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Types of collection agencies
A small part of the collection agencies are departments of law firms that specialize in the recover of debts. Some of them work as quickly , efficiently and cost-effectively as the large collection companies , but have this part better recovery rates . This is probably mainly due to the latent psychological "threat potential " by attorney letterhead , which look much more intimidating and without taking special care to imply a recovery with legal assistance .
A special collection is the insolvency debt collection , a special collection for insolvency , with the aim to significantly increase the recovery rate and thus on the survival of fallen into insolvency farms and conservation to increase the chances of their jobs.
In the past, large creditors (especially banks) have started to outsource the collection to collection agencies . One of the reasons was that the external costs of collection agencies are can roll to the debtor , the cost of internal processing of claims is not. Partial subsidiaries were established to perform this collection .
Types of debt collection business
The creditor mandated the collection agency to collect its receivables from the debtor . The collection agency then acts under a power of attorney of the creditor. The risk , the demand not being able to realize remains with the creditor.
The creditor sold its demand (usually at a deep discount ) to the collection agency . The collection agency is a result of an assignment statement of the client. The risk , the demand not being able to realize , takes over the collection agency .
What is collection?
receivables, for example eriner or more open invoices. The collection is a portion of the accounts receivable management. For this purpose also includes the accounts receivable and the legal dunning. Many companies give the collection out of hand. Law firms or specialized debt collection firms are contracted for this purpose. In short, a debt collection company, also called debt collection agency is a service provider that helps to creditors to collect money owed.
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Debt collection redirects here. See the "See also" section and the navigation box at the end for more aspects of debt collection.
A collection agency is a business that pursues payments of debts owed by individuals or businesses. Most collection agencies operate as agents of creditors and collect debts for a fee or percentage of the total amount owed.
There are many types of collection agencies. First-party agencies are often subsidiaries of the original company the debt is owed to. Third-party agencies are separate companies contracted by a company to collect debts on their behalf for a fee. Debt buyers purchase the debt at a percentage of its value, then attempt to collect it. Each country has its own rules and regulations regarding them.
source: http://en.wikipedia.org/wiki/Collection_agency
