FAQ

This employee needs to possess previous collection and legal experience and ideally has worked at a collection law firm.

Depending on the size of your portfolio or the extent to which you want to recover your accounts. Generally, if you are starting a recovery department, one qualified candidate can file between 20-30 suits per month and file the equivalent amount in garnishments. From there, your growth may either go in the direction of a collector or a legal assistant to prepare court forms.

Most of your investment, after your initial payroll investment, comes from court fees. The cost also rise depending on how many suits per month are you planning to file and the filing fees for your state.

Maybe you are already happy with your collection attorney, and you want to discuss alternative ways to collect. You will be able to save more money (and hopefully recover more money), your attorney will be able to save more time! If you are branching out and need to start from scratch, place an ad in your local bar journal and interview potential candidates. Be advised that not all candidates may feel comfortable with filing law suits for your company without having total access or control to your files. A plan will need to be advised as to how the attorney will need to review the file and sign documents.

Collections is a very simple legal procedure. While experience is helpful, depending on the experience of your Recovery Manager, a veteran attorney may not be necessary. It is important to determine how you want your collections handled. Will you be representing cases in court if an answer is filed? Do you plan on defending each objection the defendant may file? How does your attorney interpret the FDCPA? It mostly depends on how hard-hitting you want your claims defended.

Check your states’ web site. Generally the Department of Treasury will provide a wealth of information to educate you in collection procedures in your state.

Determine which accounts or group of accounts you want to hit first. Are they sorted by outstanding $ balance? By charge-off or last payment date?

MONEY. Are you willing to give up 25-30% of your collections to attorney fees? You also have full control of your accounts and can guarantee that your accounts will be worked on a timely basis.

There is still a benefit to placing a public record on a debtor’s credit report. Generally, creditors do not extend credit to debtors that have Judgments filed against them. This forces your debtor to pay or settle your debt when purchasing a car or home. By putting “road blocks” on the debtor’s credit record, may insure a pay off for you in the future. Additionally, if your debtor owns any property, a lien may be placed on the property which makes it impossible for them to sell the property without dealing with your Judgment first.

Yes, these can be pursued, however jurisdiction is generally determined by the Defendant’s residence. Consequently, an out of state attorney is necessary to file a complaint. (Check with your attorney, a long-arm statute may be available in your state). If you have obtained a judgment against the debtor in your state, it may be necessary to domesticate the Judgment in the Defendant’s residence state in order to file garnishments or other post-Judgment attachments.

No. There are several law firms that specialize in coverage for every state. They have networked with several attorney offices so that you are only dealing with one office, and they are forwarding it to one of their “network” attorney offices.

• Income tax garnishment
• Garnishment of Lottery winnings
• Garnishment of insurance proceeds/settlements in other legal cases
• Property liens
• Rental property income
• Garnishment expiration periods
• Statute of limitations and does it reset when a payment is processed?

If your customers are not told that there are consequences for not paying the balance on their loan, you may find a higher rate of voluntary repossessions. If debtors are educated in future ramifications, it may encourage them to keep their vehicle and pay their loan voluntarily as opposed to having a lawsuit filed against them, being personally served by a sheriff or court officer, having a public record on their credit bureau, and the risk of their wages being garnished.

If you use a lawyer, you don’t need to be a collection agency. If you get a judgment assigned to you and you own it and then you hire a lawyer to enforce it for you (authorized to practice law in the state where the debtor lives), you are not doing any collections and can collect in any state.

Alabama $3,000
Alaska $7,500
Arizona $2,500
Arkansas $5,000
California $5,000
Colorado $7,500
Connecticut $3,500
Delaware $15,000
District of Columbia $5,000
Florida $5,000
Georgia $15,000
Hawaii $3,500
Idaho $4,000
Illinois $5,000
Indiana $6,000 effective July 1, 2005
Iowa $5,000
Kansas $1,800 Kentucky $1,500
Louisiana $3,000
Maine $4,500
Maryland $5,000
Massachusetts $2,000
Michigan $5,000
Minnesota $7,500
Mississippi $2,500
Missouri $3,000
Montana $3,000
Nebraska $2,400
Nevada $5,000
New Hampshire $5,000
New Jersey $3,000
New Mexico $10,000
New York $3,000
North Carolina $4,000 North Dakota $5,000
Ohio $3,000
Oklahoma $4,500
Oregon $5,000
Pennsylvania $10,000
Rhode Island $1,500
South Carolina $7,500
South Dakota $8,000
Tennessee $15,000
Texas $5,000
Utah $5,000
Vermont $3,500
Virginia $2,000
Washington $4,000
West Virginia $5,000
Wisconsin $5,000
Wyoming $3,000