relief knowing that they have a plan in place to pay off what they owe.
Be sure to document any payment plans agreed upon so there is no confusion down the road. This will help create a paper trail that will help any future legal action. It will also enable you to keep up with what’s coming due to avoid any cash flow issues.
4. Consider Hiring a Debt Collection Service
If you’re struggling to manage multiple delinquent accounts on your own, consider hiring a debt collection service. A good debt collection service will have experience dealing with delinquencies and will be able to quickly and efficiently collect outstanding debts.
In some cases, they may even be able to negotiate better payment terms than you could on your own. Doing this enables you to take advantage of the collection services resources while freeing up your creative energy to work on the business.
5. Be Firm but Fair
When dealing with delinquent accounts, it’s important to be firm but fair. This means being firm in your demand for payment while understanding the debtor’s situation. Remember, the goal is to get the debt paid off—not to make the debtor’s life more difficult than it needs to be.
Too many business owners can take the inability to pay (or pay on time) personally. It’s understandable. You’ve got a family to raise, too. But you don’t get very far drawing lines in the sand.
Showing that you’re empathetic to a debtor’s position can help you more effectively communicate with them. And with better communication comes better revenue optimization.
6. Stay Up-to-Date on Changes in the Law
The laws surrounding debt collections are always changing, so it’s important to stay up-to-date on any changes that may affect your business. This includes changes at the state and federal level as well as any industry-specific changes that may come about.
By staying up-to-date on changes in the law, you can ensure that your business is always in compliance—and that you’re always using the most effective methods for collecting outstanding debts.
Delinquent Accounts Need Not Keep You Up at Night
Dealing with one delinquent account can be challenging enough—but when you have multiple delinquent accounts, it can feel like an insurmountable task!
However, by following these six tips—keeping detailed records; prioritizing your accounts; negotiating payment plans; considering hiring a debt collection service; being firm but fair; staying up-to-date on changes in the law—you can effectively manage multiple accounts without pulling all of your hair out in the process!
Southwest Recovery Services can get you there. If you’re feeling overwhelmed, why not reach out to the best in the business at getting you paid quickly? Contact us today to learn more about the ways that we can help!