Recover more debt

Did you know that 70% of Citibank bad debts are skipped accounts? And that 10% are bankruptcies and deceased accounts? That leaves only 20% of your bad debts that you are “actively” trying to collect or that you normally just write off or sell. What about the other 80%?

Of the $ 60 billion of debt that will be written off by general-purpose credit card issuers in the United States this year, only 90% is potentially collectible because 10% is tied to deceased, fraudulent, and bankrupt accounts. When this 90% of the debt is placed with collection agencies, it is found that half of the cardholders cannot be located even after the use of databases and online tracking tools.

Government regulations prohibit collection agencies from using any means other than the database to find debtors because they are not the owners of the debt. Therefore, if these accounts are placed with the agency on a contingent or other basis, they will need to ask the client who placed them to hire an “omission tracker”, a “private investigator” or a “omission tracking company” to locate those debtors. for them so they can then continue trying to collect. If you buy credit card debt and you own the debt, you can use the tools that a professional jump tracking company uses to locate those debtors and keep trying to collect. I have been told by professional jump trackers to check with the state you reside in. There are several states that do not require licenses or do not have state regulations. It is everywhere and varies from state to state.

45% of all canceled accounts are returned to issuers after collection agencies primary, secondary and tertiary collection efforts without any collection activity because debtors could not be found using traditional database or methods of collection omission tracking. Issuers have two options, sell the debt or hire a professional investigator to locate the debtors. The overwhelming practice has been to sell the debt. Card issuers rarely hire professional trackers because they consider them too expensive and feel like they are throwing away good money after bad. This could be because they can’t be bothered to keep spending time on accounts or they don’t realize that most placement companies offer a quote on all portfolios before processing and in some cases the cost may be add to debt. .

Fees range from $ 100 to $ 150 for small balance accounts with average fees from $ 350 to $ 450 for most wallets. These trackers often discover home and office addresses and phone numbers, allowing collectors to get in touch and attempt to collect your money. Most importantly, because so much time has passed since the original cancellation date, collectors can look not only for the original debt, but also for accrued interest, fees, and, in some states, the cost of tracking or tracing. of the debtor. The original amount of canceled debt doubles every 30 months with additional interest and fees.

Some professional investigators or jump tracking companies can locate between 70% and 80% of missing persons. I know of a localization company that guarantees they will locate 80%, so how can you lose? Other firms that specialize in localization work claim that the information discovered can be virtually unlimited depending on how much money the client wants to spend and the permitted purposes for which it is operating. Some examples they gave are assets, physical and postal addresses, vehicles, telephone numbers, and cell phones. Locator companies are not subject to government regulations that prevent the use of aggressive tracking techniques by any entity other than the owner of the debt. All private investigators are regulated by the state in which they operate. Their general rule of thumb is that you don’t do anything to locate a person that you wouldn’t do to locate your mother or your best friend. Private investigators have a fair amount of freedom as long as they don’t do anything illegal, immoral, or unethical. As an IP, it is illegal to impersonate a police officer, a court official, or any other government official. If the company you hire to do the work for your location is not involved in the debt collection aspect after the individual is located and has no knowledge of the details of the debt, it is not a “debt collector” as defines the FDCPA. This is an important distinction. The jump tracking company must not be owned or affiliated with a collection agency. Chris Soteros, the jump tracking manager for Merlin Information Services, states that they must comply with the FCRA and the Gramm Act, Leach Bliley, which restricts the use of Credit Bureau information to activities that support debt collection . He also stated that his company is not a third party debt collector and therefore is not regulated by the FDCPA.

Third-party debt collectors must follow the FDCPA when obtaining location information, this includes internal “hop trackers or locators,” even if they are not doing any collection work. This means that they can use databases and phone calls as long as they follow the FDCPA.

Most collection agencies and business owners are unaware that they can partner with a unique jump tracking firm to increase their bad debt recovery. Many collection agencies offer “default tracking” as an additional service to their clients. In most cases, due to the limited tools at their disposal, they do not locate 80% of the accounts they seek and therefore return them to the creditor as “uncollectible.” Business owners should be aware that when that happens, all hope is not lost. They should place that 80% of bad debt with a professional jump tracking company and send it to the agency for collection once they have good contact information for the debtors. Depending on the balance owed, this can add up to quite a bit of money at the end of the year. In my experience, collection agencies that also offer “jump tracking services” locate approximately 15% of the accounts they work on if they are performing collection work and limited location work. This is because most agencies train collectors to collect and not skip the trail, and also since they work for the agency they are subject to the same laws as the collector and therefore are limited in the use of certain location tools. Many people I interviewed for this article share the opinion that when working in a collection agency there is little time to skip tracking in most agencies, the main reason is that most agencies work on commission, where they are pays them for the money raised. . If they manage to locate a debtor, they still have to try to collect and that is not a guarantee. The general consensus is that it is not profitable for collectors or collection agencies to spend time and money skipping tracking when they could spend their time collecting, which is what they do best.

I interviewed many collection agencies that advertise “default tracking” as one of the services they offer and many of them stated that the way they “locate” debtors is through credit reports, asking other business owners. in your network about the debtor and the search engines. . Some of them told me that they offer address location, phone number rollback and retrieval, employment location, bank locations, vehicle locations, and much more, but couldn’t explain how they get this information. I even had a company that offers skip tracking and they said they couldn’t comment on the answer to any questions about their skip tracking techniques based on “your address and target audience.” When you’re researching a location or hop-tracking company, be sure to check references, verify their credentials, and speak to their clients. Some have websites with testimonials listed. Email those people, ask them how the service worked for them; Be smart with your money.

Business owners who use the services of collection agencies recognize that they need help with collections and therefore place or subcontract their bad debts to their collection agency. Once accounts that they cannot collect due to being unable to locate a debtor are returned by their agency, the smart business owner must acknowledge that they can place those accounts with a professional jump tracking company to locate and then return them to them. to your collection agency. to collect. In this way they help themselves and their collection agency and get back more of the money they are entitled to. Creditors who use a location or skip the tracking service are smart and will see that reflected in their results.

Collection agencies sometimes outsource different aspects of their collection work, such as generating and sending letters. Collection agencies do this because they recognize that they can charge more money if they outsource something they don’t specialize in, such as printing letters, filling envelopes and mail, and concentrating on what they do best, making collection calls, and collecting money for their clients. . . When they return accounts to their customers and ask them to provide current contact information so they can keep trying to collect it, they are making a smart business decision. They will make more money because once the client receives the accounts from your omission tracking company, the agency can work with the account, collect the money and make a commission, as well as send a check to their client. Everybody is happy.

Location companies, companies, and collection agencies complement each other by working together to ensure that as much debt as possible is collected, resulting in the success of all parties. After looking at these facts, take a good look at your business and your bad debts and ask yourself, “Can I afford not to use all the resources that are available to recover the money owed to me?” If you are in business to make money, using a locator company, like using a collection agency, is a must.

The market for debt buyers and collection agencies has become increasingly competitive with higher prices, higher risks and tougher performance demands, according to the November issue of Cards and Payments. In light of this, you want to work together with your collectors and skip markers. When you can help make a collector’s job easier by using a jump tracking company, everyone will benefit.