3 Common Debt Collection Myths, Busted

Your business is struggling. You need help. But debt collection agencies don’t have a great reputation. You’ve probably heard more bad things about them than you can shake a stick at.  

Making the decision to hire a debt collection agency can be a difficult one. 

The negativity associated with debt collection agencies can leave you wondering if it’s worth it to take one on. Yet the stress of watching your business suffer financially is taking a toll on your morale.  

Cedar Financial wants to ease your mind about debt collection agencies by debunking some of the common misconceptions. We will get you one step closer to getting your business back to financial success.  

Myth #1: Debt collectors don’t care about your customers

This is probably one of the most common myths when it comes to debt collection.

Debt collection agencies have a reputation for being aggressive and harsh to those in debt. And maybe at one time they were. However, so much has changed and today, it’s simply not the case (most of the time).

Here are the real facts:

• Debt collectors are people too

Contrary to popular belief, debt collectors are real people with real feelings, just like your customers. We’re not monsters void of emotion. Our goal is to help, not hurt, your customers.

• We’re not just collectors – we’re expert communicators

Many people think collectors are just out to make money. But a lot more goes into it than that. Having debt is stressful, which means collectors constantly have to deal with difficult customers. A good collector knows that empathy is a much more effective way to de-escalate a situation than aggression.

 So, really, most debt collectors are just like you and me. When you’re the one in debt, it’s easy to act on emotion and immediately form a negative opinion. But, when given the chance, good collectors will prove they’re real people who care.

Myth #2 – Hiring a debt collection agency is way too expensive

Yes, hiring a debt collection agency is an expense you will have to add to your budget. But in the long run, it’s a lot more expensive to let your payments slip away. Here’s why debt collection services are actually much cheaper than you think:

• “No Win, No Fee” 

Any reputable agency will only charge you if they recover your funds – that means you don’t pay unless they succeed. You make money – they make money – it’s a win-win.

• Affordable rates for your file type

There’s no one-size-fits-all cost. Agencies charge different rates based on the type of file you need to collect. For example, they might charge more for older files because they are more difficult to collect. Factors that affect rates include: industry, amount due, age, and more. So be sure to collect some quotes to find the best rates for you.

• Recovering something is 100% better than nothing

If you still have sticker shock, think about it this way: how much money are you LOSING if you don’t collect? It’s much better to collect 60-75% of your debts than nothing.

It’s easy to focus on the expense, but it’s even more costly to ignore your accounts altogether. Plus, you’re saving yourself time and resources. So next time your boss complains about the collection fees, remind them how much would’ve been lost without it.

Myth #3 – If you hire a debt collection agency, you’ll lose customers

This is another myth that stems from the olden days of unregulated, aggressive collectors. If not handled correctly, collections certainly can drive your customers in the opposite direction – with complaints, negative reviews, and poor reputation as the consequence.

However, the collections industry has changed – a lot.

A licensed, reputable agency will never use aggressive, unfair or deceptive practices in the collection of your funds. In fact, they have to jump through many compliance hoops to just to stay in business and not get sued.

Customers these days expect great service – but not all creditors have the resources to provide it. A courteous collection agency fills this communication gap,  working with customers to help them find amicable ways to resolve the problem.

A good agency can actually help your company grow by:

• Providing excellent customer service
• Repairing damaged customer relationships
• Increasing customer retention

Not only will you get the money you’re owed, but you can repair relationships so that your customers remain your customers.

 Collect the Right Way with Cedar Financial

Hiring a collection agency doesn’t have to be scary. Cedar Financial is changing the way debt collection is handled-in a good way. Here’s how:

• People-First Approach

We use a People-First Approach, which means your customers will always be treated with the utmost respect. Our agents understand that things happen and sometimes people fall behind. Our goal is to help them with courtesy, which helps your business grow.

• “No Win, No Fee” Competitive Rates

At Cedar Financial, we don’t win unless you do. We wouldn’t be much help if we ended up costing you more money in the long run. Our aim is to help you – and your customers – succeed, with affordable solutions.

• Focus on Customer Relationships

We know how important your customers are to you. We help you repair your relationship so you can retain more business and reach your goals faster.

Cedar Financial will take the pressure off you. You have plenty of irons in the fire to focus on. Don’t let untruths about the debt collection industry keep you from recovering payments and making you more successful. 

*The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Information on this website may not constitute the most up-to-date legal or other information.