Collection Agencies

[DaycareMomma]

Are there any certain collection agencies that you recommend to collect a payment debt?

Any advice for sending an account to collections?

[EntropyControlSpecialist]

I'm in the same situation. I'll be watching this thread!

[Michael]

Don't know if there is any information in these earlier threads: https://www.daycare.com/forum/tags.p...lection+agency

[Meeko]

I use Advanced Credit Management right here in Orem, Utah, although they help people nationwide.

http://www.advancedcreditmanagement.mobi/

Doesn't cost me one single dime. At least it didn't the last time I used them which was a few years ago. I am going to assume they still offer that service, but feel free to call them! The people in their office are very friendly and accommodating.

I turn over the paperwork/amounts etc to them. It is then out of my hands. By law, the parents cannot pay me. If I accept payment from the parent, I am then liable to pay the collection company their 40% too. So I wash my hands of it and refuse to even talk to the offending parents.

They immediately add 40% to the amount owed by the parent and go after them. They continue to add their attorney fees/court costs etc to the bill as they go. When the parent coughs up, I get what is owed to me and they also have to pay an extra 40% to the collection firm. If a judgement is made in court and the parent has to pay a monthly amount until paid off, I get 60% of the payment and ACM get 40% until I have been paid in full.

I love this way because once I turn over an account, it's out of my hands. No dealing with difficult parents, no time off to go to court etc. The collections company go after the parent aggressively...no backbone needed by me!!! I just sit back and get paid.

I have it in my contract that I use this firm, that it doesn't cost me one red cent, and that they add 40% to the bill if I turn it over to them. I have it written that it is too late to make payment to me once I have turned over an account. This is usually enough to make parents pay up. They don't want to end up owing even more AND have a ding on their credit for having been turned over to a collections agency.

I would not like the confrontation of small claims court (been there/done that when selling a car to a neighbor. We won, but it was a nasty experience) and I don't want to have to close my day care down for the day to go to court either.

Happy to let someone else do the chasing and "messy" part!

[DaycareMomma]

Thanks Meeko for the information. My only question, is in my contract I don't have anything about what steps I'd take if non payment happened. So could I still use a company like that that will add 40% to their bill? Or do they have to be previously made aware of it?

[Kiki]

Thanks Meeko for the information. My only question, is in my contract I don't have anything about what steps I'd take if non payment happened. So could I still use a company like that that will add 40% to their bill? Or do they have to be previously made aware of it?

Do you have anything at all? Even just a generic 'All accounts 30 days or more past due will be turned over to collections.'? If so, I'm fairly certain you'd still be able to use this company, all collection agencies tack on a fee to the amount they are collecting, that's how they make money.

[DaycareMomma]

Regretfully I don't have anything in my contract concerning late payments and collection agencies. This is all it says regarding late payments:

"I am to be paid at the end of every week. If not paid by closing on the last day of care for the week, a late fee of $20.00 will be added on. If not paid by the next working day morning, a $5.00/day charge will be added on and I will not watch your child until you have paid me."

[EntropyControlSpecialist]

Regretfully I don't have anything in my contract concerning late payments and collection agencies. This is all it says regarding late payments:

"I am to be paid at the end of every week. If not paid by closing on the last day of care for the week, a late fee of $20.00 will be added on. If not paid by the next working day morning, a $5.00/day charge will be added on and I will not watch your child until you have paid me."

I'm also in a somewhat similar position. I do not have anything in my handbook detailing what happens to unpaid accounts. I am adding it today.

I don't see why we couldn't send a certified letter detailing what is owed, when it is due, and what will happen if they fail to pay (it gets turned over to a collections agency)? We would know they received it, because they would have to sign for it.

[DaycareMomma]

Thats actually just what I did, here is my exact letter to them:

As of today's date (June 26th, 2012) you owe me, ******* *****, $800.00.This amount is for the timeframes of May 14th, 2012 to May 31st, 2012 for care given to your children ***** and *****. This amount is past due and as a result you will incur an automatic fee of $20.00 for nonpayment along with $5.00 per day until your account is paid in full.

I am willing to waive the late fees if payment is received by June 29th, 2012 by 5:30 PM.

If you fail to pay by June 29th, 2012 at 5:30 PM I will send your account to a collection agency to recover the proper fee’s due to me. In addition, if not paid by above said date, you will be responsible for all late fees’ which will equal $165 as of June 29th, 2012 at 5:30 PM. You will also be responsible for any fee’s I incur while attempting to collect your debt owed to me.

Enclosed you will find the signature page of my contract showing that you signed it and agreed to all my terms and policies.

Thank you for your prompt attention to this matter.

[missjenny]

Do you have anything at all? Even just a generic 'All accounts 30 days or more past due will be turned over to collections.'? If so, I'm fairly certain you'd still be able to use this company, all collection agencies tack on a fee to the amount they are collecting, that's how they make money.

I will add something like this to mine.

[Blackcat31]

Why send the bill to collection? Why not just take them to small claims court?

I included in my contract that I would hire a substitute if I had to go court to pursue money owed and the family would be required to pay for the cost of the substitute.

My contract says:

In the event that any payment is not made; parents will be responsible for the following fees: ANY and ALL costs associated with the non-payment, including but not limited to, accumulated late fees, return check fees ($30.00), insufficient funds fees, collection fees, court costs, and substitute fees. Collection of any payments not made will begin 10 calendar days after the original due date.

[DaycareMomma]

The reason I'm looking at collections over small claims court is I feel that it will hurt them more. They have made it well known that they are trying to do everything possible to clean up their credit to buy a house and by sending to collections, it will go on their credit report and be very hard to get any loans with it on there without taking care of it.

[MyAngels]

I know in my state it's very difficult to collect attorneys fees, court costs or collection fees on a contract if you don't specifically spell it out in the contract - i.e., "If any fees are unpaid at the termination of this contract you will be responsible for those fees, plus the costs of collection, including, but not limited to, attorneys fees, court costs and collection agency fees."

I'm sure each state is different, but it couldn't hurt to check with an attorney to be sure you're covered in the event of a default.

[Country Kids]

I think even if you take them to small claims court it will show up on their credit report. It would come under a garnishment I believe.

Going to court though takes alot of time. I tried small claims once and it was a pain because I only received a little bit of my money because my time or something ran out for it. I was put on a list of receivers that she owed money from. Well I started to receive money but they needed me to reapply or something and I just didn't have the time to do all that so I just lost out.

If I have to do it ever again I might just go through a credit agency.

[DaycareMomma]

I'm new to all of this so we'll see what happens. I figure, even if they don't pay but its on their credit report and it isn't really that small of an amount either, its $980 they owe me as of today, to see that as a loan officer, you'd think it would turn them off that they cannot even pay the person that cares for their children.