Collection Agencies vs. Collection Attorneys

If internal efforts have failed to resolve a debt issue, it may be time to call in a professional. But whatCollection Agency vs. Collection Attorney type of professional should you choose: a collection attorney or a collection agency?

Common Practices
Many companies will start with the latter in hopes that legal action can be avoided. For the most part, collection agencies will take many of the same actions against the debtor that you may have already taken. They often start with a series of letters and then move to phone contact if the initial letters are not effective. At Transworld Systems Commercial Division, however, we take an investigative approach combining the power exhibited by third-party collection agencies with specialized phone systems, software and training - making us more efficient and cost-effective at collecting delinquent accounts.

Collections Agencies at a Glance
Third-party collection agencies are often chosen over attorneys because there are no up-front costs and they do NOT have the negative image that is typically associated with using legal action.

This being said, the costs for collection services can vary greatly depending on the volume of accounts being submitted, the average size of accounts and the existing age of the accounts. Most collection agencies work on a percentage basis where they earn fees only on what they collect. Costs involved can often make this prohibitive.

What About Collection Attorneys?
Most collection attorneys charge an hourly fee, collect at least one-third of the amount recovered, or both. They usually charge a minimum fee or retainer and may require a minimum amount of debt. Plus, payment to the attorney is typically in addition to any court-related fees and charges connected with a lawsuit if you decide to pursue a judgment in court.

As such, most companies refer debt to a collection agency first. Of course, the goal of most companies is to avoid these issues altogether and if one is dealing with smaller balances, a collection attorney is not a viable option.

Our Approach
Transworld Systems Commercial Division offers a sophisticated collections program that complies with all federal and state guidelines and has been thoroughly tested to achieve optimal results. In conjunction with our experienced representatives, Transworld Systems can assist you in optimizing your third-party effort while maximizing your own in-house procedures in the hopes of reducing your total bad debt exposure.

Over the past 5 years, Transworld Systems Commercial Division has collected over $500 million for our clients. Let us show you how we can recover the money owed to you using our sophisticated Online Commercial Portal. For more information about Transworld Systems, please contact us here.


The information contained herein is only intended to be consultative. Please consult with a collection agency or collection attorney for further information and advice.



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