Debt Recovery Solicitors or a Debt Collection Agency – Which is Better?

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Debt Recovery Solicitors or a Debt Collection Agency

If you are a business or private individual who is owed money in the UK, your first action should be to attempt recovery.

In the case of all debt collection actions, there are generally three main choices.

Some people attempt to recover the money independently.

Whilst this may seem like the best option initially, it is in fact the most difficult of the three. 

This is because of the amount of time, money and effort it takes to recover the debt alone.

This is especially important for business owners, as they risk spending too much precious time chasing the debt.

The typical outcome of collecting a debt independently is having to pursue another course of action.

As well as this, the matter will eventually escalate to either the solicitor or agency route.

This valuable time could be instead spent better on growing the business.

Others instead opt to take court action. This involves contacting a specialist debt recovery solicitor to help.

The final option is to instruct a professional debt collection agency.

From this short introduction, it is clear that there are many paths to the recovery and enforcement of the debt that you are owed.

The question is, what is the best option for the recovery of a debt?

In this article, our in-house team of debt collection experts will provide their advice on the best way in which to get your money back.

Debt Collection Solicitors – Are They the Best Option?

If you have already tried to contact the debtor several times and they are still unresponsive, it is time to escalate the matter.

At this point, many people choose to go down the legal route.

This involves taking the debtor to court over the matter. This can be done by hiring the services of a debt recovery solicitor.

This can be effective, and business owners or private individuals have seen success with this option many times.

There are certain points to consider when looking into the option of hiring a debt recovery solicitor.

For example, one of the most important factors in the decision-making process will be the cost.

Solicitors are notoriously expensive, charging hundreds of pounds for each hour they work on your case.

This is understandable, as their time is extremely valuable. Yet this does not change the fact that this is a very expensive course of action.

The second key factor to consider is time. Whilst the court system is robust and fair, it can take an excessively long time for a case to be fully processed.

A private individual or business owner can find themselves waiting months for any kind of action to take place. In the meantime, the debt recovery solicitor will continue to charge for their time by the hour.

This will raise the cost even more.

Once the cost of the solicitor begins to outweigh the value of the actual debt that is being recovered, many people simply draw a line and ‘write-off’ the debt.

This should never happen.

Finally, there is no guaranteed outcome with debt recovery solicitors.

Of course, the goal is that they will take a case on and attempt to recover the outstanding debt. It is important to remember that they earn their fees regardless of whether they recover the debt or not.

There is a possibility that a case may not be won.

This leaves the creditor in the position of having to pay the debt recovery solicitors as well as still having the cost of the debt.

As well as this, many court cases end without a debt being collected, but with an approved CCJ instead.

Whilst this is a positive outcome, the debt still needs to be enforced and collected.

This puts the creditor in the position of having to pay even more fees to enforce and collect the debt.

To summarise, whilst a hiring debt recovery solicitors office is definitely a viable option, there is a much more affordable and faster method of debt collection available.

Debt Collection Agency – Low-Cost, Quick and Effective Debt Recovery

The most effective way to recover your debts is by instructing a professional debt collection agency.

Whilst debt recovery solicitors are the solution which crosses most people’s mind initially, this does not make them the ‘best’ option.

A professional debt collection agency will provide a low-cost, effective and professional service.

Your debt will be recovered in as timely a manner as possible, and at drastically lower cost than debt recovery solicitors.

Whilst lawyers will generally charge by the hour, most debt collection agencies will either charge a flat fee, or take a commission on the value of the debt. This commission can, in some cases, be as little as 6%.

A good debt collection agency will also only take on debts that can be recovered.

For agencies such as this, pay close attention to their recovery rate.

If it is above 85%, then this provides the highest likelihood that your debt will be recovered.

One downside to the process debt recovery solicitors follow is that you must directly engage with your debtor in order to recover the monies.

This may lead to feelings of animosity or resentment towards you on the part of the debtor, even if you are in the right.

A professional debt collection agency acts to leave your relationship with the debtor undamaged.

In the case of a business, this is invaluable. Future business opportunities will remain viable.

As well as this, a debt collection agency will enforce the collection of your debt in a far quicker way than that of the court systems.

Choosing a Debt Collection Agency

It is important to remember, however, that not all debt collection agencies are the same.

Knowing which one to choose can be a challenge in itself, and careful consideration should be taken when selecting one.

The debt collection agency you choose will effectively be an ambassador for you or your business.

Choosing a disreputable agency may prove to create even more headaches and issues than just that of the debt.

Often, choosing an agency comes down to a question of cost. Yet just because a debt collector provides a service at a low price point, it does not necessarily reflect its quality.

The best agencies to look for are ones that are rated highly by their clients, have a high recovery rate and are regulated by an official institution.

An example of this could be the Financial Conduct Authority (FCA).

For help with choosing the best debt collection agency, it pays to have an expert’s insight.

Best4DebtCollection has been providing recommendations for the best debt collection agencies since 2013.

This makes us the longest-running debt recovery comparison organisation in the UK.

Our in-house debt experts hand-pick the leading debt collection agencies for your requirements.

Our service is 100% free and open to anyone.

For help with choosing a professional debt collection agency, complete our quote wizard now. It takes less than 60 seconds and can help you find the best debt recovery experts quickly.