Becoming a Partner for Successful Debt Collection Strategies

by Chris
(Iowa City, Iowa, USA)

You have read many times that debtors want to pay their debts, but for a myriad of reasons are unwilling or unable to. In the past our industry has relied on fear and other techniques to collect debt.

Now we are seeing a new tact in the industry that seems to be gaining ground and getting results. This is the debt counselor or debt facilitator role that many collectors are now adopting. With the economy in shambles more and more people who have never experienced debt are now coming into contact with the debt collection industry.

We can help them understand and fulfill their obligations by becoming partners with them in fulfilling their debt obligations. Here are some simple steps in becoming a partner in successful debt collection:

1. Allow the debtor to explain his or her situation. Many times people just have the need to be heard. Listen to them and empathize with them.
   
   
2. Once the debtor has vented explain to them that you are there to help them and work out their difficulties.
   
   
3. Work with the debtor to set up a regular payment plan. Make sure the payments are a small amount that the debtor won’t take issue with. ($10.00 a week is $540.00 a year which is better than nothing).
   
   
4. Maintain communication with the debtor. Call or email the debtor just to check in and see how they are doing. This is particularly effective on or near their birthdates when they may have received additional funds from family members. Perhaps they would want to make a onetime principal payment?
   
   
5. Reward the debtor frequently. Set milestones and reward the debtor with emails or calls when the milestones have been met. E.g. “Hey, I just called to let you know that you know that you have paid $500.00 toward your debt. Isn’t that great?”
   
   
6. When contacting the debtor ask them to make a quick payment of a small amount over the phone of a very small amount of 5-20 dollars. Even if you only contact the debtor once every 2 months and get an additional 10 dollar payment from him/her that is an additional 60 dollars that you have gained in addition to their regular payments.
   While this tact may not work for all debtors, it has been successful with many. If all else has failed, it may be worth a look.