5 myths about debt collection agencies
The debt collection industry is one of the oldest industries in history. As long as there has been trade between two parties, there has been a need to collect debts.
Perhaps that is why the debt collection sector is also one of the sectors with the most myths.
There are a lot of myths about debt collection and especially about debt collection agencies - and as a debt collection agency with over 150 years of experience, we've heard a lot of them.
In this article, we focus on the 5 myths we hear most often. Which ones are false and which ones might be true?
Myth 1: Debt collection is not worth it
For some cases, this statement is true! But fortunately, for the vast majority of cases, it is wrong.
Of course, debt collection can pay off, and fortunately the vast majority of cases are resolved - either through a full repayment or through an installment plan.
Most debt collection companies and debt collection lawyers make their living by solving their customers' cases - and often a debt collection company can earn interest, fees and charges if a case is solved. Therefore, the debt collection company has a great interest in solving the individual case - just as their customers have
That said, we also recognize that some cases are difficult or impossible to resolve. In some cases, the customer goes bankrupt or is so deeply in debt that an installment plan is not an option.
Myth 2: Debt collection is expensive
We will not judge what is expensive or not expensive, we just know that we are among Denmark's cheapest debt collection companies - and can offer some of the best prices on debt collection in the Nordic market.
You can find our prices and different solutions by visiting the link below.
Myth 3: I might as well collect the debt myself
Correct! As a creditor, you can easily carry out debt collection yourself - often called self-collection.
But just as you probably have a bookkeeper to do your bookkeeping, an accountant to help you with your annual accounts, and a lawyer to help you with legal matters - there are also many good reasons to outsource debt collection to a debt collection agency.
For example, a debt collection company can take care of everything from sending the first reminder to the enforcement court. All without you having to do anything, so you can concentrate on running and growing your business.
Myth 4: A lawyer must do more in a debt collection process than a debt collection agency
Wrong!
A debt collection company in Denmark is basically authorized by the Danish National Police - and thus has a large number of formalities, deadlines and requirements that must be met.
These are no different from those of the lawyer.
Most debt collection companies today have a lawyer or law firm on staff in case legal challenges arise during the collection process, such as objections or similar from the debtor.
Myth 5: Debt collection is a slow process
Both!
Some will undoubtedly find debt collection slow, while others will find that their cases are resolved in a matter of days.
Debt collection is an individual process and depends on two important factors: the size of the debt - and the creditor's ability and willingness to pay, communicate and engage in dialog about their debt.
How debt collection works at Collectia → How it works
Do you have more myths, questions or rumours you want to clarify?
Do you run a business and face challenges with bad payers from time to time? Then don't hesitate to contact us! - We will be happy to answer your questions and disprove any prejudices and myths you may have about debt collection agencies.
