Home Based Collection Agencies
A much needed service with low startup costs
Most businesses have had to handle non-paying customers at one time or another. Why not take on the task and get paid for it? Set up a home based collection agency.
For people with the fortitude, stamina and personality to be able to successfully collect outstanding debt, it is a much-needed service and potentially a lucrative business. A successful debt collector can justify the less than glamorous connotation of collecting outstanding debt by keeping the wronged business owner in mind. The business owner offered a product/service in good faith with the expectation of being duly compensated. The home-based collection agency is attempting to right a wrong. For individuals looking to work from home, this is a perfectly legal, necessary type of business.
Here are a few qualities and things to consider before starting a home-based collection agency business:
PERSONALITY TYPE:
A person who is persistent, patient and has a pension for investigation will have an easier time at being a debt collector than someone lacking such qualities. Not all outstanding debtors are upstanding citizens who are undergoing a financially difficult time. Some have intentionally defaulted, closed up shop and have moved without a forwarding address. For these types of deadbeats, it takes patience, persistence and investigative skills.
A close second to the above-mentioned personality traits is the ability to negotiate and speak empathetically with debtors. Some debtors have fallen on difficult financial times and have every intention of honoring their commitments. Unfortunately, unexpected financial disasters have befallen them. An empathetic debt collector with a keen ability to negotiate can finagle the outstanding debt to the top of the debtors "bills to pay" list, thereby increasing the likelihood of payment.
An innate ability to read people, whether in person or over the phone is also another valuable trait. It will help the debt collector to determine which tactic works best for each debtor.
OFFICE STARTUP NEEDS/COSTS:
Computer and basic software: Most homes are already equipped with a functioning computer with basic word-processing and spreadsheet software. The word-processing software is useful in creating letters, business cards, marketing information and newsletters. The spreadsheet software is a great way to keep track of outstanding debtors, amount due and a log of customer/debtor contact.
Once the home debt collection agency has grown and profits are up, look into purchasing software especially tailored for the debt collection business such as Sentinelds or Collect.
Be sure to research all software thoroughly before making a purchase.
A dedicated telephone: Whether it's a cell phone or a separate line in the home, be sure to have a phone just for the collection business
Fax/copy machine: With companies like Kinko's and Mail Boxes, etc, a fax/copy machine may not be necessary initially. They can be purchased as the business grows.
MARKETING NEEDS:
Website: Make sure the website portrays the correct company image. Remember, this is a professional business. Make sure the website is professional.
Networking: As with any type of business venture, 'it's not what you know, but who you know' that will help bring in the business. Get involved and small-business networking operations and hand out business cards.
EDUCATIONAL NEEDS:
Learn about the home debt collection agency business. Check the local, state and federal licensing ordinances to ensure compliance. Be familiar with the Fair Debt Collection Practices Act. Be knowledgeable about the debt collection business. It will impress potential clients.
